Appropriate Methods

for

 

Dissolving a Hong Kong Company

 

July 2013

 

 

All rights reserved ã Lorenz & Partners 2013

 

Although Lorenz & Partners always pays great attention on updating information provided in newsletters and brochures we cannot take responsibility for the completeness, correctness or quality of the information provided. None of the information contained in this newsletter is meant to replace a personal consultation with a qualified lawyer. Liability claims regarding damage caused by the use or disuse of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected, if not generated deliberately or grossly negligent.

 

 

  1. Introduction

When setting up or buying a company in Hong Kong, it is a good idea considering the appropriate arrangements in case the company encounters financial or administrative problems that may force you to seize the business activities. This might not be necessarily a bad idea as long as an appropriate method is chosen.

 

Considering the available methods, we would like to provide you with a brief introduction in regard of the ways of a dissolution of a Hong Kong private company. A company can be dissolved by four different methods, which are:

 

  • by Deregistration

 

  • by Members’ Voluntary Winding-up
  • by Creditors’ Voluntary Winding-up, or

 

  • by Winding-up ordered by the court

 

According to the latest official statistics con-ducted by the Hong Kong Companies Registry, the total number of the registered Hong Kong private companies is approximately 1,067,820 as of April 2013.

 

While this is an impressive number, the num-ber of Hong Kong private companies which have been dissolved in 2013 is approximately 20,274, including

 

  • 10,162 companies dissolved by deregis-tration;

 

  • 547 companies dissolved by liquidation; and

 

the remaining units were dissolved by other methods (e.g. Striking-off).

 

This clearly illustrates, that the most common method for dissolving a company is dereg-

 

istration. However the other methods should also be considered, in case a deregistration is not feasible.

 

  1. Deregistration

Deregistration is a straight-forward method for dissolving a Hong Kong private company. It can be applied when the following require-ments are fulfilled:

 

  • all members (shareholders) of a company agree to the deregistration;

 

  • the company did not do any business or cease business for more than 3 months immediately before the commencement of the deregistration;

 

  • the company has no outstanding liabilities;
  • The company’s assets do not consist of any immovable property situated in Hong Kong.

 

In the majority of cases, deregistration is the preferable method for dissolution since the procedure is more simple compared to a liqui-dation (please refer to Parts III and IV). Therefore, the deregistration is much more controllable since it can be proceeded upon the approval of shareholders, and does not require any involvement of the court and/ or a liquidator. It can be completed within six months under normal circumstances (i.e. if no objections to the deregistration are raised, and all liabilities can be paid, if any). The costs for deregistration are therefore much lower.

 

However, one should consider that any of the liabilities of the officers (such as directors, company secretary, etc.) and members of the company are not influenced by the deregistra-tion. The Companies Registry has the power

 

  

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to reinstate the company on the register even though the company is dissolved by way of deregistration within 20 years from the dissolution date. In that case the company is regarded to be as having continued in existence and as if it had not been dissolved.

 

III. Members’ Voluntary Winding-up

 

If a Deregistration is not possible, (e.g if the company did have business in the last three months, or in case the above mentioned risk of the company being reinstated by the Companies Registry shall be excluded), then the company needs to be wound up by a member’s voluntary winding up.

 

Unlike after being deregistered, the company cannot be reinstated on the expiration of two years after the date of completion of the Wind-ing-up.

 

Member’s voluntary winding up can only be applied to limited companies registered in Hong Kong and as long as the company is solvent. Nevertheless, the costs of a Members’ Voluntary Winding-up are much higher than the ones of a Deregistration since it involves the ap-pointment of a liquidator during the process of Winding-up and the procedure is more complex, because the liquidator needs to collect all outstanding claims for the company, and pay all its debts, before the winding up can be finished. It normally takes one year (at least) for the completion. It is noteworthy that the majority of accounting information of the company need to be released to third parties (e.g. liquidator and other creditors) and therefore it lacks privacy.

 

For those reasons (more expensive, more time consuming, lack of privacy, etc.) the adoption of a Members’ Voluntary Winding-up is generally less frequent than Deregistration.

 

  1. Creditors’ Winding-up


winding up needs to prove that the company is indebted with the creditor as well as it is unable to pay its debts (i.e. insolvent). Similar to the Members’ Voluntary Winding-up, the appointment of a liquidator is required, therefore it also lacks privacy as the liquidator needs the accounting information to proceed the liquidation. The Creditors’ Voluntary Winding-up is more expensive since the complexity of procedure is greater than the Members’ Voluntary Winding-up, because the liquidator needs to pay all outstanding debts as far as possible, and needs to check and consider whether any creditors are preferred creditors, means their debts needs to be paid first, before settling the debts of other creditors.

 

  1. Court’s Winding-up

Other than the above-mentioned methods, a company can be wound up by the court for a number of reasons such as::

 

  • the shareholders of the company file a pe-tition to the court;

 

  • the company does not commence its busi-ness within one year from its incorpora-tion or suspends its business for a whole year;

 

  • the company is unable to pay its debts;
  • the Memorandum or Article of Associa-tion states that the company is to be dis-solved on the occurrence of certain events;

 

  • the company carries out or intends to carry out unlawful businesses;

 

  • the company does not have at least one director and/or secretary for more than six months immediately before the date of the winding-up petition;

 

  • the company has been persistently in breach of its statutory obligations; or

 

  • the company has failed to pay the payable annual registration fee under the Com-panies Ordinance.

 

 

Where the company is insolvent, the method of

a Creditors’ Voluntary Winding-up can be VI. Summary applied. However, the creditor applying for the

 

  

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In light of the above, it can be illustrated that Deregistration is seemingly the first choice for dissolving Hong Kong companies, but always depending on the individual situation of the company. It is frequently disregarded that it is highly important to choose an appropriate method before dissolving a company, and they realize its significance after the inappropriate steps have already been taken.

 

Therefore, a number of factors should be con-sidered prior to the closure of the company, for instances, the company structure, financial situation, privacy protection, influence towards the company’s shareholders/officers, etc. We

 

believe that a comprehensive review always brings you and your company a greater advantage and that you should seek proper legal advice before deciding to wind up your company.

 

 

 

 

Newsletter Nr. 161 (DE)

 

 

Besteuerung der Delaware Gesellschaft

 

June 2013

 

 

All rights reserved ã Lorenz & Partners 2013

 

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  1. Einführung

Eine Delaware Gesellschaft ist eine Limited Liability Company (LLC), welche nach den Regeln des Staates Delaware gegründet wurde. Sie ist dabei in ihrer Geschäftstätigkeit nicht an die Vereinigten Staaten gebunden. Die Delaware LLC kann z.B. Gesellschafterin einer Hongkong Gesellschaft sein, oder die Delaware LLC betreibt die Geschäfte direkt in Taiwan, China oder Deutschland. Für die Besteuerung in den USA hat dies keine Auswirkungen, da Gewinne einer Gesellschaft in den USA nur besteuert werden, wenn die Gesellschaft in den USA Geschäfte betreibt. Die Unternehmensstruktur kann beispielhaft folgendermaßen dargestellt werden:

 

 

 

  1. Besteuerung der  Delaware LLC

 

In den USA wird der Gewinn einer Delaware Limited Liability Company (LLC) nicht auf Gesellschaftsebene versteuert, sondern erst auf Gesell-schafterebene. Solange die Gesellschaft keine Geschäfte in den USA betreibt und keine offizielle Betriebsstätte in den USA hat, muss die LLC keine Federal Tax zahlen. Die LLC selbst ist zudem

 

nicht verpflichtet, eine Steuererklärung abzugeben.

Der Staat Delaware verlangt keine Steuern für Gewinne einer Gesellschaft (Corporate Income Tax). Allerdings gibt es in Delaware eine sog. Franchise Tax in Höhe von 250 USD pro Jahr, die von der Delaware LLC an den Staat Delaware pauschal zu zahlen ist.

 

  • Besteuerung der Gesellschafter einer Delaware LLC

Auf Ebene des Gesellschafters erfolgt keine Besteuerung, solange die LLC bzw. deren Gesellschafter in den USA selbst keine Geschäfte betreiben. Dies gilt sowohl für State Tax als auch für Federal Tax. Die LLC gilt für Steuer-zwecke als „disregarded entity“ (ähnlich der Besteuerung der deutschen Personengesellschaften) , sodass die Gewinne der LLC direkt dem Gesellschafter zugerechnet werden. Betreibt die LLC keine Geschäfte in den USA und bezieht somit auch keine Gewinne aus US-amerikanischen Quellen, gilt dies ebenso für den Gesellschafter. Solange der Gesellschafter

 

  • kein US-Staatsbürger ist,
  • keinen Wohnsitz in den US hat,

 

  • sich nicht in den USA aufhält, und

 

  • die LLC keine Einkommensquellen in den

 

USA hat,

 

unterliegt der Gesellschafter nicht der Besteuerung der USA.

