China Updates- Inbound Investment

Inbound Investment

The Ministry of Commerce (MOFCOM) has issued a draft of a new Foreign Investment Law for public comment. The proposed changes to the current foreign investment regime are far-reaching, and – for example – would replace and consolidate the existing laws on foreign inbound investment, namely the Sino-foreign Equity Joint Venture Law, the Wholly Foreign-owned Enterprise Law and the Sino-foreign Contractual Joint Venture Law. As with recent tax reforms, this will result in more equal treatment between foreign and domestic companies.

Hong Kong Updates- Employees Compensation

Increases to reflect inflation in the statutory compensation levels under employees compensation legislation have been approved and will take effect for work accidents happening after 4th March, 2015.

The increases include (i) the ceiling of monthly earnings up from HK$23,580 to HK$26,070. This figure is the basis for calculating the maximum amounts of compensation for permanent total incapacity and for death; (ii) the minimum levels of compensation for death up from HK$340,040 to HK$375,950; (iii)the minimum levels of compensation for permanent total incapacity up from HK$386,110 to HK$426,880; (iv)the maximum amount of compensation for employees requiring attention by another person up from HK$462,890 to HK$511,770; and (v) the maximum amount of funeral expenses up from HK$70,000 to HK$76,220.

***
Primasia will post the updates of Hong Kong and China from time to time. Follow us on our Website/ Blogger/ LinkedIn and stay tunned for our updates!

===================================================================

Need more information?
Please contact:
John Barclay -Email
Teresa Tam - Email 
--------------------------
Follow us on:
Website: Primasia HK / Primasia China
LinkedIn: Primasia
--------------------------
Primasia Corporate Services Limited
Tel: +852 2882 2088
Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wanchai, Hong Kong

Hong Kong Updates- Data Privacy

Data Privacy

The Privacy Commissioner has (in December 2014) issued guidelines on the cross border transfer (i.e. out of Hong Kong) of personal data, in anticipation of the enactment of s.33 of the Personal Data (Privacy) Ordinance. The section has been on the statute books since 1996. Very broadly, in order not to commit an offence under s.33, the data user will have to be transferring the data to a country on a “white list”, have reasonable grounds to believe that the data will be protected by similar laws to Hong Kong’s, have the subject’s consent, or be handling data which are otherwise exempt.

***
Primasia will post the updates of Hong Kong and China from time to time. Follow us on our Website/ Blogger/ LinkedIn and stay tunned for our updates!

===================================================================

Need more information?
Please contact:
John Barclay -Email
Teresa Tam - Email 
--------------------------
Follow us on:
Website: Primasia HK / Primasia China
LinkedIn: Primasia
--------------------------
Primasia Corporate Services Limited
Tel: +852 2882 2088
Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wanchai, Hong Kong

Hong Kong Updates- Minimum Wage & MPF

Minimum Wage

The annual adjustment to the Statutory Minimum Wage ("SMW") rate was gazetted. The rate will increase from HK$30 to HK$32.5 per hour and will come into effect on 1st May 2015.

The monthly cap (the limit above which it is not necessary to keep a written record of hours worked) will increase from HK$12,300 to HK$13,300 per month.

China Updates- Taxation

Taxation

New General Anti-Avoidance Rules (GAAR) were issued. The new rules, which come into effect on 1^st February, 2015, apply only to cross-border arrangements. It is specified that:

1. GAAR should only be used once SAAR (Specific Anti-Avoidance Rules) and tax treaty provisions are exhausted.  SAT approval is required.

2. GAAR will be invoked where either the sole or main purpose of an arrangement is to obtain a tax benefit or the tax benefit is obtained by using an arrangement whose form is permitted under tax rules, but is not consistent with the economic substance of the arrangement.

3. Once GAAR are invoked, tax authorities may adjust the result of the arrangement such that it is in conformity with the deemed reality of the underlying commercial situation.

4. The onus of proof under a GAAR investigation rests with the party being investigated. 

***
Primasia will post the updates of Hong Kong and China from time to time. Follow us on our Website/ Blogger/ LinkedIn and stay tunned for our updates!

===================================================================

Need more information?

Please contact:

John Barclay -Email

Teresa Tam - Email 

--------------------------

Follow us on:

Website: Primasia HK / Primasia China

LinkedIn: Primasia

--------------------------

Primasia Corporate Services Limited

Tel: +852 2882 2088

Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wanchai, Hong Kong

China Updates- FDI Catalogue Update

FDI Catalogue Update

The consultation period for the revised draft of the Foreign Investment Industrial Guidance Catalogue (“FDI Catalogue”) ended on 3rd December. This Consultation Draft makes significant changes, including the following:

1. Removal of Foreign Ownership Restrictions in around 75% of industries subject to a requirement to forming joint ventures with Chinese parties and around 25%  of industries where a Chinese party must (previously) have held a majority stake . 
2. Reduction of Restricted List by around 50%. Examples of industries thereby freed up include direct marketing and e-commerce.
3. Increase of Encouraged List, mainly in manufacturing subsectors and clean and alternative energy, but also in transportation, environmental protection, and various design sectors.

***
Primasia will post the updates of Hong Kong and China from time to time. Follow us on our Website/ Blogger/ LinkedIn and stay tunned for our updates!

===================================================================

Need more information?
Please contact:
John Barclay -Email
Teresa Tam - Email 
--------------------------
Follow us on:
Website: Primasia HK / Primasia China
LinkedIn: Primasia
--------------------------
Primasia Corporate Services Limited
Tel: +852 2882 2088
Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wanchai, Hong Kong

Hong Kong Updates- Paternity Leave & Data Protection

Paternity Leave

On 24th December, the  was amended to introduce three days’ paid paternity leave for working fathers (and fathers-to-be). This will come into effect on 27 February 2015.

Data Protection

The first prison sentence (but only of 4 weeks) imposed under the Personal Data (Privacy) Ordinance (of 1996) was handed down on 4^th December.

***
Primasia will post the updates of Hong Kong and China from time to time. Follow us on our Website/ Blogger/ LinkedIn and stay tunned for our updates!

===================================================================

Need more information?
Please contact:
John Barclay -Email
Teresa Tam - Email 
--------------------------
Follow us on:
Website: Primasia HK / Primasia China
LinkedIn: Primasia
--------------------------
Primasia Corporate Services Limited
Tel: +852 2882 2088
Suite 1106-08, 11/F., Tai Yau Building, No. 181 Johnston Road, Wanchai, Hong Kong