The Hong Kong taxi e‑payment law, which came into force on 1 April 2026, represents one of the most significant regulatory changes to the taxi industry in decades. Issued and enforced by the Transport Department of the Hong Kong SAR Government, the law mandates that all licensed taxis must provide electronic payment facilities in addition to cash.

Legal Framework of the Hong Kong Taxi E‑Payment Law

The Hong Kong taxi e‑payment law imposes binding obligations on all licensed taxi drivers operating in Hong Kong.

Under the requirements issued by the Transport Department, every taxi must offer at least two forms of electronic payment, consisting of:

• One QR‑code‑based electronic payment method, such as AlipayHK, WeChat Pay HK or BoC Pay.
• One non‑QR‑code electronic payment method, such as Octopus, credit cards or the Faster Payment System (“FPS”).

Drivers are allowed to choose the specific platforms based on operational considerations. However, providing electronic payment is mandatory. Cash may still be accepted as an alternative, but taxis are no longer permitted to operate on a cash‑only basis.

Mandatory Display and Transparency Requirements

In addition to accepting electronic payments, the Hong Kong taxi e‑payment law requires taxi drivers to ensure full transparency to passengers before boarding.

This includes:

• Clearly displaying approved stickers showing accepted electronic payment methods.
• Placing the stickers at designated positions on taxi windows.
• Ensuring payment options are easily visible and understandable.

This obligation is intended to reduce disputes and enhance consumer protection by ensuring informed consent at the start of the journey.

Enforcement and Criminal Liability

Compliance with the Hong Kong taxi e‑payment law is enforced through existing transport and licensing legislation.

Taxi drivers who fail to comply without reasonable excuse are subject to:

• A maximum fine of HK$5,000.
• Imprisonment for up to six months.

The Transport Department has not provided a statutory grace period. Drivers are therefore expected to have installed compliant systems and to be operationally prepared from the date of commencement.

Government Policy Objectives Behind the Law

Modernisation of Taxi Services

The Transport Department has stated that the purpose of the Hong Kong taxi e‑payment law is to leverage electronic technology to enhance the overall quality and efficiency of taxi services.

This includes:

• Reducing cash‑handling risks.
• Improving transaction efficiency.
• Enhancing service reliability.
• Aligning taxis with other public transport modes.

The reform is part of a broader push to modernise legacy service sectors without dismantling the traditional taxi licensing framework.

Alignment With Hong Kong’s Smart City Strategy

Electronic payment infrastructure is a cornerstone of Hong Kong’s smart city ambitions. By mandating e‑payment in taxis, the government ensures that one of the city’s most visible public services aligns with:

• Digital financial infrastructure.
• Smart mobility initiatives.
• Data‑driven service governance.

This move also narrows the operational gap between taxis and app‑based ride services, which already rely on electronic payment systems.

Impact on Hong Kong Tourism

Enhancing First Impressions for Visitors

For years, the cash‑only nature of many Hong Kong taxis created friction for overseas and Mainland visitors. The Transport Department has explicitly recognised that electronic payments are particularly beneficial to tourists.

Under the Hong Kong taxi e‑payment law:

• Visitors no longer need to prepare local cash immediately upon arrival.
• Airport, hotel and business travel becomes smoother.
• Cross‑border payment platforms are directly supported.

From a tourism policy standpoint, the reform enhances Hong Kong’s image as an international and business‑friendly city.

What Taxi Drivers Need to Know in Practice

Installation Alone Is Not Enough

Taxi drivers must ensure that:

• E‑payment systems are installed, functional, and maintained.
• They understand how to initiate, confirm, and complete transactions.
• They can recognise successful payments and resolve minor user issues.

The Transport Department has repeatedly urged drivers to familiarise themselves with system operation. Lack of familiarity is unlikely to constitute a reasonable excuse in enforcement proceedings.

Handling Technical Failures

Technical issues may arise. However, drivers should be able to show that:

• The system was genuinely unavailable due to technical reasons.
• The issue was temporary rather than structural.
• Reasonable steps were taken to maintain system functionality.