 

Dividenden, die die LLC von Offshore Gesellschaften, z.B. einer Hongkong Gesellschaft erhält und an den Gesellschafter auszahlt, unterliegen damit ebenfalls nicht der Besteuerung. In Hongkong werden Dividenden-ausschüttungen nicht versteuert. In den

 

 

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USA werden die Dividenden dem Einkommen des Gesellschafters zugerechnet und nicht besteuert, da sie als Offshore Einkommen qualifiziert werden und somit in den USA nicht der Besteuerung unterliegen.

 

unterliegt lediglich einer jährlichen Besteuerung von 250 USD. Es fallen jedoch ggf. Steuern in den Tätigkeitsstaaten der Gesellschaften bzw. im Wohnsitzstaat des Gesellschafters an.

 

 

 

  1. Zusammenfassung

Die Gründung einer Delaware Gesellschaft mit einem alleinigen Gesellschafter ist grundsätzlich empfehlenswert, solange keine Geschäftsbeziehungen zu den USA unterhalten werden. Wenn keine Geschäfte mit und in den USA betrieben werden, unterliegt die LLC nicht der Besteuerung in den USA. In gleicher Weise werden die Gewinne der LLC auf Ebene des Gesellschafters in den USA nicht besteuert, solange er sich nicht in den USA aufhält, keine US-Staatsbürger ist und keinen Wohnsitz in den USA hat. Die Delaware LLC selbst

 

 

 

 

 

Newsletter No. 162 (EN)

 

 

Taxation of Technical Consulting Services

 

in Thailand

 

 

Thai Tank Terminal Co., Ltd. vs. Thai Revenue Department (Supreme Court Decision No. 13993/2555 (2012))

 

 

March 2016

 

 

A l l r i g ht s r e s e r v e d © L o r e n z & P a r t ne r s  2 0 1 6

 

 

 

Although Lorenz & Partners always pays great attention on updating information provided in newsletters and brochures we cannot take responsibility for the completeness, correct-ness or quality of the information provided. None of the information contained in this newsletter is meant to replace a personal consultation with a qualified lawyer. Liability claims regarding damage caused by the use or disuse of any information provided, includ-ing any kind of information which is incomplete or incorrect, will therefore be rejected, if not generated deliberately or grossly negligent.

 

 

 

  1. Introduction

 

This newsletter shall explain the tax treatment of technical consulting ser-vices provided from abroad to a Thai entity. The following summary of the complaint of Thai Tank Terminal Co., Ltd. (the “Plaintiff”) against the

 

Revenue Department (the “Defend-ant”) regarding notice for the submis-sion of corporate income tax provides a useful illustration of how the laws con-cerning taxation of technical services are currently being interpreted by the Thai Supreme Court.1

 

  1. Background

 

On 30 May 2001, the Defendant issued three notices for the corporate income tax submission to the Plaintiff:

 

  • Notice for the submission of the corporate income tax for the year 1995, issued on 30 May 2001;

 

  • Notice for the submission of the corporate income tax for the year 1994, issued on 30 May 2001;

 

  • Notice for the submission of the corporate income tax for the year 1996, issued on 28 Septem-ber 2001.

 

 

  • Supreme Court Decision No. 13993/2555 (2012).


 

All of the notices above referred to Sec-tion 70 of the Revenue Code:

 

“A company or juristic partnership incorpo-rated under foreign laws and not carrying on business in Thailand but receiving assess-able income under Section 40 (2)(3)(4)(5) or (6) which is paid from or in Thailand, shall be liable to pay tax.”

 

The Plaintiff, a foreign-invested entity registered under Thai law, entered into two separate service agreements with Pack Tank International BV, a company established under the laws of the Neth-erlands (“PTI”), for the provision of services from PTI to the Plaintiff: an In-tellectual Property License Agreement and an Offshore Services Agreement. When calculating payment under the re-spective agreements, the Plaintiff de-ducted 15% withholding tax from pay-ments under the Intellectual Property License Agreement, as the Plaintiff deemed such payments to be royalties in accordance with the applicable Double Taxation Agreement (“DTA”). How-ever, no withholding tax was deducted from payments arising in connection with the Offshore Services Agreement.

 

The Offshore Services Agreement pro-vided that throughout the six-year dura-tion of the contract, payment was to be divided into two parts: a variable fee and a monthly fee, with the monthly fee paid by the Plaintiff at a flat rate regardless of the service received from PTI.

 

 

 

 

 

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Under the Offshore Services Agreement, PTI offered services and assistance in several areas, including budgeting and budget control, employee training, pro-curement training, human resources, safety measures and security control, chemicals management and storage, fire control, database management, and other general services. The Offshore Services Agreement did not include any confidentiality clause.

 

All services in connection with the Off-shore Services Agreement were per-formed outside of Thailand. PTI did not carry on any business directly in Thai-land.

 

The Plaintiff held the opinion that the payments in connection with the Off-shore Services Agreement were not sub-ject to (withholding) tax in accordance with the applicable DTA and thus sub-mitted the complaint against the tax no-tices of the Defendant.

 

III. Basis of the Plaintiff’s Claim

 

The Plaintiff’s claim was based on the following key arguments:

 

Firstly, the Thai Revenue Code provides that assessable income under Section 40(3) includes

 

“Fee of goodwill, copyright or any other rights, annuity or annual payment of income derived from a will, any other juristic act, or court decision.”

 

The term “other rights” in the context of this provision is meant to include royal-ties.

 

The taxation of royalties is described in Article 12 of the DTA between Thai-land and the Netherlands. Based on this Article, for fees for services related to

 

the transfer of information and knowl-edge to be categorised as a royalty, the fee charged must directly relate to the use or the transfer of intellectual prop-erty. In contrast, a service fee is charged primarily for provision of a service, even if intellectual property may (secondarily) be involved.

 

  1. Decision of the Court of First In-stance and Court of Appeal

 

The court of first instance and the court of appeal ruled that the payments under the Offshore Services Agreement were subject to withholding tax.

 

The Court of Appeal ruled that the counselling given by PTI was to be con-sidered as “the use of, or the right to use, any patent, trade mark, design or model, plan, se-cret formula or process, or for information con-cerning industrial, commercial or scientific ex-perience” under Article 12 of the DTA.

 

Even though the Offshore Services Agreement did not specify that the Plaintiff had to keep the information confidential, nor that the Plaintiff should return the outcome of the ser-vices to PTI once the Offshore Services Agreement was terminated, the essence of Article 12 does not lie in confidential-ity of the information, as long as intel-lectual property rights are involved.

 

When the Court of Appeal considered the nature of services that PTI rendered for the Plaintiff under the Offshore Ser-vices Agreement, the Court found that most parts of the services consisted of industrial, commercial and scientific counselling. Merely a small part of the services concerned general counselling. The Court then went on to conclude that the payment was made for royalty fee, rather than for general counselling services. The flat rate fee under the Off-

 

 

 

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shore Services Agreement for the dura-tion of 6 years included, consequently, a royalty fee in disguise and was therefore subject to 15% withholding tax.

 

  1. Decision of the Supreme Court

 

The Supreme Court did not confirm the rulings of the court of first instance and court of appeal.

 

Following examination of the facts of the case and the testimonies of various witnesses and experts in the context of Thai taxation laws and the DTA, the Supreme Court made the following key determinations:

 

  • The services received by the Plaintiff were not a final product, i.e. they did not constitute knowledge or in-formation that the Plaintiff could use or apply directly in its business. Rather the services received involved the transfer of general and broad principles that needed to be adapted by the recipient to meet the needs of the recipient’s par-ticular business.

 

  • A royalty is a fee paid by the re-cipient for a transfer of intellectual property or a permission to use intellec-tual property. This aspect varies from a fee given to a service provider for his or her knowledge, skills, or experience to generate work or finished products.

 

  • Another criterion used to de-termine whether a service was a royalty or general service is the amount of the contracted fee related thereto. The amount of the contracted fee must be comparable and reasonable with respect to the services provided. In this case, the fees for services paid by the Plaintiff were significantly higher than the mar-ket price for general service in this busi-ness segment, which, if taken on its own,

 

could indicate that the services provided were in fact a royalty.

 

  1. The Offshore Services Agree-ment did not contain any obligations or requirements for confidentiality in rela-tion to the services. Services attracting royalties relate to the transfer of infor-mation which is of high industrial, commercial and scientific value and that as such requires an agreement of confi-dentiality between the parties.

 

On the basis of the above findings, the Court concluded that the services pro-vided by PTI to the Plaintiff were of general business nature, not a transfer of industrial, commercial or scientific in-formation. The monthly flat fee pay-ment made by the Plaintiff to PTI for such services was, consequently, a “ser-vice fee” and not a royalty.

