Three New Cabinet Decisions Regarding Corporate Tax and Tax Procedures Announced – Summary

August 7, 2023
Introduction On 28th of July 2023, the UAE Ministry of Finance published three new Cabinet Decisions pertaining to corporate tax and tax procedural law: Cabinet Decision No. 74 of 2023 On the Executive Regulation of Federal Decree-Law No. 28 of 2022 on Tax Procedures (further also as the “CD No. 74 of 2023”). Cabinet Decision No. 75 of 2023 On the Administrative Penalties for Violations Related to the Application of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (further also as the “CD No. 75 of 2023”). Cabinet Decision No. 81 of 2023 On Conditions for Qualifying Investment Funds for the Purposes of Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (further also as the “CD No. 81 of 2023”). The first two legal acts came into force on 1st August 2023, whereas CD No. 81 of 2023 should come into effect the day following the date of its publication. At the time of writing this alert, CD No. 81 of 2023 is not yet officially published in the official UAE Gazette. 1. Tax Procedural Changes – CD No. 74 of 2023 On 30th September 2022, a new tax procedural law has been published under the Federal Decree-Law No. 28 of 2022, with 1st March 2023 marked as the date of entering into force, replacing Federal Decree-Law No. 7 of 2017.   However, the executive regulations that were issued under the Federal Decree-Law No. 7 of 2017 (Cabinet Decision No. 36 of 2017) remained in force, creating interpretational problems, especially around the Voluntary Disclosure obligation. The discussed CD No. 74...

New regulations on onshore loans and offshore loans in Vietnam

July 26, 2023
The State Bank of Vietnam further tightens the rules but provides some favorable clarifications. Towards the end of June 2023, the State Bank of Vietnam (“SBV”) issued two important circulars governing the credit market in Vietnam: Circular 08/2023/TT-NHNN (“Circular 08”) on offshore borrowing conditions to replace Circular 12/2014/TT-NHNN on the same subject matter; and Circular 06/2023/TT-NHNN (“Circular 06”) amending and supplementing certain articles of Circular 39/2016/TT-NHNN on lending activities of credit institutions and foreign bank branches in Vietnam (“credit institutions”). Circular 08 will take effect on 15 August 2023 while Circular 06 will take effect on 1 September 2023. This article provides an overview of the major changes introduced by Circular 06 and Circular 08 and their implications. I. HIGHLIGHTS OF IMPORTANT CHANGES Onshore Loans It is no longer permissible to provide onshore loans to fund the deposit of monies or to fund equity investments other than listed stock investments. Financing capital contributions under capital contribution contracts, investment cooperation contracts, or business cooperation contracts for an investment project that does not meet the eligibility criteria for “being put into business” under relevant laws is prohibited but it is unclear how to determine if a project is eligible “for putting into business.” A legal regime for digital lending is introduced. Each individual may not maintain a total outstanding digital borrowing balance of more than VND100,000,000 with a credit institution. More stringent and detailed requirements on internal lending regulations are imposed on credit institutions. Costs which are funded by reimbursement loans must have incurred within 12 months prior to the credit institution’s decision to lend. Offshore Loans All categories of borrowers...

A New Vision for Corporate Lawyers by Peter Connor

July 26, 2023
Q&A with Peter Connor, founder of AlternativelyLegal, and author of the book ‘A New Vision of Corporate Lawyers’. Can you give us an overview of your book and explain how it addresses the concept of human transformation in the field of corporate law? The book makes the case for why corporate lawyers, legal departments and firms should head in a different direction and adopt a new paradigm. It outlines the changing landscape for lawyers, then defines the change imperative, before painting a very clear picture of what the future could look like. That new vision is for lawyers to become businesspeople, not just lawyers; to regularly provide business input and advice, not just legal advice; and to regularly do business work, not just legal work. I refer to such a lawyer as a T-Shaped Lawyer, a form of legal expert business generalist as shown below. That is what I mean by human transformation – fundamentally changing the work that lawyers do and their capabilities to do that new work. Re-imagining your work and reinventing yourself. Why adopt this new vision? The book outlines various reasons but the primary reason is because it turns out that working in the business, not on the business, is the best way to add more value for, and as a result be more valued by, clients. How do I know that? Through my own personal experience working as a lawyer for about 30 years around the world and from the feedback from thousands of lawyers in my workshops who are attracted to this vision but are still in the process of adopting it. The...

