Archive for category: Member News

The Hong Kong government, via its Financial Services and the Treasury Bureau, has consulted on a proposed regime for non-Hong Kong incorporated companies to re-domicile in Hong Kong. The objective is to facilitate company re-domiciliation to Hong Kong, thus strengthening Hong Kong’s status as an international finance and business hub. The legislation of the new regime is expected to take place from 2023 to 2024.

KEY BENEFITS

Unlike other jurisdictions like Singapore, Canada and New Zealand, Hong Kong currently does not allow re-domiciliation.

If a foreign company wishes to move its identity and business to Hong Kong, a new Hong Kong company must be set up to take over its business. This process is cumbersome and can result in substantial taxes and/or costs as well as disruption to operations and corporate history.

The government’s proposal would now allow non-Hong Kong companies to change their place of incorporation to Hong Kong while preserving their legal status as body corporates, their properties, rights, obligations, liabilities and contracts. This proposal would offer companies maximum business continuity while reducing administrative complexity and costs in the process.

ELIGIBILITY

The proposed regime imposes no economic substance test of thresholds of assets, revenue or employee numbers. The Registrar of Companies will be empowered to consider and approve applications based on factors that include:

• Whether the type of Hong Kong company (private company limited by shares, public company limited by shares, company limited by guarantee, private unlimited company with a share capital, or a public unlimited company with a share capital) is the same or substantially the same as the applicant’s type of company in its original place of incorporation.
• Whether the applicant has complied with the legal requirements of its jurisdiction of incorporation for the transfer of incorporation in Hong Kong.
• Whether (at the application date) the applicant’s first financial year end has passed in its place of incorporation.
• Whether the applicant will comply with the naming requirements for the incorporation of a Hong Kong company under the Hong Kong Companies Ordinance.
• That the applicant will not be used for an unlawful purpose, contrary to public interest or endangering national security.
• That the re-domiciliation application is made in good faith and not intended to defraud existing creditors of the applicant.
• Whether a resolution for the transfer of incorporation has been approved by at least 75% of the votes cast by entitled members at a meeting of which members were given at least 21 days’ notice, if the applicant’s original place of incorporation does not include members’ consent to the transfer.
• Whether the applicant can pay its debts as they fall due in the 12 months after the application date.
• That the applicant is not in liquidation or being wound up, and no proceeding for liquidation or winding up against the applicant is ongoing or pending.
• No receiver, or receiver and manager, is in possession of or has control over any property of the applicant, and no relevant proceeding is ongoing or pending.
• No compromise or arrangement made between the applicant and any entity/person is being administered and no relevant proceeding is ongoing or pending.

EFFECTS

Once re-domiciled, the company will have the same rights and obligations as other Hong Kong incorporated companies of its type, and will need to comply with the Companies Ordinance. Its corporation information will be available for public inspection. If the company needs a particular licence to conduct its businesses in Hong Kong, it will need to separately apply for the licence.

Applicant companies that were registered with the Companies Registry of Hong Kong as non-Hong Kong companies will cease to be so when they are granted their certificate of re-domiciliation.

TIMELINES

It is proposed companies must provide the Registrar of Companies with evidence of their de-registration in their original place of incorporation within 60 days of their re-domiciliation to Hong Kong. Failure to do so will result in the revocation of the application and the termination of the re-domiciliation.

However, market practitioners consider that 60 days will be too short. The de-registration process in the original jurisdictions may involve public notices and/or court procedures (for protection of members and creditors) as well as tax clearance, and may take much longer than 60 days.

It is also hoped that the regime will, instead of terminating the re-domiciliation right after the expiry of the required de-registration period, provide flexibility for the Registrar of Companies to extend this de-registration period if justifiable grounds are given.

The de-registration process in the original jurisdictions may be beyond the applicants’ control. Also, some applicants may need to open bank accounts in Hong Kong before they may start de-registration in their original jurisdictions.