 

  1. Conclusion

 

This decision indicates that the Thai Su-preme Court is aligning itself more and more with international interpretations of royalties in international taxation.

 

Having said this, the decision does in fact not substantially change the previ-ous position of the Supreme Court on the definition of royalties, nor does this decision provide any additional clarifica-tion as to at what level services (for ex-ample engineering services) will be clas-sified as royalties. The Supreme Court’s emphasis on the existence of a confi-dentiality clause opens doors to argue that payments for such technical ser-vices are in fact considered royalties if a confidentiality clause is implemented in-to the contract.

 

It therefore should be suggested either avoiding or at least carefully wording such confidentiality clauses in contracts

 

 

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on technical services in order to not provide arguments to the Revenue De-partment to qualify payments under such contracts as royalties.

 

Other than that, unfortunately, this de-cision does not give any additional guid-ance as to how to avoid future disputes with the Revenue Department.

 

 

Newsletter No. 164 (EN)

 

 

 

Current Legal Developments in Hong Kong

 

 

October 2013

 

 

A l l r i g ht s r e s e r v e d © L o r e n z & P a r t ne r s  2 0 1 3

 

Although Lorenz & Partners always pays great attention on updating information provided in newsletters and brochures we cannot take responsibility for the completeness, correctness or quality of the information provided. None of the information contained in this newsletter is meant to replace a personal consultation with a qualified lawyer. Liability claims regarding damage caused by the use or disuse of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected, if not generated deliberately or grossly negligent.

 

 

  1. Introduction

 

In this newsletter we would like to inform you about the following legal developments:

 

  1. Hong Kong

 

  1. Employment Law

 

In  Pure  International  (HK)  Limited  v.  Lo  Zan


  • The Hong Kong High Court consid-Chan Kenneth (2013) HKEC 1092  the Hong

 

 

ers reasonableness of restrictive covenant clauses in employment contract,

 

  • More consumer protection thanks to the new amendment of the Trade Descriptions Ordinance (TDO)

 

  • The Court of First Instance held that an annulment of bankruptcy proceedings does not debar a credi-tor, who failed to prove his debt, from asserting his claim after the an-nulment

 

  • Reform of the Hong Kong Trust Law

 

  • Establishment of the Hong Kong Ac-creditation Association Limited, HKMAAL aiming to enhance mediation standards

 

  • Myanmar signs the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention, 1958)

 

  • New Zealand reforms its Trust Law for the first time in nearly eighty years

 

  • China passes a new Immigration Law and increases visa categories and requirements

 

Kong High Court considered the validity of

 

a six-month restriction prohibiting an ex-employee from finding employment in the same activity within 1 km of the company’s principal location.

 

The reasons given by the Court of First In-stance in the judgment for upholding the re-striction are:

 

  • the restrictive covenant was clear, precise and reasonable in terms of time and geographical scope;

 

  • the company had commercial inte-rests and goodwill which needed a reasonable degree of protection;

 

  • the defendant was reminded of his contractual obligations one day be-fore he left the company and acknowledged the limitations impo-sed upon him, both orally and in writing;

 

  • the area covered by the radius of 1 km left the defendant a wide range of other opportunities to pursue his employment.

 

Because Hong Kong has no legislation gov-erning the enforceability of post-termination restrictions, the reasonableness of covenant clauses will be decided on a case-by-case basis. As evidenced by the reasons given by the High Court concerning this case, covenant clauses are generally effective if they are reasonable when taking into

 

 

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account the particularities of the specific employment employer – employee relationship.

 

Thus, contractual clauses should be formu-lated precisely and, at a minimum, contain the time period and geographical scope of the covenant. In addition, we advise our cli-ents to use a tailor made clause for each em-ployment contact to impede broadly held formulations that run the risk of being ambiguous. The more precise the clause is, the greater the chance that the courts will consider it as reasonable and effective and uphold the clause.

 

  1. Trust Law

 

The reformed Trust Law (The Trust Law Amendment Bill) will come into effect on 01 December 2013. Hong Kong’s Trust Law has not been reformed in nearly eighty years which makes this reform an urgent necessity. Moreover, it is important to amend the legal framework in order to keep up with the amendments already made by other com-mon law jurisdictions, such as Singapore and England, and adapt to new global conditions. The Trust Law will be changed as follows:

 

  1. a) Enhancing the trustees’ default powers with a view to facilitate the effective admini-stration of trusts. Under the new law, the trustee:

 

 

  • Limited validity of exculpation clauses,

 

  • Beneficiaries’ rights to appoint and retire trustees,

 

  • Reserved powers by settlors.

 

  • The regulations against perpetuities and excessive accumulation of income will be abolished. There will be neither a time limit for the existence of the trust nor for how long income may be accumulated in relation to non-charitable trusts.

 

  • There will be more protection against for-eign forced heirship rules (such as certain provisions that stipulate that a certain percentage of the deceased’s wealth has to go to the spouse or children). Hong Kong Trust Law shall be independent of foreign heirship regulations and its validity shall not be affected by them.

 

  • The scope of authorized investments will be broadened and restrictions relaxed.

 

The changes made by the new Trust Law put it in line, to a great extent, with the equivalent jurisdictions in Singapore and England. It will be interesting to see whether the changes in Hong Kong will lead to the same increase of trusts, as was observed in Singapore and England.

 

  1. Consumer Protection


 

  • Can appoint agents, nominees and custodians,

 

  • will have the power to insure the trust and

 

  • will have the entitlement to receive remuneration.

 

  • Introduction of checks and balances to enhance the beneficiaries’ protection. The new Trust Law contains the following changes:

 

On 19 July 2013, the Hong Kong Trade Descriptions Amendment Ordinance (TDO) came into force, enhancing consumer protection. The TDO stipulates which specific trade practices in connection with the offer and sale of goods as well as services are to be deemed unfair and henceforth forbidden and punishable.

 

The following forbidden activities are stipu-lated by the TDO:

 

 

·  Statutory duty of care,

 

·

Misleading omissions,

 

·

Aggressive commercial practices,

 

 

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  • Bait advertising,
  • Bait and switch, and

 

  • Wrongly accepting payment.

 

These changes were necessary because Hong Kong’s Trade Law was still dominated by the „Caveat Emptor“principle which left consumers unprotected against the large re-tail chains that used more or less illegal methods to shift all burden of risk to the consumers.

 

  1. Insolvency Law

 

In Lau Siu Hung v. Krzstof Marszalek (HCCW 484/2009, 17 June 2013), the Court of First Instance held that an annulment of bank-ruptcy does not debar a creditor, who has not proved his provable debt, from asserting his claim after the annulment.

 

The court did not agree with the defendant debtor, who argued that the payments that were sought were in fact invalid because he assumed they did not constitute “debts” of the debtors, as they had not been proved in the debtors’ bankruptcies before the annul-ment orders were made. He believed that the statutory law could not be interpreted as such.

 

By negating this opinion, the judgment pro-vides clarity as to how the Bankruptcy Law is to be interpreted and enhances the rights of creditors.

 

  1. Mediation


as well as assessors, trainees, instructors and all other persons involved in the mediation process and therewith raise the quality and training of the mediation process.

 

The large amount of court decisions related to mediation emphasize the increasing importance of this process. Two court deci-sions are of special importance, as they lay down two essential mediation principles.

 

In Chu Chung Ming & Anor v. Wai Dan & Ors (2012) 5 HKC 418, the court clarified that information exchanged during the mediation process is confidential.

 

In David Frost v. Wake Smith & Tofields Solici-tors (2013) EWCA Civ 772 the court ren-dered that lawyers and mediators cannot and respectively are not obliged to reach an agreement between the parties involved. Even though reaching an amicable agree-ment is one goal of the mediation process, it cannot be coerced.

 

The courts also point out that agreements reached by mediation by the involved parties are subject to general regulations on effectiveness of agreements and contracts and hence are only binding and enforceable if they comply with these regulations.

 

In Hong Kong, it is statutory that a media-tion process is completed prior to all civil court proceedings. These amendments shall contribute to making the mediation process more attractive and relieve the overloaded courts.

 

 

After the new Mediation Ordinance entered into force on 22 June 2012, the Hong Kong Accreditation Association Limited, (HKMAAL) for mediators was setup on 02 April 2013. The founding members of the HKMAAL are some of the largest mediation centers in Hong Kong and are accredited in the

 

HKMAAL.

 

The main objective of the HKMAAL is to establish standards for accredited mediators

 

  1. Miscellaneous

 

  1. a) Follow up of SEC v. Tiger Asia Management, LLC:

 

In our newsletter Current Legal Developments in Hong Kong from July 2013, we informed you in connection with the case SEC v. Tiger Asia Management, LLC (D. N.J. Filed Dec. 12, 2012), about the fact that Hong Kong’s au-

 

 

 

 

 

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thorities have three different possibilities to pursue market misconduct. They can either:

 

  • Impose an order according to Section 213 of the Securities and Futures Ordi-nance (SFO),

 

  • Initiate criminal proceedings, or

 

  • Initiate proceedings in front of the

Market Misconduct Tribunal (MMT).