Regular checks, updates, and proper maintenance significantly reduce legal risk.

Passenger Rights and Dispute Prevention

Passengers are now legally entitled to use approved electronic payment methods when taking a taxi.

The Hong Kong taxi e‑payment law aims to reduce disputes by ensuring:

• Clear payment disclosures.
• Standardised payment expectations.
• Transparent fare settlement.

Passengers who encounter suspected non‑compliance may report the incident with relevant journey details to the appropriate government channels.

FAQ: Hong Kong Taxi E‑Payment Law

What is the Hong Kong taxi e‑payment law?

The Hong Kong taxi e‑payment law is a mandatory regulatory requirement enforced by the Transport Department that obliges all licensed taxis in Hong Kong to accept electronic payments alongside cash from 1 April 2026.

Which electronic payment methods must taxi drivers accept?

Taxi drivers must offer at least two electronic payment methods, including one QR‑code‑based option and one non‑QR option, such as Octopus, credit cards or FPS. Drivers may choose compliant platforms, but refusal to accept e‑payment is unlawful.

Is cash still allowed in Hong Kong taxis?

Yes. Cash payments remain permitted. However, taxis can no longer operate on a cash‑only basis. Electronic payment acceptance is now a legal requirement.

What happens if a taxi driver does not comply?

A taxi driver who fails to comply with the Hong Kong taxi e‑payment law without reasonable excuse may face:

• A fine of up to HK$5,000
• Imprisonment for up to six months

Non‑compliance is treated as a licensing and criminal enforcement issue.

Are taxi drivers allowed to add extra charges for e‑payment?

Taxi fares must be charged strictly according to the meter. While the law mandates acceptance of electronic payment, additional charges or surcharges are legally sensitive and may expose drivers to complaints or enforcement action.

What should taxi drivers do to stay compliant?

Taxi drivers should ensure that:

• E‑payment systems are installed and functional.
• They are familiar with operating the devices.
• Accepted payment methods are clearly displayed.
• Systems are properly maintained.

Operational unfamiliarity is unlikely to excuse non‑compliance.

How does the law affect Hong Kong tourism?

The Hong Kong taxi e‑payment law improves convenience for overseas and Mainland visitors by enabling cashless travel, reducing confusion over fares, and aligning taxis with international service expectations. This enhances Hong Kong’s position as a global travel and business hub.

What can passengers do if a taxi refuses electronic payment?

Passengers may document the journey details and raise a complaint with the relevant government authorities if a taxi refuses lawful electronic payment without justification. 

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Your point of contact in Hong Kong: Stefan Schmierer

Ravenscroft & Schmierer

22nd Floor, Bupa Centre
141 Connaught Road West
Hong Kong, SAR

CELL:    +852 9229 6603
TEL:      +852 2388 3899
FAX:      +852 2385 2696

www.rs-lawyers.com.hk
sschmierer@rs-lawyers.com.hk

Negotiations on a Free Trade Agreement (FTA) between the European Union and the Philippines have entered their decisive phase. Following the seventh negotiating round, held in Brussels from 29 June to 3 July 2026, both sides are aiming to conclude the agreement within the year. From a European perspective, this is more than another trade deal – it is a strategic building block of the EU’s presence in the Indo-Pacific.

Substantial Untapped Potential

According to Philippine Trade Undersecretary Allan Gepty, the International Trade Centre values the Philippines’ total export potential to Europe at USD 22 billion – of which roughly USD 12 billion remains untapped. For European businesses, the reverse also holds: considerable headroom exists in the direction of the Philippines. The archipelago, with more than 115 million consumers, is among the fastest-growing economies in the ASEAN region and offers European machinery and equipment manufacturers, pharmaceutical and food companies a market hitherto dominated by Asian competitors.

Why Time Is Pressing: GSP+ Is Expiring

The Philippines currently benefits from the EU’s GSP+ preferential scheme, under which more than 6,000 product lines enter the EU duty-free – with a utilisation rate reaching 80 per cent for the first time in 2025. However, the scheme expires at the end of 2027. Moreover, the Philippines attained upper-middle-income status in July 2026 – a milestone that will, in the medium term, lead to the loss of GSP+ privileges. Only an FTA creates a permanent, reciprocal and legally secure market access framework. Both sides therefore have a clear interest in a swift conclusion.