KEY TAKEAWAY

Industries have reflected that non-Hong Kong incorporated companies, especially enterprises with business operations in Hong Kong and those hoping to leverage on Hong Kong’s geographic and economic advantage to expand their business are interested in re-domiciling to Hong Kong. As a response to such market demands, a company re-domiciliation regime with a straightforward application process is a welcome initiative.

By Rossana Chu, Jacky Chan

Note: This material has been prepared for general information purposes only and is not intended to be relied upon as professional advice for any cases. Should you need further information or legal advice, please contact us.

The UAE is set to undergo a substantial transformation in handling end-of-service gratuity for employees in the private sector where employers will soon have the option to select from several schemes for their employees.

The existing end-of-service gratuity system in the UAE involves employers providing employees with a lump-sum payment at the end of their employment relationship calculated based on the employee’s last basic salary. Employees will only be eligible for this end-of-service gratuity payout if they have been employed for more than a year. The current market practice and system is for the employers to set aside this monthly accruing amount on behalf of the employee with no opportunity to accrue earnings during that time.

Recently, the UAE Cabinet approved a plan to introduce an alternative end-of-service gratuity system for private sector employees and free zone workers within the UAE. This innovative and voluntary initiative involves the establishment of private-sector investment and savings funds overseen by the Securities and Commodities Authority in collaboration with the Ministry of Human Resources and Emiratisation. Under this scheme, employers can choose to invest and save their employees’ end-of-service gratuities through these funds, offering a range of investment options.

Under this new proposed scheme, participating employers will make monthly contributions on behalf of their employees to the selected investment funds and upon termination of the employment relationship, the employee will receive their end-of-service gratuity along with any accrued returns from the funds directly.

Employers can choose to enroll their workers, regardless of their professional levels, in the new scheme and pay a monthly contribution. Currently, there are three investment options:

• Risk-free capital guarantee;
• Investments, where risks vary between low, medium, and high; or
• Sharia-compliant investments.

Details regarding the implementation timeline and how existing end-of-service gratuity accruals will be handled are yet to be provided and clarified.

The UAE is progressing toward a more advanced landscape for both employees and employers demonstrating a giant positive leap. The concept of establishing a countrywide saving scheme open to all employees in the private sector is groundbreaking in the region.

HOW CAN WE HELP?

Hamdan Al Shamsi Lawyers and Legal Consultants are perfectly positioned to assist our clients in respect of all Labour Law related matters.

In HAS Law Firm, we represent the very essence of excellence and expertise in the practice of Employment Law. Our team is dedicated to the desires of our clients while simultaneously managing their expectations alongside the realities of the laws that govern family law.

Our firm has three divisions including (1) the DIFC team; (2) the UAE Litigation team; and (3) the Corporate team, and currently deal with a network of other law firms around the world including the USA, UK, France, Italy, Germany, Saudi Arabi, Oman, Kuwait, Bahrain, Jordan, Lebanon, China and Australia.

Our specialized lawyers in Labour Law will be able to further assist and answer any questions you may have.

Ahmad Al Khalil | Partner

Hamdan Al Shamsi Lawyers & Legal Consultants

For any enquiry please click here

Leaders in Law, the leading platform in its field, is delighted to welcome Michalis Anastasiou as our exclusively recommended & endorsed Company Law expert in Cyprus.

Michalis Anastasiou graduated from the Law School of the University of Sussex in Brighton, UK in 2012. He was called to the English Bar at Gray’s Inn in 2013. He obtained in 2014 his LLM on International Business Law at BPP Law School in London, UK.

He was admitted in the Cyprus Bar Association in 2015. Michalis speaks fluently Greek and English.

Michali’s specialises in business and corporate law, company registration and administration, investment firms and forex brokers cases, forex scam litigation, civil and criminal litigation, personal injury and insurance cases. He appears before the Courts of Cyprus, and he is involved with judicial matters and the drafting of legal documents.

