Antimonopolgesetz – Wichtigste Änderungen im Überblick

Am 1. August 2022 erfuhr das Antimonopolgesetz der Volksrepublik China (AMG) seine erste Revision. Von der Einführung der «Safe Harbor»-Regel über den «Stop the clock»-Mechanismus und die neuen Anmeldeschwellen bis zu erheblichen Verschärfungen von Sanktionen wurden wichtige Änderungen in allen vier Hauptbereichen des AMG vorgenommen.

Die Änderungen sollten Sie kennen, da das AMG für alle Unternehmen unabhängig von deren Größe gilt und auf Verhalten von Unternehmen sowohl innerhalb als auch außerhalb Chinas Anwendung findet. Schauen Sie sich den ganzen Überblick über die Änderungen des AMG unter dem folgenden Link an: https://lnkd.in/d64W3Jnh.

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Your point of contact in China: Stefan Schmierer

Burkardt & Partner

Suite 2507, 25/F, Bund Center
222 Yanan Road (East)
Shanghai 200002, P.R. China

CELL:    +86 186 1687 7153
TEL:      +86 21 6321 0088
FAX:      +86 21 6321 1100

www.bktlegal.com
info@bktlegal.com

Promising Development: Hong Kong Court Provides Assistance to Victims of Internet Fraud

Hong Kong, a renowed global financial center, has experienced a worrying increase in international internet fraud in recent years. Victims of such fraudulent activities often find themselves transferring money to deceitful individuals’ bank accounts based in Hong Kong. These illicit funds are swiftly moved through a series of international transactions, making them extremely difficult to trace and resulting in significant losses for the victims.

Fortunately, an effective tool has emerged in the fight against internet fraud with the Hong Kong Police’s implementation of a “Letter of No Consent (LNC)”. When a victim becomes aware of a fraudulent scheme, they can promptly file an online report with the Hong Kong Police. Subsequently, the police collaborate with the relevant bank to determine if any funds, either in full or in part, remain in the fraudulent account. Upon identifying suspicious activity, an LNC is issued to the bank, notifying them of the potentially fraudulent nature of the funds. Consequently, the bank often freezes the associated account, giving the victim sufficient time to pursue legal action and recover their funds through civil court proceedings based on the principle of unjust enrichment.

Unfortunately, the effectiveness of the LNC system was called into question in 2021 with the case of Tam Sze Leung & Ors vs. Commissioner of Police. The initial ruling by the Hong Kong court deemed the LNC System illegal and unconstitutional, citing violation of property rights as outlined in the Hong Kong Basic Law. This decision left victims uncertain about the status of previously issued LNCs, forcing them to seek costly court injunctions to freeze the fraudulent accounts. Regrettably, at the time of filing such injunctions, victims were unaware of whether any funds remained in the accounts or if they had already been emptied.

However, a recent development has renewed hope. The Hong Kong Court of Appeal overturned the Court of First Instance’s decision, effectively reinstating the LNC system and confirming its compliance with existing laws, regulations and the Hong Kong Basic Law. This crucial ruling not only brings significant relief to victims of internet fraud but also empowers local law enforcement agencies with a powerful tool to freeze bank accounts, strengthening their ability to combat cybercriminals.

Nevertheless, it is essential to remember that the effectiveness of an LNC relies on the victim’s prompt discovery of the fraud and immediate reporting to the Hong Kong Police. Fraudsters typically drain the acquired funds within a short period of one or two days, emphasizing the vital importance of swift action to protect one’s rights after falling victim to internet fraud.

In the ever-changing landscape of the digital world, this triumph serves as a hopeful symbol, demonstrating the resilience of justice in the face of deceit. As the battle against internet fraud continues, this significant milestone bolsters the ongoing fight, empowering the Hong Kong appeal court to firmly exercise its authority and provide relief to victims entangled in the intricate webs of cybercrime.

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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

Indian Rupee-2,000-Banknotes to be Taken out of Circulation

The Indian central bank ordered all banknotes of INR 2,000 to be taken out of circulation. The notes remain legal tender, but will no longer be printed or issued to the public; instead, people are encouraged to exchange them at the banks, which will send the notes to the central bank. The Rupee-2,000-note had only been introduced in 2016, then replacing notes of INR 1,000 as the largest denomination. This place now comes to notes of INR 500, or approximately EUR 5.67. This move renders cash transactions more cumbersome, their importance should decline further.