The European Perspective: Diversification and Standards

For Brussels, the agreement fits squarely within its de-risking strategy: diversification of supply chains, access to critical raw materials – the Philippines is one of the world’s largest nickel producers – and the anchoring of European standards in sustainability, digital trade, intellectual property and public procurement. After Singapore and Vietnam, the Philippines would become the third ASEAN country with a comprehensive EU trade agreement. The European Parliament underlined its support as early as February with a mission of its Committee on International Trade (INTA) to Manila.

What This Means for Investors from Germany, Austria and Switzerland

Companies from Germany and Austria, as EU Member States, stand to benefit directly from the EU agreement. Swiss companies already enjoy preferential market access: the free trade agreement between the EFTA States and the Philippines has been in force since 2018. With the conclusion of the EU FTA, German and Austrian competitors would catch up – placing the whole of German-speaking Europe on a uniform preferential footing. Combined with the recent liberalisation of Philippine investment law – full foreign ownership in renewable energy, expanded opportunities in the telecommunications sector, 99-year lease options – an increasingly attractive environment is emerging for companies from all three countries.

The German Desk of VGD Law in Makati assists companies from Germany, Austria and Switzerland with market entry and the structuring of their investments in the Philippines. Please feel free to get in touch.

This article is for general information purposes only and does not constitute legal advice.

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Your point of contact in the Philippines: Lutz Kaiser

Villanueva Gabionza & Dy Law Offices

20th/F Corporate Center
139 Valero St., Salcedo Village
Makati City 1227, Philippines

CELL: +63 995 985 4957
TEL: +63 2 8813 3351
FAX: +63 2 8816 6741

www.vgdlaw.ph
kaiser@adwa-law.com

Thailand has officially joined the growing list of countries developing comprehensive artificial intelligence legislation. On 2 July 2026, the Electronic Transactions Development Agency (ETDA) opened an approximately one-month public consultation on an updated draft AI law—a proposal that closely follows Europe’s risk-based regulatory framework while adding mechanisms specific to Thailand, ranging from royal decrees to a national data exchange institute.

A Broad Regulatory Reach

Perhaps the most consequential feature is the draft’s global reach. Any company whose AI affects people in Thailand falls within its scope, regardless of where the company operates or whether it has an establishment in the country. Offshore providers would be required to appoint a representative in Thailand, and for certain categories of systems, that representative must have unrestricted authority and unlimited liability on behalf of the provider.

A handful of exemptions soften the rules: purely personal or private use, ethically approved academic research, pre-market research and development, and further exemptions that may later be granted by royal decree.

Three Risk Levels

The draft classifies AI according to a familiar hierarchy. At the top are absolute prohibitions: systems that manipulate behaviour through subliminal techniques or that lead to generalised, unjustified discrimination by processing irrelevant data. A national AI committee, which has yet to be established, may expand this list of prohibited practices.

Below this level, “high-risk” systems affecting national security, healthcare, energy supply, telecommunications, transport and similar critical sectors will be designated by royal decree. A third, flexible category allows regulators to require other specified systems to be notified, registered or approved before being put into operation.

Providers of high-risk systems must develop systems that are effective, transparent and fair and are subject to genuine human oversight, while regulators will be authorised to issue guidelines covering thirteen areas of supervision. Operators have their own obligations: risk management, compliance with the provider’s instructions, the deployment of qualified supervisory personnel, the retention of operating logs for at least six months and the reporting of unexpected hazards.

Labelling Synthetic Content

Deepfakes and generative content are addressed separately. Developers of image, audio or video generation tools must embed machine-readable markers identifying content as AI-generated. Anyone publishing synthetic material in sensitive areas such as elections, national security, investment recommendations, food and pharmaceutical information, and identity fraud must disclose its artificial origin. Platforms, meanwhile, must assess risks, review and label AI-generated content, provide reporting mechanisms and publish annual summaries.

