{"id":22495,"date":"2023-04-20T14:27:45","date_gmt":"2023-04-20T12:27:45","guid":{"rendered":"https:\/\/www.lpalaw.com\/?p=22495"},"modified":"2023-06-30T18:47:15","modified_gmt":"2023-06-30T16:47:15","slug":"lpa-asia-smart-news-2023-04","status":"publish","type":"post","link":"https:\/\/www.lpalaw.com\/en\/lpa-asia-smart-news-2023-04\/","title":{"rendered":"LPA Asia Smart News"},"content":{"rendered":"

\"\"<\/p>\n

Through this newsletter, we offer you a regular selection of legislative and judicial decision insights prepared by LPA lawyers from its 4 Asian offices as well as some recent news from our teams.<\/p>\n

SMART ALERT<\/a><\/span>
\n<\/a>Is your business impacted by the new Foreign-sourced Income Exemption regime in Hong Kong?<\/a><\/p>\n

LEGAL INSIGHTS IN ASIA\u00a0<\/a><\/span>
\n> Hong Kong<\/a>
\n\u00a0 \u00a0– Hong Kong seeks to attract foreign talents\u00a0<\/a>
\n\u00a0\u00a0 – Hong Kong\u2019s copyright law catches up with the digital age\u00a0<\/a><\/p>\n

> China<\/a>
\n\u00a0 \u00a0– Retirement Policy for Foreigners in China\u00a0<\/a>
\n\u00a0 \u00a0– Significant Increase of trademark rejections in China!\u00a0<\/a><\/p>\n

> Singapore<\/a>
\n\u00a0 \u00a0– Recent employment law updates\u00a0<\/a>
\n\u00a0 \u00a0– Multijurisdictional Cash-pooling agreement \u2013 do handle with care!\u00a0<\/a><\/p>\n

> Japan<\/a>
\n\u00a0 \u00a0– Relocating and setting up a new business gets easier in Japan\u00a0<\/a>
\n\u00a0 \u00a0– Commercial registration and signature certificate for directors<\/a><\/p>\n

NEWS FROM LPA<\/a><\/span><\/p>\n

 <\/p>\n

\n

<\/a>SMART ALERT<\/h2>\n

<\/a>Is your business impacted by the new Foreign-sourced Income Exemption regime in Hong Kong?<\/strong><\/p>\n

On 1 January 2023, the Inland Revenue (Amendment) (Taxation on Specified Foreign-sourced Income) Ordinance 2022, came into operation. Under the new legislation, specified foreign-sourced income generated by a multinational enterprise (MNE) carrying on an activity in Hong Kong are to be regarded as arising in or derived from Hong Kong and therefore chargeable to profits tax if and when they are received in Hong Kong unless the MNE entity has a sufficient economic substance in Hong Kong or meets alternative requirements. See more\u00a0<\/em><\/a><\/p>\n

 <\/p>\n

<\/a>LEGAL INSIGHTS IN ASIA<\/h2>\n

<\/a>\"\"<\/p>\n

<\/a>Hong Kong seeks to attract foreign talents\u00a0<\/strong><\/p>\n

To jumpstart its post-COVID economy, the Hong Kong government is pulling out all stops to attract and retain talents from Mainland China and abroad.\u00a0 A barrage of initiatives and incentives aims to lure senior staff, highly skilled university graduates and qualified persons in professions for which no local candidates are available in Hong Kong.\u00a0\u00a0<\/span><\/p>\n

Top Talent Scheme\u00a0<\/span><\/p>\n

The Top-Talent Pass Scheme targets non-Hong Kong individuals holding senior positions or excellent academic qualifications with a preference for those who have work experience.\u00a0 <\/span>Applicants need to meet any of the following conditions:\u00a0<\/span>\u00a0<\/span><\/p>\n

    \n
  1. an income of at least HKD 2.5 million in the most recent year;<\/span>\u00a0<\/span><\/li>\n
  2. a bachelor\u2019s degree from a top 100 university and no less than 3 years\u2019 work experience during the recent 5 years; or\u00a0<\/span><\/li>\n
  3. a bachelor\u2019s degree from a top 100 university obtained in the past 5 years, subject to a quota of 10,000 places if the applicant has less than 3 years of work experience.<\/span><\/li>\n<\/ol>\n