Practice Areas

• Business and Corporate Law
• Immigration Law
• Litigation
• Contract Law
• Personal Injury
• Criminal Law

Education & Bar Admissions

• University of Sussex; 2012. Brighton, UK
• The University of Law, 2013. London, UK
• Admitted to the English Bar at Gray’s Inn, 2013
• BPP Law School, 2014. London, UK
• Admitted to the Cyprus Bar Association, 2015

Leaders in Law, the leading platform in its field, is delighted to welcome Salvatore R. LaScala as our exclusively recommended & endorsed Anti-Money Laundering expert in the USA – New York.

Salvatore R. LaScala is a partner and co-lead of Guidehouse’s Global Investigations and Compliance practice.

Possessing a broad range of subject matter knowledge and expertise, Salvatore applies his 20+ years of hands-on experience to conduct investigations and compliance reviews on behalf of financial institution clients responding to regulatory or law enforcement matters concerning anti-money laundering (AML), Bank Secrecy Act (BSA), USA PATRIOT Act and Office of Foreign Assets Control (OFAC).

Salvatore leads large teams that regularly perform historical transaction reviews (“Lookbacks”) and Know Your Customer (KYC) / Customer Due Diligence (CDD) / Enhanced Due Diligence (EDD) file remediation work. He also helps clients overcome AML and OFAC backlogs by deploying teams embedded at his clients’ work sites to that disposition alerts. Salvatore’s expertise also includes assisting clients with the selection, implementation, optimization and validation AML and OFAC compliance technology consulting and enhancing AML transaction monitoring detection scenarios and sanctions filter interdiction logic.

Firm Description:

Guidehouse is a leading global provider of consulting services to the public sector and commercial markets, with broad capabilities in management, technology, and risk consulting. By combining our public and private sector expertise, we help clients address their most complex challenges and navigate significant regulatory pressures focusing on transformational change, business resiliency, and technology-driven innovation. Across a range of advisory, consulting, outsourcing, and digital services, we create scalable, innovative solutions that help our clients outwit complexity and position them for future growth and success.

The company has more than 16,500 professionals in over 55 locations globally. Guidehouse is a Veritas Capital portfolio company, led by seasoned professionals with proven and diverse expertise in traditional and emerging technologies, markets, and agenda-setting issues driving national and global economies.

 

Leaders in Law, the leading platform in its field, is delighted to continue Neil McLarnon as our exclusively recommended & endorsed Commercial Litigation Law expert in the Cayman Islands.

Neil McLarnon joins us having spent 12 years practising as a Barrister in London’s leading offshore commercial chancery Chambers. Before that Neil spent 2 years in the London litigation department of Weil, Gotshal & Manges. Neil has specialised in complex international commercial litigation and arbitration involving disputes up to the value of US$50 billion.

As sole Counsel, Neil McLarnon has represented clients at every level of the English civil law court structure, from tribunals and county courts, through the High Court, the Court of Appeal to the UK Supreme Court. He has represented clients in ICC, LCIA, DIAC and ad hocarbitrations. He also regularly appeared before the Dubai International Financial Centre Court. As Junior Counsel, he has worked alongside Senior Counsel for hearings and trials taking place before the High Court and the Courts of the Bahamas, the British Virgin Islands, the Cayman Islands, Guernsey and Jersey.

Firm Description:

Travers Thorp Alberga is a boutique Cayman Islands and British Virgin Islands law firm comprised only of the most experienced lawyers from both jurisdictions and modelled for the post financial crisis environment. We specialize in highly technical structuring involving complex securities and regulatory issues. Our partners provide incisive and highly effective advice to a higher standard on all types of offshore entities including hedge funds, private equity, corporate and partnership vehicles, asset and structured finances, cryptocurrencies and ICO’s, capital markets, general corporate and commercial matters, and private client. We advise from our offices in Grand Cayman, the British Virgin Islands, Hong Kong and Australia. The firm also has a highly experienced four-partner litigation team specializing in all forms of complex cross border dispute resolution and insolvency.