 

The Hong Kong government started to bring the new Competition Ordinance into ef-fect on 18 January 2013. More recently, on 1 August 2013 it now established a Competition Commission and appointed two presidents. Moreover it is forecasted that additional new laws and amendments will be drafted and re-leased within the next twelve to eighteen months. The entire system of regulations is expected to come into effect in 2015.

 

 

In SEC v. Tiger Asia Management, LLC (D. N.J. Filed Dec. 12, 2012) the Securities and Fu-tures Commission (SFC) has now, after already initiating proceedings according to Section 213 SFO, additionally initiated a second trial before the Market Misconduct Tribunal (MMT). This underlines how determined Hong Kong is in fighting market misconduct and how insistent Hong Kong authorities are in pursuing anticompetitive behavior.

 

  1. b) Facilitation of the development of an Isla-mic Finance Market in Hong Kong by Amending the Inland Revenue and Stamp Ordi-nance

 

Up to now, common Islamic financing structures, called Sukuk (which prohibit the charging, or paying of interest), were subject to an unfavorable tax treatment, compared to conventional bonds. For example, profits paid out in Sukuk transactions to Sukuk holders were not accepted or equated with other tax free dividend payments and there-fore did not enjoy the respective tax advan-tage.

 

To uphold its standing as an international center of finance, Hong Kong’s Inland Reve-nue Department (IRD) amended the Stamp duty Legislation (Amendment) Ordinance effective 19 July 2013. With this, Hong Kong’s Tax Law was amended in a manner that equalizes Is-lamic financing structures with all other common bonds.

 

  1. c) Current developments of Hong Kong’s Competition Law:

 

  1. d) Amendment of the Air Pollution Control Ordinance

 

The Air Pollution (Amendment) Ordinance which implements new air quality objectives was released. The following changes will be implemented as of 1 January 2014:

 

  1. New and stricter Air quality objec-tives will replace current ones,

 

  1. The Secretary for the Environment must periodically review the updated air quality objectives at least once every 5 years and submit a report of the review to the Advisory Council on the Environment, and

 

  1. the Secretary’s power to promulgate air quality objectives in a technical memorandum will be repealed.

 

It is to be hoped that Hong Kong will be able to cope with the problem of air pollu-tion so that the city secures an environmen-tally friendly and sustainable reputation.

 

 

III. Other countries

 

  1. Myanmar

 

  1. a) Myanmar signed the New York Conven-tion:

 

On   15  July   2013,  Myanmar   signed   the

 

Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Conven-tion, 1958). Myanmar and its courts are now obligated to give effect to private agree-

 

 

Legal, Tax and Business Consultants

 

 

ments and to arbitrate, recognize and en-force arbitration awards made in other con-tracting states.

 

  1. b) New Foreign Investment Law:

 

Myanmar has passed a new law called the Foreign Investment Law, which facilitates for-eign investments. Under the new foreign in-vestment law, a foreign investor may carry out business activities in Myanmar through either a wholly foreign-owned company, a joint venture enterprise with a Myanmar citi-zen, or pursuant to a contract. Not all activi-ties require local participation.

 

  1. New Zealand

 

New Zealand is estimated to have between 300,000 and 500,000 trusts, yet the law which governs them has not been changed since 1956.

 

This situation is about to change, as a new trust law shall be passed and enter into force in the near future. The last parliament debate related to this matter took place on 11 September 2013. The legislative is planning to provide clear statutory definitions clarify-ing the core features of a trust as well as the obligations of the trustees and all other per-sons involved. Additionally, the new trust law shall specify the mandatory trust duties of the trustee and the duty to provide information. The allowed duration of a New Zealand trust will be raised from the current maximum 80 years to 150 years.

 

  1. China

 

  1. a) China tightens visa regulations:

 

On 1 September 2013, China’s new Immigra-tion Law came into force and tightened visa regulations.

 

Citizens of the EU can still travel to and re-main in Hong Kong (not China!) as a tourist without a prior visa for a maximum stay of

 

90 days. These tourists could, until now, ap-ply for a so called China Express Visa in Hong Kong which was then issued within one day. This popular China Express Visa was abolished by the new Immigration Law. From now on, applicants for a China visa must be prepared to reckon with a process-ing duration of at least four working days.

 

In addition, the new law requires foreigners applying for a Chinese residence permit to provide finger prints and biometrical data to Chinese authorities.

 

The following new visa categories which are related to the purpose of the applicants stay will be introduced as of 1 September 2013:

 

  • For exchanges, visits and inspec-tions(category F)

 

  • For business or commercial activities (category M)

 

  • For overseas tourists (category L)

 

  • For entry into China for family reunification with Chinese relatives or foreigners with permanent resi-dency in China, as well as to those who need to visit China for adoption issues (category Q1)

 

  • For a temporary visit to Chinese citi-zens or foreigners with permanent residency in China (category Q2)

 

  • For relatives of foreign residents who are staying in china for study or working purposes coming to China for family reunions (category S)

 

  • Applicable to foreigners who apply to work in China (category Z)

 

  • For transit through China (category G)

 

  • Applicable to train attendants, air crew members and seamen operating international services, and to their accompanying family members (cate-gory C)

 

  • Applicable to foreign Students (cate-gory X)

 

 

Legal, Tax and Business Consultants

 

 

 

  1. Applicable to senior-level foreign tal-ents and foreign nationals whose special skills are urgently needed in China (category R)

 

  1. Applicable to foreign journalist (category J)

 

  1. Applicable to foreigners who are to reside permanently in China (cate-gory D)

 

Due to the fact that the new regulations have only been in force for a short time pe-riod, practical experiences can not yet be drawn.

 

We therefore urgently advise to consult your local Chinese embassy or consulate before traveling to China to clarify what visa cate-gory is applicable to the specific purpose of your stay and which requirements must be fulfilled.

 

It can be assumed that China wishes to limit the issuance of visas in Hong Kong to peo-ple who do not have a Hong Kong identity card. We therefore currently advise you not to apply for your China Visa in Hong Kong until more reliable information is available.

 

  1. b) New Tax Information Exchange:

 

Agreements between China and six offshore financial centers

 

Until now, China has entered into Tax Information Exchange Agreements with:

 

  1. the Bahamas,
  2. the British Virgin Islands,
  3. the Isle of Man,

 

  1. Guernsey,
  2. Bermuda and

 

 

These agreements aim to prevent income tax evasion.

 

As the Hong Kong Legislative Council decided through the Inland Revenue (Amendment) Bill 201, Hong Kong can now also independ-ently from China close and sign such information exchange agreements with the respective financial centers as of 1 July 2013.

 

 

 

 

 

 

Newsletter Nr. 166 (EN)

 

 

 

Developments in Myanmar

 

L&P Fact Finding Mission

 

 

 

October 2013

 

 

 

All rights reserved      Lorenz & Partners 2013

 

Although Lorenz & Partners always pays great attention on updating information provided in newsletters and brochures we cannot take responsibility for the completeness, correctness or quality of the information provided. None of the information contained in this newsletter is meant to replace a personal consultation with a qualified lawyer. Liability claims regarding damage caused by the use or disuse of any information provided, including any kind of in-formation which is incomplete or incorrect, will therefore be rejected, if not generated delib-erately or grossly negligent.

 

 

 

Lorenz & Partners organised a fact find-ing mission to Myanmar for clients (17-18 October 2013). With this newsletter we would like to share the outcome of this mission.

  1. Visit to the German Ambassador

 

The German Ambassador, Mr. Weber-Lortsch, comprehensively briefed our group first-hand on the current devel-opments in Myanmar. He reported on recent developments on a political level and drew interesting parallels to the de-velopments in Vietnam some 10 years ago.

 

The recent bomb attacks which at-tracted considerable attention in the press were seen by him rather as an un-avoidable side effect of the country’s re-cent liberalization than a serious threat to liberalization efforts.

 

With respect to relevant antagonistic forces still operative in Myanmar, how-ever, he opined that further challenges remain to the democratisation process until the next election in 2016 and be-yond. Nevertheless, the ambassador as-sessed the process of liberalisation as ir-reversible and had an overall positive outlook for the country’s development.

 

  1. Visit to Octagon

 

(Agent of Liebherr und Scania)

 

Octagon, a wholly Burmese owned company, can be regarded as a bench-mark for the prospects and possibilities of Myanmar.

 

 

In particular, the service station for Scania buses is run on European stand-ards, which impressively illustrates that notwithstanding the considerable effort required, production and work in My-anmar can be conducted on western standards.

