Latest Magazine Articles

The Benefits of Holding Companies for FDI

Hong Kong and Singapore are seen as jurisdictions of choice for regional headquarters, branch offices and holding companies. In this issue, we focus on the benefits that these two jurisdictions offer for the last of these options: a holding company structure (or “special purpose vehicle”), a corporate setup in which a holding company is inserted between a parent company and its subsidiary.

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Establishing and Maintaining Hong Kong Companies

Hong Kong company setup is governed by the Hong Kong Companies Ordinance, with the Companies Registry overseeing the incorporation process. Following the implementation of the “One-stop Company and Business Registration Service” in early 2011, company set up in Hong Kong got even easier, with application for incorporation of a local company acting as a simultaneous application for business registration.

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Establishing and Maintaining Singapore Companies

Similar to Hong Kong, most Singapore companies are registered as private limited liability companies. Key points of Singapore company setup include the requirement that the company secretary and at least one director are Singapore residents and the approvals required according to their Accounting & Corporate Regulatory Authority (ACRA) Singapore Industry Classification Code (“SSIC Code”).

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A Look at Double Tax Agreements

While Hong Kong has been on a DTA signing spree in the past two years, Singapore is the Asian queen of double taxation agreements (DTAs), boasting 69 comprehensive DTAs, roughly triple that of Hong Kong. To date, there are approximately 3,000 DTAs across the globe, with 100 added each year.

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China Regulatory Updates

China Clarifies Filing Process for Foreign-Funded Venture Capital Enterprises

In order to improve the management of foreign-funded venture capital enterprises, China’s Ministry of Commerce (MOFCOM) issued a circular on May 7 clarifying the filing procedures for foreign-funded venture capital enterprises.

Severance Pay Subject to Individual Income Tax in China

Officials from China’s State Administration of Taxation answered questions on several hot issues regarding ambiguities in tax payments, clarifying that individual income tax should be paid when an individual receives compensation for termination of their contract.

China Orders 'Big Four' Auditors to Restructure

China now requires the “Big Four” auditing companies of Deloitte Touche Tohmatsu, Ernst & Young, KPMG and PricewaterhouseCoopers to “localize” their staff in line with Chinese laws that specify the qualifications, age and experience of their management.

China Announces VAT Pilot Project for Agricultural Products

Starting from July 1, 2012, VAT general taxpayers who purchase agricultural products as raw materials for the production and sales of liquid milk and dairy products, liquor and ethyl alcohol, or vegetable oil, will be able to deduct input VAT.

China Issues New Guidelines to Help Minimize Tax Uncertainty

Recent guidelines release by China's SAT set out a working guidance to standardize the internal procedures for the Chinese tax authorities to provide replies on specific tax matters.