Data Sovereignty and Strict Liability

Two provisions will be of particular concern to multinational companies. First, the national committee may require domestic data processing for AI services considered nationally important—a localisation power that could force new infrastructure expenditure and complicate cloud-based deployment. It may also impose binding contractual terms on AI providers serving government customers or customers in critical infrastructure sectors.

Second, the draft provides for strict liability: those responsible for damage caused by AI are jointly and severally liable, regardless of whether they acted negligently. Only force majeure, the injured party’s own conduct or compliance with an official order may be raised as a defence.

Enforcement Measures and Deadlines

Enforcement measures range from remedial orders to court-ordered suspensions, recalls and even the blocking of non-compliant systems at ISP level in Thailand. Fines range from THB 1 million to THB 5 million.

The law is intended to be introduced in stages: the provisions relating to the placing of products on the market will apply immediately upon publication, while the rules on risk control and incident reporting will enter into force 180 days later. The draft also contains provisions concerning a “Big Data Institute” and voluntary best-practice frameworks that could unlock government investment incentives.

Conclusion

Companies that develop or deploy AI reaching users in Thailand should already begin assessing their risks and consider making their views heard while the law is still being developed and the consultation window at the Ministry of Digital Economy and Society remains open.

This article is intended as a general overview and does not constitute legal advice. If you have any questions or require tailored legal assistance, please do not hesitate to contact the Respondek & Fan team.

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Your point of contact in Thailand: Dr. Andreas Respondek

Respondek & Fan Ltd

United Center, 39th Floor, Suite 3904 B
323 Silom Road
Bangkok 10500, Thailand

CELL:     +66 89 896 4048
TEL:       +66 2 635 5498
FAX:       +66 2 635 5499

www.rflegal.com
respondek@rflegal.com

Recently, the Indian government issued several fresh rules concerning investment in Indian companies (i.a. Foreign Exchange Management (Non-Debt Instruments) (Amendment) Rules dated 12^th June and 1^st May, 2026, respectively).

In both cases, special provisions were made to guard against investment by entities registered in, controlled by or with an ultimate beneficial owner from a country bordering on India—which would include Myanmar, China, Bangladesh, Bhutan, Nepal and Pakistan.

In many cases, this would now require government approval. This is in line with various administrative requirements to confirm non-involvement of such neighbouring states. This might be an issue to be considered when planning Asian holding structures for a D-A-CH-company.

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Your point of contact in India: Dr. Jörg Schendel

Suman Khaitan & Co.

W-13, West Wing, Greater Kailash Part-II
Delhi 110048, Indien

CELL:     +91 97 11 08 04 03
TEL:       +91 11 49 50 15 00
FAX:       +91 11 49 50 15 99

www.sumankhaitanco.in
germandesk@sumankhaitanco.in
schendel@adwa-law.com

Vietnam has implemented the OECD/G20 Inclusive Framework’s Pillar Two rules, introducing a 15 % global minimum tax framework for qualifying multinational enterprise groups (“MNE-group”).

Who is affected?

The rules generally apply to all legal entities in Vietnam — and thus also cover foreign-owned companies operating in Vietnam — that qualify as Constituent Entities, i.e. entities forming part of an MNE-group, where the group has consolidated annual revenues of at least EUR 750 million in at least two of the four preceding fiscal years.

How does Vietnam implement Pillar Two?

Vietnam has implemented two principal mechanisms:

• Qualified Domestic Minimum Top-up Tax (QDMTT)
  Where the effective tax rate of a Vietnamese Constituent Entity is below 15 %, Vietnam may impose a domestic top-up tax to bring the effective tax rate up to the minimum level.

• Income Inclusion Rule (IIR)
  Where a qualifying parent entity of an in-scope MNE-group is located in Vietnam, the Vietnamese parent entity may be required to pay top-up tax in respect of low-taxed Constituent Entities situated outside of Vietnam. The IIR therefore enables Vietnam to collect top-up tax relating to certain foreign subsidiaries, provided that the relevant top-up tax has not already been collected under a qualified domestic minimum top-up tax in the relevant jurisdiction.