 

Chan Mya, managing director of Octa-gon Co., Ltd., also regards the develop-ment in Myanmar as positive and for-ward. Ultimately, he evaluates the re-form process as irreversible, and recog-nizes distinct potential for the country. This is clearly shown by the considera-ble investment into the Scania Service Station (approx. 3.5 million USD), which is the most advanced service sta-tion in South East Asia.

  1. Visit to Myanmar Access

 

Myanmar Access is a company that supports foreign and local investors by providing capital for investments in My-anmar. It is currently pursuing various ventures, including renovation and modernization of an office building in Yangon. Furthermore, they operate a Serviced Office (where some space is still available).

 

Mr. von Rohr, Managing Director of Myanmar Access, informed that rental prices are currently skyrocketing and in top grade locations prices up to $ 100 per square meter are paid. Having said this, a cooling-off is expected in the next one to two years once more office buildings are completed.

 

 

Legal, Tax and Business Consultants

 

 

  1. Visit at VDB Loi

 

VDB Loi is a highly specialized law and tax consulting firm that has been par-ticularly active in the telecommunication sector in recent months.

 

Mr. Edmund Vanderbruggen, Managing Partner of VDB Loi Myanmar, reported on problems concerning the utilisation of land (not only related to the tele-communications sector) in the areas outside of Yangon.

 

The documentation of property owner-ship is completely lacking or is very poor; predominantly land ownership structures have not been documented at all or are inconsistent. The Burmese au-thorities are aware of such shortfalls due to the conflicting interests arising be-tween current users of the land, the formal owners and the future buyers.

 

Based on this advice, and particularly, for greenfield investments, we strongly recommend investors to seek qualified legal advice from specialists who are able to diligently investigate the land ownership structures prior to signing any contract or transferring any down-payment with respect to land.

  1. U Min Sein & Strohal Associates

 

Partnership

 

U Min Sein & Strohal Associates Part-nership has recently been set up in My-anmar and was assisting us in organizing the fact finding mission.

 

The firm is co-operating with Lorenz & Partners on business establishments of foreign investors.

 

Dr. Strohal, the Austrian lead partner of the firm and Mr. Raum, Associate of the Burmese-Austrian Joint Venture, gave interesting insights into the legal frame-work when setting up a company in My-anmar.

 

  1. Meeting with Asia World Group and Naing Group Capital Co. Ltd.

 

Asia World Group and Naing Group are two major developers in Myanmar with a variety of private or industrial projects. Together with with Myanmar Access Mr. Hellstern (Haefele Group) met representatives and he reports:

 

“Meeting these two developers was very interest-ing for our firm as it illustrated that western products have good prospects in being used in the expanding construction market in Myan-mar. We will definitely follow-up with these contacts to see if we can cooperate with them.”

 

As a consequence of the long-lasting embargo which resulted in a shortage of spare parts available in the country, it appears that developers in Myanmar possess a high awareness for quality products, which may open opportunities for European producers of such prod-ucts.

 

  1. Feedback by participants

 

Thomas Wehr, Detecon (Asia Pacific)

 

Co., Ltd:

 

“Myanmar is a market with tremendous busi-ness potential, but also significant economical risks due to various uncertainties in the busi-ness environment. Therefore your market entry needs to be prepared and ideally supported by fact-finding missions such as the one organized by L&P in October 2013. The 2-day trip was very well organized and very useful as we gained lots of operational insights and background in-formation on the local business environment from local and international business practition-ers. We can highly recommend the services from L&P if you would like to enter Myanmar, one of the last white spots on the business map in Southeast Asia.”


 

Legal, Tax and Business Consultants

 

 

Volker Hellstern, Haefele (Thailand) Co.,Ltd.

 

“The two-day program was a comprehensive fact-finding mission. The discussions and meet-ings were interesting and helpful, even for us be-ing already active in Myanmar. We appreciated the operational insights provided by local expe-rienced professionals. Furthermore, the meetings also offered various opportunities to establish contacts for potential future co-operations.”

 

Jürgen Supik, Dorsch Consult (Asia)

 

Ltd.:

 

“The trip was very well organised and gave in-teresting and brought insights into the develop-ing markets in Myanmar. We are already con-ducting business in Myanmar and I am well aware how difficult it is to obtain reliable in-formation on how to do business. The meetings arranged by Lorenz & Partners gave me useful additional insights on how business currently works in Myanmar.

 

The development in Myanmar will probably not be that quickly as currently promoted, neverthe-less, I think that it is now the right time to get engaged in order to not miss out on the oppor-tunities which this amazing country offers.


  1. Summary

 

Myanmar has a potential, but it remains to be seen how the ongoing political lib-eralisation will eventually been imple-mented within the bureaucracy. At pre-sent, the authorities are rather conserva-tive in issuing investment licences and it is still unclear how politics will support the development of the country. In any case, it makes sense to monitor the mar-ket and, if necessary, seek partners that can assist us to develop the market, e.g. as agents.

 

For companies that already have busi-ness in the region, it may be advisable to establish a presence in Myanmar, either in cooperation with companies such as Myanmar Access, or by setting up a lo-cal service company. The minimum capital being required (USD 50,000) may be well invested and can be used in order to cover local costs.

 

Obtaining a full investment licence is currently rather difficult and requires substantial time, effort and investment (depending on the industry) and appears only feasible if the investor already has substantial operating projects in the re-gion.

 

Overall, we recommend continuing to monitor the developments in the Myanmar, otherwise business opportu-nities may be missed.

 

 

 

Newsletter No. 167 (EN)

 

 

 

Thailand’s accession to the Madrid Protocol

 

 

November 2013

 

 

 

 

All rights reserved      Lorenz & Partners 2013

 

Although Lorenz & Partners always pays great attention on updating information provided in news-letters and brochures we cannot take any responsibility for the completeness, correctness or quality of the information provided. None of the information contained in this newsletter is meant to replace a personal consultation with a qualified lawyer. Liability claims regarding damage caused by the use or disuse of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected, if not generated deliberately or grossly negligent.

 

 

  1. Introduction

 

Thailand (along a number of its regional neighbours including Cambodia, Brunei, Indonesia, Laos, Malaysia, and Myan-mar), is set to join the Madrid Protocol Concerning the International Registra-tion of Trademarks (the “Madrid Pro-tocol”) in 2015.

  1. The Madrid Protocol

 

The Madrid Protocol facilitates the in-ternational protection of trademarks by allowing trademark owners to file a sin-gle trademark “International Registra-tion” on which they can designate any of the other member countries in which they wish to obtain trademark protec-tion. This process significantly reduces the trademark filing, management and renewal time and costs of trademark owners, and eases monitoring obliga-tions for authorities.

 

An International Registration may be filed by any legal entity that is domiciled or has a commercial establishment in, or is a national of, a member country of the Madrid Protocol.

 

As of 14 October 2013 the Madrid Pro-tocol had 92 member countries.

III. Reforms to the Trademark Act

 

One of the key reforms required for Thailand’s accession to the Madrid Pro-tocol, is amendment of the Trademark Act B.E. 2534 (the “Act”) to bring it in

 

line with the protocol’s regulations.

 

A draft amendment of the Trademark Act (the “Bill”) was prepared by the Department of Intellectual Property (the “DIP”), the government authority be-hind the push for membership, and ap-proved by the Cabinet.

 

In early 2012, the Bill was submitted for review by the Council of State, before final approval by Parliament.

 

Following such approval, the Bill will be announced in the Government Gazette before it comes into effect.

 

Thailand is expecting to accede to the Madrid Protocol in 2015 in order to comply with the ASEAN Economic Community Blueprint milestones for harmonisation of intellectual property protection within the region.

 

Initially, it was hoped that the Bill would come into force in late 2012 or 2013, however as of November 2013 the Bill was still being reviewed by the Council of State.

 

In addition to revising the Act, the DIP has applied for approval from the Thai Parliament for Thailand’s accession to the Madrid Protocol.

  1. Key Features of the Bill

 

  1. Description of Goods and Services

 

Applicants are no longer required to give descriptive details of their goods or services, in accordance with the Nice Classification.

 

 

Legal, Tax and Business Consultants

 

 

 

 

  1. Single Application for Multiple Clas-ses of Trademarks

 

More than one class of goods and ser-vices can be filed within one application (multi-class application).

 

  1. Significant Provisions on Registration of Trademarks under the Madrid Proto-col System

 

3.1 Registration Date

 

Once a trademark is successfully regis-tered under the Madrid Protocol system, it is deemed that the date on which the application was filed to the office of origin is the registration date.

 

3.2 Time Frame of the Issuance of Registrar’s

 

Office Notification/Action

 

The registrar is obligated to examine the trademark and issue an Office Notifica-tion/Action within 18 months from the date the application was filed notifying whether the trademark can be registered. If the registrar fails to fulfill this re-quirement within this time, it shall be deemed that the trademark is registered.