    The applicants are not required to have secured an offer of employment in Hong Kong at the time they apply.\u00a0 They are eligible to stay a maximum of 24 months without conditions other than normal immigration requirements, such as holding a valid travel document, having a clear criminal record, etc.\u00a0 Successful applicants can bring their dependants to Hong Kong and such dependants are allowed to take up employment or study in Hong Kong.<\/span>\u00a0<\/span><\/p>\n

    Relaxation of overseas hiring requirements\u00a0\u00a0<\/span><\/p>\n

    The General Employment Policy (the \u201cGEP\u201d) makes it easier for local employers to hire overseas professionals for which no candidates are readily available in Hong Kong.\u00a0 Employers may seek to employ foreign professionals under the GEP if the following conditions are satisfied:\u00a0<\/span>\u00a0<\/span><\/p>\n

      \n
    1. the applicant has a good education background, normally a first degree in the relevant field, but in special circumstances, good technical qualifications, proven professional abilities and\/or relevant experience and achievements supported by documentary evidence may also be accepted;<\/span>\u00a0<\/span><\/li>\n
    2. there is a genuine job vacancy;<\/span>\u00a0<\/span><\/li>\n
    3. the applicant has a confirmed offer of employment at a normal remuneration<\/span><\/li>\n<\/ol>\n

      A similar scheme is available for professionals from Mainland China under the Admission Scheme for Mainland Talents and Professionals (the \u201cASMTP\u201d).\u00a0 The Mainland professionals that may be hired under the ASMTP must possess special skills not readily available in Hong Kong.\u00a0 The employers hiring professionals under the GEP and ASMTP can benefit from a relaxation of the bureaucratic burden when applying for visas such as no longer having to prove that they cannot fill the position with local professionals.\u00a0 Another measure aimed at attracting new talent is the suspension of the annual quota under the Quality Migrant Admission Scheme for a period of 2 years.<\/span>\u00a0<\/span><\/p>\n

      Extension of visa validity\u00a0<\/span><\/p>\n

      Further measures to retain qualified professionals in Hong Kong include (a) the extension to a maximum of 3 years of the validity of the employment visas issued to talents admitted under the previous and the new talent admission schemes; and (b) the extension from 1 to 2 years of the validity of the visas of foreign graduates of Hong Kong universities who have been permitted to stay and work in Hong Kong under the Immigration Arrangement for Non-local Graduates (the \u201cIANG\u201d).\u00a0<\/span>\u00a0<\/span><\/p>\n

      Refund of stamp duty paid for the purchase of residential property in Hong Kong\u00a0<\/span><\/p>\n

      Individuals admitted under any of the foreign talent admission schemes (including the Top-Talent Pass Scheme, GEP, ASMTP, IANG and others) who purchase a residential property in Hong Kong and subsequently become Hong Kong permanent residents can apply for a refund of the \u201cBuyer\u2019s Stamp Duty\u201d and the \u201cNew Residential Stamp Duty\u201d paid on the first residential property purchased and still owned in Hong Kong.\u00a0<\/span>\u00a0<\/span><\/p>\n

      Camilla Venanzi<\/a> | Erik Leyssens<\/a> | Nicolas Vanderchmitt <\/a><\/span><\/span>\u00a0<\/span><\/a><\/p>\n

       <\/p>\n

      <\/a>Hong Kong\u2019s copyright law catches up with the digital age\u00a0<\/strong><\/p>\n

      Hong Kong is updating its copyright law with the Copyright (Amendment) Ordinance 2022 (the \u201cAmendment<\/span>\u201d) which enters into effect on 1 May 2023.\u00a0 The Amendment provides better protections and clarity to copyright owners, users and providers in an era where technological developments have changed the ways in which copyrighted works are communicated, stored and used.<\/span>\u00a0<\/span><\/p>\n