What does this mean for Vietnamese tax incentives?

For MNE-groups subject to Pillar Two, Vietnam’s traditional tax incentives may have less economic value if they reduce the effective tax rate below the 15 % global minimum rate, since a top-up tax may have to be applied.

Following such “ineffectiveness” of the most prevalent investment incentive scheme Vietnam has granted and maintained over the years, mostly granted based on the location of a taxpayer, the Vietnamese Government is increasingly providing for alternative investment support measures, which are targeted at specific industries and/or activities such as, for example, high-tech projects, support for R&D, training, investment costs and infrastructure projects.

Compliance obligations

Affected Constituent Entities must comply with several reporting and registration obligations, including:

• notification of the Constituent Entity responsible for fulfilling Pillar Two obligations, including the submission of the relevant tax returns and payment of any top-up tax due (where there is more than one Constituent Entity in Vietnam);
• registration for a separate tax identification number for Pillar Two purposes;
• submission of the QDMTT filing package and payment of any top-up tax due; and
• submission of the relevant IIR filing package and payment of any top-up tax due.

The applicable deadlines vary depending on the relevant obligation and whether the filing relates to the first in-scope fiscal year or a subsequent fiscal year.

The key takeaway

For in-scope MNE-groups, the assessment of the group’s tax position can no longer be based solely on the corporate income tax rates applicable in individual jurisdictions. MNE-groups must re-determine their jurisdictional effective tax rates under the Global Anti-Base Erosion (“GloBE”) Rules and assess whether such re-evaluation leads to top-up tax obligations.

Pillar Two therefore requires a coordinated, group-wide approach to tax data collection, effective tax rate calculations as well as to determine reporting and compliance obligations.

MNE-groups operating in Vietnam should therefore assess their potential exposure and ensure that the applicable reporting and compliance obligations are complied with.

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Your point of contact in Vietnam: Christian A. Brendel

Brendel & Associates Law Co., Ltd.

D&D Tower, 10th Floor, 458 Nguyen Thi Minh Khai
Ban Co Ward,
Ho-Chi-Minh-Stadt, Vietnam

CELL:     +84 98 978 4791
TEL:       +84 28 3911 2008
FAX:       +84 28 3911 2010

www.brendel-associates.com
info@brendel-associates.com

Korea’s Labor Standards Act previously required employers to provide at least a 30-minute break even for shifts of only four hours, and employees were required to take that break. This rigid regulation drew criticism in practice, as many employees expressed the desire to go home directly after work without taking a break. Additionally, paid annual leave could previously only be used in full-day increments, although some companies had already offered more flexible solutions such as half-day or hourly leave through internal policies or collective agreements.

These practical needs for greater flexibility in working hours and vacation regulations have now been addressed through a legislative amendment. The reform establishes a clear legal basis for two key changes: the option to waive breaks for four-hour workdays and the ability to use annual leave on an hourly basis. With this, the legislature responds to growing demand for more individualized working hour arrangements and modernizes what were previously inflexible regulations.

Key Changes and Their Effective Dates

The Labor Standards Act reform introduces three central amendments that take effect at different times.

Starting December 10, 2026, employees whose working hours equal exactly four hours may waive the 30-minute break upon their explicit request and go home directly after work. However, this provision is strictly tied to the employee’s voluntary decision—employers may not unilaterally impose a waiver. Rather, the employee must express their own wish and may not be pressured by the employer to do so. Employers must document this appropriately and verifiably to avoid penalties.

Starting June 10, 2027, the option to use paid annual leave on an hourly basis takes effect. This provision is based on amended Article 60, Paragraph 5 of the Labor Standards Act, which requires employers to grant leave in time segments upon the employee’s requests. However, the exact modalities, such as usable time segments or annual limits, are not set directly in the statute but will be regulated through a Enforcement Decree. Companies therefore need to await the upcoming adjustments to the Enforcement Decree and guidelines from the Ministry of Employment and Labor to plan implementation details.