 

3.3. Central Attack System

 

Within five years from the date of regis-tration of a trademark filed in Thailand under the Madrid Protocol system, any whole or partial withdrawal, abandon-ment, refusal or cancellation of the basic application or basic registration, which is first filed or registered in the country of the office of origin, and which forms the basis for the Madrid Protocol appli-cation in Thailand, will lead to the with-drawal, abandonment, refusal or cancel-lation of the Madrid Protocol applica-tion or registration in Thailand to the same extent.

 

 

 

3.4 Conversion of Application under the Ma-drid Protocol System to Conventional Applica-tion System

 

Three months after a trademark applica-tion filed in the Madrid system is re-voked, abandoned, rejected or cancelled, the applicant may convert the applica-tion into a conventional application. The filing date under the Madrid Protocol system will be deemed as the filing date of the conventional application.

 

  1. Potential issues of subscrib-ing to the Madrid Protocol

 

The latest draft of the Bill does not re-quire any amendment to the Thai regis-trar’s current examination procedures in order to meet international standards, and as such, if the current application regime is maintained, it is likely that a large number of applications filed in Thailand under the Madrid Protocol system will be rejected.

 

Rejected applications are likely to trigger the “central attack system”, which may subsequently affect the international reg-istration of the trademark (see com-ments above).

 

 

 

Aktuelle rechtliche Entwicklungen in Hongkong

 

März 2014

 

 

All rights reserved © Lorenz & Partners 2014

 

Obwohl Lorenz & Partners große Sorgfalt darauf verwenden, die in diesen Newslettern bereitgestellten Informationen auf aktuellem Stand für Sie zur Verfügung zu stellen, möchten wir Sie darauf hinweisen, dass diese eine individuelle Beratung nicht ersetzen können. Lorenz & Partners übernimmt keinerlei Gewähr für die Aktualität, Korrektheit oder Vollständigkeit der bereitgestellten Informationen. Haftungsansprüche gegen Lorenz & Partners, welche sich auf Schäden materieller oder ideeller Art beziehen, die durch die Nutzung oder Nichtnutzung der dargebotenen Informationen bzw. durch die Nutzung fehlerhafter und unvollständiger Informationen verursacht wurden, sind grundsätzlich ausgeschlossen, sofern seitens Lorenz & Partners kein vorsätzliches oder grob fahrlässiges Verschulden vorliegt.

 

 

 

In dem nachfolgenden Newsletter möch-ten wir Sie über die neuesten rechtlichen Entwicklungen in Hongkong und Main-land China informieren.

 

  1. Besteuerung von indirekten Anteilsübertragungen in der VR China

 

Anteile an einer chinesischen Gesellschaft können indirekt übertragen werden, zum Beispiel wenn die Anteile der Muttergesellschaft, welche 100% der An-teile an der chinesischen Tochtergesell-schaft hält, übertragen werden.

 

 

 

 

 

 

Verkäufer

 

Übertrag

 

Käufer

 

 

 

 

 

 

HKG

 Holding

  

China

Co

 

 

Allerdings legte die State Administration of Taxation (SAT) in ihren Ausführungsvorschriften Guoshuihan [2009] Nr. 601 bereits 2009 fest, dass auch ein indirekter Anteilsübertrag der

 

 

ausländischen Muttergesellschaft unter Umständen in China steuerpflichtig sein kann, wenn die ausländische Muttergesell-schaft lediglich dafür eingesetzt wird, um Vorschriften in China zu umgehen und die ausländische Gesellschaft kein eigenes operatives Geschäft mit einem eigenen Geschäftszweck betreibt.

 

In der Ausführungsvorschrift Guoshuihan [2009] Nr. 698 wurde bestätigt und angeordnet, dass in einem solchen Fall die Muttergesellschaft außer Acht zu lassen ist (look through principle), und die Übertragung der Anteile den chinesischen Vorschriften unterfällt.

 

Ein eigenständiger Geschäftszweck kann hingegen zum Beispiel vorliegen, wenn die ausländische Muttergesellschaft ge-nutzt werden soll, um einen Börsengang in Hongkong oder anderswo vorzuberei-ten. In diesem Fall gehen die chinesischen Behörden davon aus, dass eine Gesell-schaft, die an der Börse notiert ist, an sich einen eigenen Geschäftszweck hat und nicht vermutet werden kann, dass eine börsennotierte Gesellschaft lediglich für den Zweck gegründet wird um chinesi-sche Regelungen zu umgehen.

 

Dagegen mussten genau in einem solchen Fall im Sommer 2013 ca. 30 Millionen Euro an Steuern an die Steuerbehörden in der Heilongjiang Provinz gezahlt werden, mit einer etwas überraschenden Begrün-dung:

 

 

Eine Gesellschaft (Cayman 1), die auf den Cayman Islands registriert ist, war 100%ige Gesellschafterin einer zweiten Cayman Islands Gesellschaft (Cayman 2), deren Anteile an der Hongkonger Börse gehandelt werden und die wiederum vier Tochtergesellschaften in China hat.

 

Cayman 1

 

 

 

U.S.

 

Übertragung

Verkäufer

 

 

Käufer

 

 

 

 

 

 

Cayman 2 (börsennotiert in HKG)

 

 

 

 

 

China

China

China

China

Co

Co

Co

Co

 

Die Anteile an Cayman 2 veräußerte und übertrug die Cayman 1 Gesellschaft an eine U.S. Gesellschaft. Gemäß Guoshui-han [2009] Nr. 698 würden bei diesem indirekten Anteilsübertrag normalerweise keine Steuern in China fällig werden, da Cayman 2 an der Hongkonger Börse gelistet ist (s.o.).

 

Entscheidend für die chinesischen Behör-den war jedoch, dass viele der leitenden Mitarbeiter und Manager von Cayman 2 in Büroräumen der chinesischen Tochtergesellschaften in China arbeiteten und von dort die Geschäfte von Cayman 2 (gelistet in Hongkong) führten und organsierten. Dies reichte für die Steuerbehörden aus, um zu entscheiden, dass das effektive Management von Cay-man 2 in China läge, sodass Cayman 2 als chinesische Gesellschaft zu qualifizieren sei und damit auch den chinesischen Steuervorschriften unterfiele.

 

 

 

 

Dies ist der erste Fall, in dem so argumen-tiert wurde und es bleibt abzuwarten, ob weitere chinesische Steuerbehörden dieser

 

Argumentationslinie folgen werden. In der Zwischenzeit ist allerdings zu raten, nicht nur die Strukturierung von Geschäften in China, sondern auch Anteilsübertragungen genau zu planen. Es ist darüber hinaus auch weiter zu überle-gen, wie Managementpositionen in China zu besetzen sind.

 

III. Steuerrecht in Hongkong

Am 12. November 2013 hat das höchste Hongkonger Gericht, der Court of Final Appeal, die Entscheidungen der Unterge-richte (Court of First Instance und Court of Appeal) bestätigt, dass nicht realisierte Gewinne beim Handel mit Aktien nicht zu versteuern sind. In Nicer Cheer Invest-ment Limited v. Commissioner of Inland Revenue (CIR) wollten die Hongkonger Steuerbehörden nicht realisierte Gewinne in Höhe von ca. 250 Millionen HKD (ca. 25 Millionen Euro) der Investmentgesell-schaft „Nicer Cheer“ der Profits Tax unterwerfen. Hiergegen wehrte sich die Gesellschaft erfolgreich vor dem Court of First Instance und das Revisionsgericht, der Court of Appeal, bestätigte dieses Ur-teil. Das höchste Hongkonger Gericht ur-teilte ebenfalls im Sinne des Steuerzahlers und argumentierte, dass steuerbare Ge-winne nach Section 14 der Hongkong In-land Revenue Ordinance nur Gewinne sind, die tatsächlich entstanden sind und nicht solche, die nur aus einer Neubewer-tung von Wertgegenständen herrührten.

 

Dem Court of Final Appeal wurde nicht die Frage vorgelegt, ob dies auch für Ver-luste gilt (ob also Verluste erst steuermin-dernd geltend gemacht werden können, wenn sich diese realisiert haben). Hierzu erklärte der Court of Final Appeal aller-dings in einem nicht bindenden Obiter Dictum, das Verluste unter Umständen schon dann abzugsfähig sind, wenn diese dauerhaft sind und sich bereits in gewisser Weise niedergeschlagen haben. Dies kannnun unter Umständen zu der Situation führen, dass nicht realisierte Gewinne nicht zu versteuern sind, anderseits aber nicht realisierte Verluste bereits abzugsfä-hig sind.