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Your contact person in India: Dr. Jörg Schendel

Suman Khaitan & Co.

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

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

Continued high level of foreign investment in Malaysia also thanks to tax and other benefits

The Malaysian Investment Development Authority (MIDA) approved 1,265 different projects in the first quarter of 2023, with a value exceeding 70 billion Ringgit – the equivalent of around USD 18 billion. As Star Media Group Berhad reported, over half of the value of these projects came in the form of foreign direct investment (FDI).

Many of the incentives given to foreign investors to Malaysia are currently being overhauled. We anticipate that new investment schemes will be announced in the third quarter of 2023 and we then expect to see even greater foreign direct investment.

As the key body in approving foreign investments, MIDA plays an instrumental role and having close ties to them will significantly impact whether your investment can obtain MIDA’s approval.

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Your point of contact in Malaysia: Dr. Harald Sippel

Skrine

Level 8, Wisma UOA Damansara
50 Jalan Dungun, Damansara Heights
Kuala Lumpur, Malaysia

TEL:        +60 1 8211 4958
FAX:       +60 3 2081 3999

www.skrine.com

Transfer Pricing Rules in the Philippines: A Guide to Compliance with the Arm’s Length Principle

The Philippines Bureau of Internal Revenue (BIR) has issued guidelines on transfer pricing issues.

Transfer pricing is the pricing of cross-border, intra-firm transactions between related parties and associated enterprises. Typically, a transfer price occurs between a taxpayer of a country with high income taxes and a related or associated enterprise of a country with low income tax rates. Transfer pricing issues may also arise from domestic transactions. The BIR’s guidelines apply to both cross border and domestic transactions between associated enterprises.

The revenue service request taxpayers to make transactions at arm’s length. The Arm’s Length Principle requires that transactions with a related party be made under comparable conditions and circumstances as a transaction with an independent party. If the transaction is deemed as “non-arm’s length”, the BIR can make the necessary adjustments to the taxable profits of the taxable entity to reflect the true value taxable profits.

Where property, other than certain real property, is transferred for less than an adequate and full consideration in money or money’s worth, then the amount by which the fair market value of the property exceeded the value of the consideration shall, for the purpose of the tax imposed by this Chapter, be deemed a gift, and shall be included in computing the amount of gifts made during the calendar year. Provided, however, that a sale, exchange, or other transfer of property made in the ordinary course of business (a transaction which is a bona fide, at arm’s length, free from any donative intent), will be considered as made for an adequate and full consideration in money or money’s worth.

The Philippines generally accepts the traditional transfer pricing methods recognised by the Organisation for Economic Co-operation and Development (OECD). These methods include the CUP (Comparable Uncontrolled Price) method, the RPM (Resale Price Method), the CPM (Cost Plus Method), the TNMM (Transactional Net Margin Method) and the PSM (Profit Split Method). Taxpayers are expected to use the most appropriate method depending on the nature of their transactions.

Taxpayers must be able to demonstrate that their transfer prices are consistent with the arm’s length principle by keeping adequate documentation for the purpose. Transfer Pricing Documents must show how the transfer pricing was arrived at.

Taxpayers with relation party transactions might need to file a BIR Form 1709 (Information Return on Transactions with Related Party) and non-submission of BIR Form 1709 will be penalized.

“Related Parties”, “Related Party Transactions”, and “Related Party Disclosures” are broadly and loosely defined. The substance of the relationships and not merely their legal form shall be taken into consideration.

A person or entity is here a related party, when a person or close member of that person’s family is related to a reporting entity if that person, there is control or joint control of the reporting entity, there is significant influence over the reporting entity; or key management personnel of the reporting entity is belonging to the parent of the reporting entity.

However, not all related parties are required to report transactions. The reporting is limited to taxpayers, who have transactions with either a Large Taxpayer, a taxpayer enjoying tax incentives, or has reported net operating losses for the current taxable year and the immediately preceding two consecutive taxable years.