      The Amendment\u2019s key areas of reform are:<\/span>\u00a0<\/span><\/p>\n

        \n
      1. Recognising copyright owners\u2019 exclusive and technology-neutral right to communicate their works to the public through any mode of electronic transmission<\/em>. Whereas the existing regime limited copyrights to the “copying”, “performing, showing or playing” or “broadcasting” of works, the Amendment extends the right to all types of communication. Copyright owners will thus be permitted, for example, to take action against any unauthorized streaming of their works.<\/li>\n
      2. Imposing criminal sanctions for certain forms of communicating copyrighted works<\/em>. Persons may be liable to criminal prosecution if they communicate copyrighted works to the public (a) for the purpose, or in the course of, a trade of business, for profit or reward; or (b) to an extent that the copyright owner suffers a prejudic They may defend against an accusation of copyright infringement by proving not to have known that the communication of the work amounted to infringement.<\/li>\n
      3. Introducing exceptions to the exclusive nature of copyrights<\/em>.\u00a0 The following use or transmission of copyrighted works will not constitute infringements: (a) their use by educational establishments for educational purposes; (b) the caching of data by online service providers (\u201cOSP\u201d); (c) the copying of sound recordings from one media format to another for private and domestic use; and (d) fair dealing for the purposes of criticism, review, performance, quotation, parody, satire, caricature, pastiche, reporting and commenting on current events, in certain circumstances.<\/li>\n
      4. Providing safe harbour provisions to OSPs<\/em>. OSPs will escape liability for infringements which take place on their platforms, provided they (i) take reasonable steps to limit or stop the infringement as soon as practicable after becoming aware of the infringement; (ii) have not received any financial benefit from the infringement and (iii) do not interfere with measures taken by the copyright owners to identify or protect the copyright works. OSPs are deemed to have taken reasonable steps to stop or limit an infringement of copyright if they comply with the Code of Practice for OSPs published by the Secretary for Commerce and Economic Development.<\/li>\n
      5. Adding factors to consider when determining damages for infringement<\/em>. In addition to factors such as the flagrancy of the infringement, courts may now take into account the following two new factors when determining the amount of additional damages for infringements: (a) the unreasonable conduct of the infringer after the infringement occurred; and (b) the likelihood that the infringing copies will be circulated widely as a result of the infringement.<\/li>\n<\/ol>\n

        Conclusion<\/p>\n

        While the Amendment is certainly a milestone in the updating of Hong Kong\u2019s copyright regime, it is only a start. The Hong Kong government has announced that it will start a new round of review to deal with issues which have not been reflected in the Amendment, for instance in relation to data mining and artificial intelligence.<\/span>\u00a0<\/span><\/p>\n

        Camilla Venanzi<\/a> | Erik Leyssens<\/a> | Nicolas Vanderchmitt <\/a><\/span><\/span>\u00a0<\/span><\/a><\/p>\n

         <\/p>\n

        <\/a>\"\"<\/p>\n

        <\/a>Retirement Policy for Foreigners in China\u00a0<\/strong><\/p>\n

        Does China\u2019s statutory retirement age apply to foreigners working in China?<\/p>\n

        While mass protests continue to roil French cities to oppose a new policy that raises the retirement age from 62 to 64 and requires workers to contribute to the pension system for longer, the Chinese government will roll out a new policy to defer retirement age progressively. In China, the current statutory retirement age is 60 for male employees, 50 for ordinary female workers and 55 for female officers. The deferred retirement age under the new policy would be up to 65 years for all Chinese employees.<\/span>\u00a0<\/span><\/p>\n

        Employment contracts in China will automatically terminate upon the employee reaching the statutory retirement age. However, this begs t<\/span>he question: does the deferred retirement age apply to foreigners working in China?\u00a0<\/span>\u00a0<\/span><\/p>\n

        Chinese law at the national level only sets the minimum employment age for foreigners, but it lacks explicit provisions of retirement age for foreigners. Each region has different views and judicial practices. In Shanghai, employment contracts with foreigners over China\u2019s statutory retirement age are still valid, provided that the employer obtains the proper working permit for such foreigners. Beijing authorities hold the opposite view and advise that China’s statutory retirement age also applies to foreigners.\u00a0<\/span>\u00a0<\/span><\/p>\n

        In consideration of the different practices in China, employers must be cautious and take proper measures before executing the employment contracts with foreign workers, such as drafting specific clauses to take into account the situation of foreigners being expatriates or seconded in Mainland China. Even though the laws are supposed to be applied no matter the nationality of the concerned employee, there are specific exceptions. And legal loopholes are to be filled only contractually between the employer and the employee to avoid potential litigations.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

        Helen Liu<\/a>\u00a0| Fanny Nguyen <\/a><\/span><\/span>\u00a0<\/span><\/a><\/p>\n

         <\/p>\n

        <\/a>Significant Increase of trademark rejections in China!\u00a0\u00a0<\/strong><\/p>\n

        Chinese Trademark Office has strengthened its translation skills.\u00a0<\/span><\/p>\n

        Until recently, the Chinese Trademark Office was approving trademarks in foreign languages with usual international conditions, being legal, distinctive, original, and available for registration.\u00a0<\/span>\u00a0<\/span><\/p>\n