 

Allerdings wird damit zu rechnen sein, dass die Steuerbehörden in Kürze Ausfüh-rungsvorschriften erlassen werden, um zu versuchen, die Anwendung dieser neuen Rechtsprechung zu begrenzen. Diese An-wendungsvorschriften sind nicht bindend und der Fall wird in den nächsten Jahren seine Fortsetzung mit der Frage finden, ob nicht realisierte Verluste abzugsfähig sind und wenn ja, unter welchen Voraussetzungen.

 

wirksam ist. Es ist anerkannt, dass eine solche Vereinbarung zum Schutz gerechtfertigter Geschäftsinteressen des Arbeitgebers, so insbesondere zum Schutz von Betriebsgeheimnissen, vertraulichen Informationen, Kundenkontakten und der Stabilität der Belegschaft dienen kann. Eine geltungserhaltende Reduktion von zu weitreichenden Klauseln ist grundsätz-lich möglich, wird aber nicht durchge-führt, soweit die Klausel ein unangemes-sen weites Wettbewerbsverbot in temporärer und geografischer Hinsicht bestimmt.

 

 

Dieser Grundsatz wurde in den folgenden drei rechtshängigen Verfahren in den Vorinstanzen nochmals bestätigt:

 

 

  1. Arbeitsrecht Hongkong
  • Nachvertragliche Wettbewerbsverbotsklauseln

 

Eine immer wieder diskutierte und von den Gerichten zu entscheidende Frage ist die Wirksamkeit von nachvertraglichen Wettbewerbsklauseln im Arbeitsrecht, ob es also einem Arbeitnehmer nach Ausscheiden aus einem Arbeitsverhältnis verboten werden kann, innerhalb einer bestimmten Zeit für einen Konkurrenten zu arbeiten.

 

 

Hierzu ergingen drei neue Gerichtsentscheidungen:

 

Grundsätzlich ist eine nachvertragliche Wettbewerbsverbotsklausel unwirksam, da sie gegen die Arbeitnehmerfreizügig-keit von Art. 33 und 41 des Hongkong Basic Law verstößt.

 

Allerdings haben Hongkonger Gerichte immer wieder darauf hingewiesen, dass dieser Grundsatz nicht starr gilt, sondern im Einzelfall abgewogen werden muss, ob ein nachvertragliches Wettbewerbsverbot

 

Union Gain Ltd. v. Chu Wilton Lucas, DCCJ 2383/2013 (29 August 2013), Judge Wilson Chan

 

Pure International (HK) Ltd. v. Lo Yan Chak Kenneth, HCA 975/2013 (12 July 2013), Deputy Judge Seagroatt, und

 

WPP Marketing Communication (Hong Kong) Ltd. v. Christopher O`Donnel, HCA 637/2013 (24 May 2013), Recorder Paul Shieh SC

 

 

In zwei der Fälle wurde die Wirksamkeit abgelehnt, nur in einem der Fälle (Pure In-ternational) wurde von den Gerichten das Wettbewerbsverbot aufrechterhalten.

 

Nach der Hongkonger Rechtsprechung muss das nachvertragliche Wettbewerbs-verbot angemessen sein, das heißt, es wird überprüft, ob das Wettbewerbsverbot den Arbeitnehmer nicht zu stark in seinem Recht auf Arbeit einschränkt. Dies wird vor allem an den beiden Faktoren „Zeit“ und „geographische Ausdeh-nung“ gemessen.

 

Wettbewerbsverbote über die Dauer von 12 Monaten werden eher selten als wirk-sam angesehen, dies ist aber auch wiede-rum abhängig von der Seniorität des Angestellten.

 

Weiterhin sollte das Gebiet, auf das sich das Wettbewerbsverbot bezieht, räumlich sehr genau umschrieben werden und sich maximal auf das Gebiet beschränken, in welchem der Arbeitnehmer davor tätig war. Ein gutes Beispiel hierfür ist das Wettbewerbsverbot in dem Fall Pure International, in welchem es einem Fitnesstrainer nicht gestattet war, in ei-nem Umkreis von 600 Metern zu seinem ehemaligen Fitnessstudio zu arbeiten.

 

Eine finanzielle Entschädigung ist nicht zwangsläufig notwendig, um die Wirk-samkeit eines Wettbewerbsverbots sicher zu stellen, kann aber als einer der Fakto-ren zur Beurteilung der Wirksamkeit in Betracht gezogen werden. Das heißt ein Wettbewerbsverbot ohne Entschädigung ist nicht automatisch unwirksam, anderer-seits wird eine finanzielle Entschädigung ein unangemessenes Wettbewerbsverbot grundsätzlich nicht in ein angemessenes wandeln.

 

  • Vorsicht bei fristlosen Kündigun-gen

 

In dem Rechtsstreit Grant David Vincent Williams v. Jefferies HK Ltd. (2013) ent-schied der Hongkonger High Court, dass die sofortige Kündigung eines Arbeitneh-mers nicht gerechtfertigt ist, wenn sie übereilt und ohne ordnungsgemäße Über-prüfung des Geschehensablaufes bzw. der der Kündigung vorangegangenen Ereig-nisse erfolgt.

 

Bei vermeintlichen Fehlern des Arbeit-nehmers ist diesem zunächst Gelegenheit zu geben, sich zu den Vorwürfen zu äu-

 

ßern. Da dies in dem Fall nicht geschehen war, sprach das Gericht dem entlassenen Arbeitnehmer eine Entschädigung von ca. 1,6 Millionen Euro zu. Das Gericht begründete dies damit, dass der Fall einige „extrem unerfreuliche Besonderhei-ten“ aufweise. Der Kläger und fristlos entlassene Arbeitnehmer veröffentlichte ohne Zustimmung seiner Vorgesetzten ein Video, in welchem unter anderem Adolf Hitler vorkam. Hierauf kündigte der Arbeitgeber sofort außerordentlich, ohne die genauen Tatsachen zu recherchieren und dem Mitarbeiter die Möglichkeit zur Rechtfertigung zu geben. Dies war unangemessen, urteilte das Ge-richt, da der Arbeitgeber hätte überprü-fen müssen, ob tatsächlich ein Grund zu einer außerordentlichen Kündigung vor-lag. Da er dies nicht tat, verstieß er gegen seine arbeitsrechtliche Treuepflicht, was den Schadensersatzanspruch auslöste.

 

In Anbetracht dieser Entscheidung ist zu raten, genau zu überprüfen, ob ein Grund für eine außerordentliche Kündigung vor-liegt. Dies ist nach Hongkonger Recht-sprechung nur dann der Fall, wenn die Fortsetzung des Arbeitsverhältnisses bis zum Ende der regulären Kündigungsfrist

 

nicht zumutbar ist. Da es in Hongkong grundsätzlich keine Sozialauswahl bei Kündigungen gibt, sind Hongkonger Ge-richte sehr zurückhaltend, eine außerordentliche Kündigung als rechtmä-ßig anzusehen.

 

  • Weitere Entwicklungen

 

  • Wirksamkeit von Gerichtsstands-vereinbarungen nach Hongkon-ger Recht

In Hyundai Engineering & Construction Co., Ltd. v. UBAF (Hong Kong) und Bank of China Limited wurde vom Court of

 

 

 

 

 

First Instance (Hongkong) eine Ge-richtsstandsvereinbarung zugunsten der Hongkonger Gerichte und der Anwen-dung Hongkonger Rechts zwischen Par-teien aus Hongkong und Mainland China als wirksam erachtet und damit die Recht-sprechung der Hongkonger Gerichte wei-ter gefestigt.

 

Aufgrund einer Gerichtsstandsvereinba-rung reichte ein Kläger gegen eine chine-sische Gesellschaft in Hongkong Klage ein. Die chinesische Gesellschaft reichte wiederum in China Klage gegen die Hongkonger Gesellschaft ein und stützte die Zuständigkeit der chinesischen Ge-richte auf das allgemeine chinesische Zivilprozessrecht. Nachdem beide Ge-richte (in Hongkong und China) die Kla-gen jeweils zuließen, stellte die chinesi-sche Gesellschaft den Antrag an das Hongkonger Gericht, dessen Zuständig-keit zu verneinen und berief sich auf die Unwirksamkeit der Gerichtsstands-vereinbarung. Diesem gab das Hong-kon-ger Gericht nicht statt und sowohl in China als auch in Hongkong werden die Klagen nun weiter verhandelt und es darf davon ausgegangen werden, dass es zu wi-dersprüchlichen Entscheidungen kom-men wird.