A large taxpayer is one who has been classified and duly notified as such by for having satisfied any or a combination of criteria set by the BIR.

Taxpayers enjoying tax incentives are taxpayers enjoying preferential income tax rates under the Internal revenue code, special laws, or treaties, Proprietary educational institutions and hospitals, Regional operating headquarters or Board of Investment registered Economic zone enterprises. This includes numerous subsidiaries under foreign ownership. Tax exempted regional headquarters however, do not need to report such transactions.

Even where the taxpayers qualify for reporting, exemptions are granted by law.

Filing is only mandatory where certain thresholds amounts have been exceeded. Such threshold amounts are taking Gross Sales and the total amount of Related Party Transactions (in general; foreign or domestic) in account.

Those who are required to report Related Party Transactions will be subject to an initial assessment by the BIR. Transfer Pricing Documents no longer need to be attached to BIR Form 1709. They only need to be made readily available in case of audit. If the BIR assesses a taxpayer as “high-risk”, such taxpayer may be required to submit or make available its Transfer Pricing Documentation to the BIR. With the said documentation, the BIR will then determine whether adjustments need to be made to the taxable profits on the transaction.

It is possible to have Advance Pricing Arrangements (APA) approved or Mutual Agreement Procedures (MAP)initiated. APA and MAP are arrangements approved by the BIR which are intended to determine in advance the applicable transfer pricing; and/or prevent double taxation. APA and MAP can be initiated by agreement with the BIR, where authorized by any double tax treaty.

If no APA or MAP is availed of, then the transaction may later be subject to transfer pricing adjustments.

In summary, transactions between related parties should follow the arm’s length principle. Transaction prices must be comparable to the prices of arm’s length transactions. A taxpayer may take advantage of Advance Pricing Arrangements and Mutual Agreement Procedures for cross-border transactions, if available. Transaction documents between related parties must reflect arm’s length prices. Documentation must be complete and traceable.

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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
manila@adwa-law.com

Singapore Simplifies Cross-border Service of Legal Documents through accession to the Hague Service Convention

On 16 May 2023, Singapore submitted its instrument of accession to the Hague Convention of 15 November 1965 on the “Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters (“Service Convention”)” with the Ministry of Foreign Affairs of the Netherlands. Therefore Singapore has now become a party to the Service Convention, which will significantly facilitate and streamline the process for service of court and related documents in civil and commercial matters overseas.

By becoming a party to the Service Convention, Singapore will be able to benefit from a unified set of regulations for the serving of judicial and extrajudicial papers abroad, including in many of Singapore’s main trading partners, such as the USA, UK, China, Australia, Vietnam and the Philippines.

Without being a party to the Service Convention, serving of legal documents overseas can become rather costly, delayed and arguably uncertain as there are different procedural rules in every jurisdiction. In particular, the serving would have to go through diplomatic channels (a formal request from the court of origin is sent to its foreign ministry and later to the destination foreign ministry which then forwards the documents to the destination court). Under the Service Convention, the services of documents will go through a designated Central Authority (“CA”) of the Contracting Party and other contracting parties. The CA of the destination country will receive a request in the specified form, along with the papers to be served, from an authority or judicial official who is authorised to serve process in the country of origin which he/she then makes arrangements for service of the document by an appropriate agency, either in accordance with a procedure specified by its own legislation or in accordance with a procedure requested by the applicant. Once service has been carried out, the applicant will receive a standard form certificate from the CA verifying the documents’ service.

The Service Convention will help to ensure that Singapore legal proceedings are not contested or suspended because of improper service, and the Singapore judgment that is subsequently issued may be recognised or enforced outside Singapore. As a result, Singapore litigants would have more legal certainty to successfully and efficiently enforce their rights in other judications as the channels of transmissions are now internationally recognised.

The Service Convention is expected to enter into force for Singapore on 1 December 2023. The obligations under the Service Convention will be implemented through amendments to the Rules of Court 2021, the Singapore International Commercial Court Rules 2021, and the Family Justice Rules simultaneously with the enforcement of Service Convention. The Ministry of Law will be designated as Singapore’s CA under the Service Convention.

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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