Additionally, amended Article 60, Paragraph 9 of the Labor Standards Act introduces a prohibition on discriminatory measures. Employers are accordingly forbidden from dismissing or otherwise disadvantaging employees for requesting or taking annual leave. Violations carry fines of up to 5,000,000 KRW. Furthermore, failure to grant hourly leave may be penalized as a violation of the obligation to provide leave, punishable by imprisonment of up to two years or a fine of up to 20,000,000 KRW.

Action Recommendations for Companies

To comply with the new regulations, companies should prepare gradually, covering both technical and organizational aspects.

By the second half of 2026, it is necessary to introduce a procedure for waiving breaks during four-hour workdays. This procedure should ensure that any waiver is based on an explicit employee request and documented accordingly. Digital solutions such as HR systems or forms are well-suited here to clearly and traceably record the employee’s intention. Importantly, employers must avoid creating the impression that they are forcing or encouraging the break waiver.

For hourly annual leave usage, which becomes possible starting June 10, 2027, companies must adapt their operational policies. This includes clarifying several questions: How is remaining leave in days or hours managed? How is payroll processed when leave is taken on an hourly basis? And how are leave balances displayed in time tracking systems? Additionally, a review of the Rules of Employment and internal provisions is necessary to ensure alignment with the new statutory requirements. Since the exact modalities will only be established through Enforcement Decree, companies are advised to make adjustments to the Rules of Employment and other internal policies only after final regulations are published.

This article was written by ADWA lawyer Anton Schröder in Korea, Nak Hyun Choi, and Bo Hoon Kim (D&A LLC).

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Your point of contact in Korea: Joachim Nowak

DAERYOOK & AJU LLC

7 – 16F, Donghoon Tower
317, Teheran-ro, Gangnam-gu
Seoul 06151, Republik Korea

CELL: +82 10 9001 6430
TEL: +82 2 772 5948
FAX: +82 2 3016 5222

www.draju.com
nowak@draju.com

From LINDUNG 24/7 (officially: Skim Kemalangan Bukan Bencana Kerja, SKBBK) is an insurance scheme administered by Malaysia’s Social Security Organisation, SOCSO, which provides employees with round-the-clock protection against non-work-related accidents. Since 8 July 2026, participation in SOCSO’s LINDUNG 24/7 scheme (SKBBK) has no longer been mandatory for local employees in Malaysia, but voluntary. For foreign employees, including employees seconded from the D-A-CH-region, participation remains mandatory. What may initially appear to be a reduction in administrative burden actually creates more work for HR departments: a simple yes-or-no rule has been replaced by a process involving three employee categories that must be administered in parallel.

Question 1: What does the new payroll logic look like?

Payroll systems must now distinguish between:

• Mandatory participants (foreign employees) – nothing changes for this group. The contribution rates of 0.75%, 1.00% from the third year and 1.25% from the sixth year, capped at a monthly salary of RM 6,000, continue to apply unchanged.

• Local employees who submit a Notis Pelepasan Liabiliti through the LINDUNG Faedah portal by 31 August 2026 (opt-out).

• Local employees who take no action and are therefore automatically deemed to remain enrolled.

Anyone who misses the deadline will remain enrolled. An opt-out, once declared, is also not final: re-enrolment is possible at any time, although it will not apply retroactively to the period of non-participation. Contributions already paid in June will not be refunded. Since 16 July 2026, the updated application form has also included a “Change Employer” option. Employees joining or leaving the company must therefore also be actively updated in the portal.

Question 2: What about existing employment contracts and handbooks?

Many companies introduced general clauses in June stating, for example, “The employee participates in the LINDUNG 24/7 scheme…” For local employees, these clauses are now simply incorrect because they suggest that participation is mandatory when this is no longer the case. This typically affects salary deduction clauses, handbook sections relating to social benefits and onboarding documents.