        However, since the amendment of the Trademark Law of People’s Republic of China (PRC) and the improvement of the translation software used by the Chinese Trademark Office, we have noticed a significant trend to reject the application of foreign trademarks.<\/span>\u00a0<\/span><\/p>\n

        Do remember that the Chinese Trademark Office is the one receiving the most applications from everywhere in the world. This means that potentially a trademark similar to yours (when not identical) is already registered. If, on top of that, you add the fact that the Chinese Trademark Office considers whether your trademark has a similar meaning than a registered Chinese trademark, the risk to be rejected is higher.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

        Now, the Chinese meaning check covers almost all the common languages including those used to be unfamiliar to the Chinese authorities.<\/span>\u00a0<\/span><\/p>\n

        Even though it was already stipulated in Trademark Law of PRC (amended in 2019), <\/span>1<\/sup><\/span>the exam of the meaning in Chinese of the foreign trademark was not exhaustive in the past due to language barriers, but now, the rejections are becoming frequent.<\/span>\u00a0<\/span><\/p>\n

        More than ever, there is a need to register your trademark before entering the Chinese market and to ensure of its registration in advance.\u00a0<\/span>\u00a0<\/span><\/p>\n

        Estelle Chen<\/a> | Fanny Nguyen <\/a><\/span><\/span>\u00a0<\/span><\/a><\/span><\/span><\/span><\/p>\n

         <\/p>\n

        <\/a>\"\"<\/p>\n

        <\/a>Recent employment law updates<\/strong>\u00a0<\/span><\/p>\n

        Overseas Networks and Expertise (ONE) Pass\u00a0<\/span><\/p>\n

        The Overseas Networks & Expertise Pass is a personalised pass for top talent across all sectors. Since January 1st, 2023, it allows eligible applicants to concurrently start, operate and work for multiple companies in Singapore. Candidates who meet the salary criterion (i.e. earn or will earn a monthly salary of $30.000) or have outstanding achievements can apply. The duration of the pass for both first-time candidates and all subsequent renewals is 5 years. For more details, please refer to the Ministry of Manpower (\u201cMOM\u201d) website.<\/a><\/span><\/p>\n

        Introduction of Manpower for Strategic Economic Priorities Scheme\u00a0<\/span><\/p>\n

        The Manpower for Strategic Economic Priorities Scheme (\u201cM-SEP Scheme\u201d) supports the growth of Singapore-based companies. Since December 13th, 2022, the M-SEP Scheme gives firms some flexibility to temporarily hire S Pass and Work Permit holders above their existing Dependency Ratio Ceiling (\u201cDRC\u201d) and S Pass sub-DRC for 2 years. Eligible firms can obtain additional S Pass and Work Permit quota up to 5% of their base workforce headcount, subject to a cap of 50 workers per firm and fulfilment of the commitments listed on the MOM website.<\/a><\/span><\/p>\n

        Graciane<\/span> Pa\u00eftard<\/span> \u2013 Albin<\/span>\u00a0<\/span><\/a>| Astrid Cippe<\/a><\/span><\/span>\u00a0<\/span><\/a><\/p>\n

         <\/p>\n

        <\/a>Multijurisdictional Cash-pooling agreement \u2013 do handle with care!<\/strong>\u00a0<\/span><\/strong><\/p>\n

        Cash pooling allows a group of companies to centralise the management of funds in the hands of one designated entity, the \u201cpool leader\u201d. Two main types of pooling arrangements exist: (1) Notional Cash Pool where the cash is not physically transferred to the bank account of the pool leader; and (2) Physical Cash Pool where the cash is effectively transferred from the account of each pool member into the account of the pool leader on a periodic basis. In the case of (2), the pool leader technically becomes the owner of the cash, and the arrangement then has to provide terms and conditions for deposits made in the pool and drawdowns (loans) by the group members from the pool.\u00a0\u00a0<\/span><\/p>\n

        There are various reasons for a group to implement a cash pooling, such as minimizing the cost of funding (allowing subsidiaries to use internal available funds instead of applying for bank borrowing), monitoring the cash position of the group, as well as managing possible foreign exchange exposures, and maximizing the group’s return by negotiating better terms with third party banks.<\/span>\u00a0<\/span><\/p>\n

        However, it becomes obvious that these kinds of agreements do involve various pitfalls:<\/span>\u00a0<\/span><\/p>\n