 

Die durch das Hongkonger Gericht vertretene Auffassung ist, dass Ge-richtsstandsvereinbarungen privatrechtli-che Vereinbarungen zwischen den Par-teien darstellen, die nur in Ausnahmefäl-len als nicht wirksam angesehen werden könnten, da die Parteien sich üblicher-weise bereits vor Abschluss des Vertrages Gedanken über das anzuwendende Recht und das zuständige Gericht im Falle von Streitigkeiten gemacht haben. Die Vermeidung von sich widersprechenden Entscheidungen verschiedener Gerichte in Hongkong und Mainland China hinsichtlich desselben Sachverhalts kann kein Argument gegen die Wirksamkeit ei-

 

ner Vereinbarung sein. Die Unwirksam-keit einer Gerichtsstandvereinbarung muss auf schwerwiegenden Gründen beruhen um dies zu rechtfertigen. Weiter-hin sei irrelevant wie erfolgversprechend eine Klageforderung ist.

 

Es bleibt abzuwarten wie die Gerichte je-weils urteilen werden und wie die Par-teien mit sich widersprechenden Urteilen umgehen und diese vollstrecken werden.

 

  • Liquidation einer ausländischen Gesellschaft

 

Es ist in Hongkong grundsätzlich mög-lich, dass Gläubiger an das Hongkonger Gericht einen Antrag auf Liquidation ei-ner ausländischen Gesellschaft stellen, selbst wenn diese in Hongkong nicht registriert ist, und Vermögensgegen-stände, vor allem Bankguthaben in Hong-kong dann den Gläubigern zugutekom-men kommen zu lassen, die vom Liquida-tor dann entsprechend den Hongkonger Gesetzen an die Gläubiger ausgekehrt werden.

 

 

Gefestigte Hongkonger Rechtsprechung ist hierzu aber, dass die ausländische Gesellschaft hinreichend enge Kontakte zu Hongkong haben muss, bevor das Hongkonger Gericht einer anderen Rechtsordnung unter Umständen vor-greift und die Liquidation einer ausländi-schen Gesellschaft anordnet. Dies wurde in Armada (Singapore) Pte Ltd. vs. Grand China Logistics Holdings (Group) Co. Ltd. (2013) HKEC, 1517 nochmals bestätigt.

 

  1. Trust Law Reform

 

Wie bereits in unserem letzten Newsletter 164D berichtet, trat zum 01. Dezember 2013 das neue Trust Law in Hongkong in Kraft, welches das alte Recht, welches seit 1934 kaum geändert wurde, ersetzt. Zuden Neuerungen und Änderungen verweisen wir auf unseren Newsletter. Es wird abzuwarten sein, ob Hongkong den Vorsprung anderer Jurisdiktionen wie Singapur, England, Australien, etc., wel-che schon bereits seit vielen Jahren ein moderneres Trust Law haben, aufholen kann. Insbesondere bleibt es abzuwarten, ob mit der einhergehenden Änderung des Hongkonger Handels- und Gesell-schaftsrechts, welches im März 2014 in Kraft trat, neue Impulse für die Trust In-dustrie in Hongkong gegeben werden können.

 

  1. Neue MPF Regeln

 

Kurz möchten wir darauf hinweisen, dass die Einkommensuntergrenze für Manda-tory Provident Funds (MPF) Beiträge zum November 2013 auf 7,100 HKD (ca. 710 Euro) erhöht wurde. Arbeitgeber, de-ren Angestellte oder Arbeitnehmer über dieser monatlichen Einkommensschwelle liegen, haben die Beiträge für Arbeitgeber und Arbeitnehmer (je 5% des Monats-lohns, max. jedoch je 1,125 HKD, ca. 110 Euro) einzubehalten und abzuführen. Für monatliche Einkommen unter dieser Grenze hat lediglich der Arbeitgeber Bei-träge zu leisten, der Arbeitnehmer ist freigestellt.

 

  1. Neues Luftreinhaltungsgesetz

 

Das Hongkonger Luftreinheitsgesetz (Air Pollution Control Ordinance, Cap. 311) soll auf asbesthaltige Materialien erweitert werden, die weniger als ein Prozent As-best enthalten. Weiterhin werden die Vorschriften für den Umgang mit solchen Materialien verschärft. Für die Lieferung, den Import und die Verladung von asbest-haltigen Stoffen ist eine Geldstrafe von 200.000,00 HKD und eine Freiheitsstrafe von 6 Monaten vorgesehen.

 

Es darf gehofft werden, dass mit dieser Änderung ein positiver Beitrag zur Verbesserung der Luftqualität geleistet wird.

 

  1. Entwicklungen in anderen Län-dern
  2. Myanmar

 

Seit der Öffnung Myanmars gegenüber größeren ausländischen Investitionen, durch die aufgehobenen Sanktionen, ist auch die Sicherung von Trademarks mehr in den Fokus gerückt. Zu beachten ist allerdings, dass das Markenrecht in Myan-mar größtenteils noch auf einem Gesetz aus dem Jahre 1860(!) beruht, sodass hier mit Sicherheit noch großer Nachholbe-darf besteht. Um eine Marke in Myanmar registrieren zu können ist grundsätzlich notwendig, dass:

 

  • der Antragsteller aus Myanmar kommt (ausländische Antragsteller müssen sich eines lokalen Agenten be-dienen).

 

 

  • Es muss eine förmliche Erklärung abgegeben werden, dass die Marke tat

 

 

  • sächlich im Eigentum des Antragstel-lers steht.

 

  • Die Marke muss (nicht notwendiger-weise in Myanmar selbst) genutzt wer-den.

 

Außerdem ist es sinnvoll, bei einer Markenregistrierung eine Mitteilung in ei-ner großen nationalen Zeitung zu veröffentlichen, in der auf die Marke und den Eigentümer hingewiesen wird. Diese Mitteilung sollte regelmäßig (ca. alle drei Jahre) wiederholt werden.

 

Weiterhin trat in Myanmar am 30. Au-gust 2013 das neue Arbeitsgesetz („Employment and Skill Development Act”) in Kraft. Gemäß diesem Gesetz sol-len zwei Regierungskommissionen gebil-det werden, die sich um die Entwicklung des Arbeitsmarktes kümmern sollen. Hierbei ist unter anderem geplant, dass Arbeitgeber in bestimmten Zweigen ca. 0.5% des Bruttoarbeitslohns in einen Fonds einzahlen sollen, der dann der Ausbildung von Arbeitern zugutekom-men soll.

 

 

Weiterhin führt das Gesetz detailliert aus, welche Regelungen in einem Arbeitsver-trag enthalten sein müssen und es ist vorgesehen, dass jeder Arbeitsvertrag von einer öffentlichen Stelle überprüft und ge-nehmigt werden soll.

 

Es ist zu hoffen, dass diese Vorschriften ein Schritt in die richtige Richtung sind und sich die Regierung von Myanmar hiermit nicht selbst ein Bein stellt, indem sie verschiedene Regelungen zu kompli-ziert gestaltet und damit schlussendlich ausländische Investoren abschreckt.

 

  1. Philippinen

 

Im Streit zwischen den Philippinen und China bzgl. der Gebietsansprüche im Süd-chinesischen Meer weigert sich China an dem von den Philippinen eingeleiteten Schiedsgerichtsverfahren gemäß der UN Seerechtskonvention teilzunehmen. Das Verfahren wurde am 22. Januar 2013 von den Philippinen eingeleitet, bereits am 19. Februar 2013 wies China aber die Teil-nahme an dem Verfahren zurück. Dies wurde am 01. August 2013 nochmals wie-derholt. Es ist nicht ganz ungewöhnlich, dass Arbitration zwischen zwei Staaten in Abwesenheit des einen Staates durchge-führt wird, von daher wird es interessant

 

sein zu sehen, wie das Verfahren fortge-setzt wird.

 

  1. Vietnam

 

In Vietnam wird die Lockerung der Anteilsbeschränkungen ausländischer In-vestoren an vietnamesischen Banken in Er-

 

wägung gezogen (Decree 69/2007/ND-CP (Decree 69)).

 

Bisher dürfen ausländische Investoren lediglich an einer Bank Beteiligungen in Höhe von 5% erwerben. Nach dem neuen Gesetz können ausländische Investoren 15 – 20% an vietnamesischen Kreditinstituten erwerben. Es bleibt abzu-warten, ob diese eher kleine Änderung helfen wird, ausländische Investoren da-von zu überzeugen, Anteile an vietnamesischen Banken zu übernehmen.

 

  1. Neuseeland

 

Ähnlich wie in Hongkong wird in Neuseeland an einer Modernisierung des Trust Laws gearbeitet. Die Reform soll vereinfachte Verfahren im täglichen Ge-schäft von Fonds ermöglichen und die Kosteneffizienz steigern. Weiterhin sollen

 

die Rahmenbedingungen für die Grün-dung von Fonds festgeschrieben werden und die Vorschriften über die Vollmach-ten der Verwalter, sowie das Verfahren für die Ernennung und Abberufung von Verwaltern beschlossen werden. Zudem sollen modernisierte, flexiblere Investiti-onswege ermöglicht werden.

 

 

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