Simply continuing to make the deductions is not a solution: a salary deduction without a valid legal basis may be challenged under employment law. A formally valid amendment is required, generally through the written consent of both parties in the form of a variation agreement or side letter. A unilateral circular is insufficient where the clause forms part of the employment contract. In the case of a handbook, the relevant question is whether it has been incorporated into the employment contract by reference. If so, the same consent requirements apply. Communications and opt-out declarations should be documented and filed in a structured manner, particularly because PERKESO has not yet published the final administrative procedure.

Question 3: How should the clause be drafted for new hires?

For foreign employees, the existing mandatory wording remains valid without amendment. For local employees, however, a dynamic clause is recommended that no longer presents participation as automatic:

“The employee shall participate in the LINDUNG 24/7 scheme (SKBBK) in accordance with the SOCSO provisions applicable from time to time, unless the employee elects not to participate in accordance with the procedure prescribed by PERKESO. The applicable contribution shall be deducted from the employee’s salary at the rates in force at the time the payroll is processed.”

This wording will also accommodate the fundamental review of the scheme announced for the end of the year without requiring a further amendment.

Recommended Immediate Measures

By 31 August 2026, companies should: (1) review their template employment contracts and handbooks for the clauses referred to above, (2) provide employees with documented information about their right to opt out, and (3) adjust their payroll processes to reflect the new three-category logic. The comprehensive review of the entire scheme announced for the end of the year is likely to result in further changes. This is therefore an issue that is better kept under review than considered closed for a second time.

Dr Harald Sippel is ADWA’s partner for Malaysia and, as an Austrian lawyer, assists German-speaking companies with matters of Malaysian law. Contact him if you have any questions regarding the practical implementation within your company. A more detailed analysis containing all relevant background information is available here.

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Your point of contact in Malaysia: Dr. Harald Sippel

Aqran Vijandran

5-2A, Medan Klang Lama 28, 419, Jalan Klang Lama
Wilayah Persekutuan
Kuala Lumpur, Malaysia

TEL:      +60 1 8211 4958

www.aqranvijandran.com
sippel@adwa-law.com

With effect from 16 July 2026, comprehensive amendments to the Singapore Code on Take-overs and Mergers have entered into force. The reform aims to increase transparency in public takeovers, strengthen shareholder protection and ensure fair competition between competing bidders. At the same time, the rules are intended to be more closely aligned with international market standards and current transaction practice.

The key changes include:

• raising the control threshold from 20 % to 30 % of the voting rights;
• stricter transparency and disclosure requirements during the takeover process;
• clearer rules governing the exchange of information between the target company and competing bidders in order to ensure equal treatment of all interested parties;
• clarified requirements for break fees and other deal-protection measures: in future, break fees may not exceed a total of 1 % of the target company’s value, calculated by reference to the offer price, and will only become payable if the offer becomes unconditional or is declared unconditional. In addition, so-called matching rights are generally limited to a maximum of seven days;
• codification of the authority of the Securities Industry Council (SIC) to require a potential bidder to clarify its intentions: where uncertainty persists, the SIC may require the bidder, within 28 days, either to announce a firm intention to make an offer or to issue a “No Intention to Bid” statement;
• a new deadline for schemes of arrangement: the general meeting to vote on a scheme must in future be held within six months of its announcement;
• the express inclusion of social media, podcasts and webcasts in the rules governing takeover communications.

In addition, the reform contains further amendments, including provisions concerning the handling of competing offers, actions taken by the target company during a takeover process and disclosure obligations towards shareholders.

The reform underscores Singapore’s efforts to promote a transparent and internationally competitive M&A market while placing greater emphasis on the interests of shareholders.

Our conclusion: The reform introduces numerous practical changes for public takeovers of listed companies in Singapore. Companies and investors should take the new requirements into account at an early stage of their transaction planning and review their existing processes accordingly, particularly with regard to information obligations, deal-protection clauses and communications during a takeover process..

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Your point of contact in Singapore: Dr. Andreas Respondek

Respondek & Fan Pte Ltd

1 North Bridge Road
#16-03 High Street Centre
Singapore 179094

CELL:      +65 9751 0757
TEL:        +65 6324 0060
FAX:       +65 6324 0223

www.rflegal.com
respondek@rflegal.com