Europe-Asia Great Divide in Regulating the Digital Economy

July 26, 2023
FRENY PATEL The proliferation of the Internet and the critical role of technology players in our daily lives have regulators grappling with how best the digital economy should be regulated against the anti-competitive behaviour of large online platforms. Europe has taken the lead towards ex-ante regulations with the Digital Markets Act (“DMA”), which came into effect a little over a month ago on 2 May 2023. The DMA sets the ground rules on what is acceptable behaviour. The DMA is aimed at reining in ‘Big Tech’ and their alleged abuse of power, but is still a work in progress. Digital platforms, often identified as gatekeepers, have the tendency to adopt a winnertakes-all approach and monetize market data. The idea behind ex-ante regulations is to truncate the time period and intervene before the market is entrenched with one or two players. However, a Singapore-based policy director with a leading multinational digital platform recently voiced concerns and cautioned enforcers in the Asia Pacific region to tailor digital regulations according to local economies, given the far-reaching implementation costs of ex-ante rules and the overarching implications. Unlike the European Commission, most Asian enforcers are still sitting on the fence, deliberating on how digital economies should be regulated and whether ex-ante rules are the solution or even warranted. There is clearly a Europe-Asia great divide on how the digital economy should be regulated. Each inquiry requires more time and by the time authorities complete the investigations, reach a finding, and issue directives, the markets may irreversibly tip in favour of the leaders The debate on the need to relook at antitrust enforcement tools has...

The Greater China IP Update – July 2023

July 24, 2023
Taiwan Chips Act Sets Research and Development Spending at NT6 Billion The Ministry of Economic Affairs sets the research and development investment threshold at NT6 billion for companies to qualify for tax incentives under recently approved amendments to the Act for Industrial Innovation – Taiwan’s version of the US Chips and Science Act.  The announcement was made on May 2, 2023.  That sum was slightly less than the government’s original threshold of between NT5 billion and NT10 billion.  However, it is much higher than the average annual R & D expenditure of NT3 billion that the nation’s top 100 companies have committed to over the past few years.  Another requirement is that companies need to set aside at least 6% of their revenue for R & D in order to receive the tax incentives.  The targets of the government’s initiative are those companies in Taiwan that are strategically important to global supply chains.  It is also hoped that the program will encourage more overseas Taiwanese businesses to invest back home.  Besides semiconductor firms, the program is also applicable to companies that are capable of developing world-leading or innovative and scalable technology in strategic industries such as 5G, electric vehicles and low Earth Orbit Satellites.  The new tax incentives will be in place for seven years, starting this year, and the ministry will start accepting applications next year based on their investments this year.  Taiwan Semiconductor Manufacturing Co. is widely considered to be on top of what is likely to be a short list of companies eligible for tax breaks as the world’s biggest contract chipmaker plans to allocate about...

Recent Trends of Enforcement of Anti-Trust and Trade Competition Law in Thailand

July 12, 2023
PRANAT LAOHAPAIROJ The Trade Competition Act B.E. 2560 of Thailand (“Act”) was enacted in 2017 and is the second version of the anti-trust and trade competition law in Thailand. Its predecessor is the Trade Competition Act B.E. 2542, which was enacted in 1999 and saw very little usage due to a lack of necessary supplementary regulations and will of the government and the public to put the law to use. During the 18 years of its existence, the 1999 law only saw action a few times, with all of the cases dropped due to lack of evidence or governing support. The Act is the reincarnation of the 1999 law, with most of the provisions transposed from the 1999 law onto the Act almost verbatim, but with minor differences regarding categorisations and re-classifications of penalties and other minor details. The Act was deemed appropriate to change the competition landscape in Thailand in order to promote more holistic competition within the economy and enhance understanding between different stakeholders and the governing authority. The Act is also intended to extinguish, or at least limit, unnecessary hindrances to trade that had (and to some extent nowadays still have) existed because of historical trade practices and unique cultural conduct. These practices and conduct, such as arrangement, exclusivity, resale price maintenance, unfair poaching, cost imposition, have largely been banned in countries that have enacted their version of anti-trust and trade competition law, and Thailand was deemed ready to follow suit. The Trade Competition Commission of Thailand (“ TCCT ”), which is the governing authority over the Act, was very clear that during the first few...