APAC Monthly Legal Developments on Private Wealth – July 2021

Welcome to Herbert Smith Freehills monthly updates on the Asian Wealth Management Industry.

Each month, we survey ten Asian jurisdictions on legal developments regarding trust and estate planning of interest to the private wealth industry, and provide a succinct summary in tabular form. The jurisdictions covered by the update are Hong Kong, Singapore, China, Taiwan, Japan, India, Malaysia, Indonesia, Thailand and the Philippines. We hope these updates prove to be a useful resource in keeping private clients, business people and lawyers up to date with legal updates in the region.

Hong Kong

The company register will remain searchable by bankers, accountants and lawyers

Plans have been announced in Hong Kong to conceal the residential address and ID document numbers of corporate directors from the corporate register from the public. Hong Kong’s Secretary for Financial Services and Treasury said that after these plans are implemented, certain specified individuals (which include bankers, accountants and lawyers) may request access to the full details of these directors of ‘business if these specified people do “relevant checks and work” – an example given by the secretary includes bankers, accountants and lawyers who perform know-your-customer checks.

Singapore

MAS publishes compliance toolkit for fund managers

The Monetary Authority of Singapore (MAS) has issued guidance in the form of a ‘Compliance Toolkit’ which aims to guide and facilitate the compliance of licensed fund management companies, registered fund management companies and venture capital fund managers to various approvals, notifications and reporting requirements and deadlines.

Remarks by the Managing Director of MAS on Decentralized Finance and the Future of Money

The MAS published the remarks of its director general, Ravi Menon, at a recent conference. Menon spoke about the decentralization of finance through the three ‘I’s of the money stack – intermediaries, infrastructure and instruments, and how central banks and regulators can potentially shape this decentralization in a way that respects the rules. critical values ​​of money.

LRC recommends allowing the creation and operation of statutory trusts for non-charitable purposes in Singapore

The Singapore Law Academy’s Law Reform Committee (LRC) has released a report that recommends the establishment and operation of non-charitable trusts (NCPTs) in Singapore. The LRC has indicated that recent surveys of trust and estate practitioners have demonstrated a clear demand for additional means for families and businesses to manage and bequeath their assets, and that there is evidence of a demand. growing social enterprises for new capital.

China

Cancellation of preferential personal income tax policies for foreigners working in China in 2022

It is expected that from January 1, 2022, the preferential personal income tax policies for foreigners working in China will be canceled. For example, there will no longer be an individual income tax exemption from housing allowances granted to foreigners working in China by their employers.

Japan

Legal reforms to remove obstacles preventing Japanese asset management companies from appointing foreign fund managers implemented

Legal reforms have been implemented in Japan with the aim of removing obstacles for Japanese asset management companies to appoint foreign fund managers. These reforms include, but are not limited to, making the performance-based compensation paid by an asset management company to executives deductible from corporation tax under certain conditions, and exempting certain foreign nationals. residing in Japan for business purposes inheritance tax on their foreign assets.

India

RBI issues guidelines on dividend declaration by NBFCs

The Reserve Bank of India (RBI) has issued guidelines on the distribution of dividends by non-bank financial corporations (NBFCs). The guidelines cover board oversight, eligibility criteria, amount of dividends payable and reporting. The guidelines apply to the declaration of dividends from profits as of the fiscal year ended March 31, 2022.

SEBI consults on the monitoring framework for voting rights shares

The Securities and Exchange Board of India (SEBI) has released a consultation paper reviewing certain provisions related to the voting rights oversight framework, including with respect to shareholder net worth requirements. Comments are requested by July 30, 2021.

Malaysia

SCM amends capital markets laws

The Securities Commission Malaysia (SCM) announced several changes to the 2007 Capital Markets and Services Act (CMSA), which came into effect on July 1, 2021.

The changes, brought about by changes to CMSA Annexes 6 and 7, have broadened the categories of sophisticated investors.

In addition, the changes to Annexes 6 and 7 will allow Bursa Malaysia to undertake the registration of ACE market prospectuses as of January 1, 2022.

CMSA Annex 5, which defines the type of business proposals that do not require SC approval, has also been amended to include the following:

  • initial digital asset exchange offer through a recognized market operator; and
  • an initial public offering (IPO) or cross-listing of the shares of a public company or a company listed on a stock exchange outside Malaysia.

SCM publishes guidelines on sustainable and responsible investment funds

The SCM has published guidelines on sustainable and responsible investment (SRI) funds.

The guidelines set out additional requirements to be met by any new or existing fund seeking to qualify as an SRI fund. They are inspired by and adopt international best practices and do not aim to define or create a standard on sustainable and responsible investment products. However, management companies and fund managers are encouraged to keep abreast of global developments and adopt international best practices to meet clients’ expectations for sustainability.

SCM issues guidelines on share offerings by unlisted public companies to sophisticated investors

The SCM has issued guidelines on the offering of shares by unlisted public companies (UPCs) to sophisticated investors.

The new guidelines aim to ensure that controls are in place to ensure that any offering, including any marketing or distribution of its shares by a UPC to sophisticated investors, is carried out in accordance with regulatory requirements. The directives also impose notification and reporting obligations on the UPC for such offers.

Indonesia

Bank Indonesia issues new regulations on oversight of foreign exchange transactions

Bank of Indonesia has issued Bank of Indonesia Regulation No. 23/5 / PBI / 2021 and Governing Council Regulation No. 23/11 / PADG / 2021 on Foreign Exchange Transactions Supervision System ( FX) vs. IDR. Under these regulations, Indonesian banks are required to connect their foreign exchange transaction system to Bank Indonesia’s foreign exchange transaction monitoring system called SISMONTAVAR system, which monitors foreign exchange transactions in real time.

Foreign exchange transactions against IDR which must be declared via SISMONTAVAR are:

  • spot transactions (including tod and tom transactions) with a minimum value of $ 250,000 or its equivalent; and or
  • derivative transactions with a minimum value of 1,000,000 USD or its equivalent.

The regulation entered into force on June 2, 2021 and July 2, 2021 respectively.

Thailand

SECT consults on the qualifications of the settlor and trustees and on the conduct and duty of the trustees

The Securities and Exchange Commission, Thailand (SECT) is consulting on proposed changes to regulations relating to the qualifications of settlor and trustees and the conduct and duty of trustees. SECT said the consultation aims to facilitate greater use of trust for transactions in Thai capital markets, which will ultimately lead to a wider range of fundraising tools for businesses and more. of investment asset classes for investors. Comments are requested by July 30, 2021.

The content of this document is for reference purposes only. Some information comes from public sources and may not be complete, accurate or up to date; where we have relied on third party information and sources, this has not been verified by us. The document does not constitute legal advice and should not be relied on as such. Specific legal advice on your particular situation should always be sought separately before taking any action based on this publication, and all the facts in this document should be checked for your specific situation at the time you wish to use or refer to them.


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