Author Archives: VTCo

HKMA on Green Finance and UNPRI

Posted on by

Earlier this week, the Hong Kong Monetary Authority (HKMA) issued a press release on key measures that the HKMA is adopting to support and promote sustainable and green finance in Hong Kong (https://www.hkma.gov.hk/eng/key-information/press-releases/2019/20190507-4.shtml)

In particular, as an asset owner and manager of the Exchange Fund, HKMA is placing emphasis on responsible investment, including incorporating ESG factors in HKMA’s credit risk analysis on bonds and to further grow the Exchange Fund’s green bond portfolio, through direct investment or investment in green bond funds. 

HKMA is also requiring external managers of the Hong Kong equity portfolios to comply with the Principles of Responsible Ownership promulgated by the Securities and Futures Commission in 2016, and intends to participate in ESG-themed public equities investments through external managers in passive or active mandates targeting ESG benchmark index.

According to recent news, HKMA may soon be the second central bank to sign up to the Principles for Responsible Investment (UNPRI) (the first being Dutch central bank).

Offshore Economic Substance Requirements

Posted on by

From 1 January 2019, various offshore jurisdictions have enacted economic substance (ES) requirements, although there are differences and local nuances in each of the respective jurisdictions involved. Generally speaking, the introduction of ES requirements in such traditional ‘no or nominal tax jurisdictions’ has raised concerns amongst individuals or corporations who have been using offshore companies, whether in the conduct of a trade or business, funds or investment management, family-owned businesses or trust structures using offshore companies for the holding of investments or real properties, multinational groups with an offshore listing vehicle and/or holding companies, and so forth. As such, the impact of the ES requirements on the use of entities in such no or nominal tax jurisdictions needs to be assessed, immediately and on an ongoing basis.

In this legal update we provide an outline of the broad global context and the general ES requirements for information and discussion, while specific details of the ES requirements that may apply to specific entities in specific offshore jurisdictions should be considered in consultation together with lawyers of the particular jurisdictions in question.

Specifically, we consider the types of entities and activities that may be impacted, the potential implications and options that may be available to comply or address the ES requirements, including whether companies may “relocate” or obtain tax residency in another jurisdiction such as Hong Kong, which we suggest careful analysis should be undertaken in review.

Offshore Economic Substance RequirementsDownload

To view a Chinese version of this update:

Offshore-Economic-Substance-Requirements-ChiDownload

“Green” or “ESG” Funds? Hong Kong Regulator Issues Guidelines

Posted on by

An evolutionary force has built momentum in recent years within the global investment management industry and investors community – a greater focus on the power of capital for good and purpose. Beyond “green investing” to fight climate change, it goes from sustainable investing to ethical or impact investing, encompassing objectives to embrace broader responsibilities that take into account environmental, social and corporate governance (ESG) factors.

In the broader context, the investment industry and capital markets are responding to governmental policies and investors demand for capital allocation with these objectives. Yet, there are varying degrees and approaches to addressing ESG factors, with limited regulatory requirements that provide specific framework. What counts as green, or what specific environmental, social or governance issues are being addressed, and how?

With an increase in the offering of investment products or services with proposed green or ESG investment objectives or policies, there is an issue of clarity or sufficiency of disclosures. This makes it difficult for investors to compare and contrast the available choices of products – what exactly are the products purported to be or to what extent are the investment strategies or investment portfolios actually “green” or “ESG” compliant.

On 11 April 2019, the Hong Kong Securities and Futures Commission (“SFC”) issued its Circular to management companies of SFC-authorised unit trusts and mutual funds to address “Green” or “ESG” funds (Circular). The aim is to enhance disclosure comparability between similar types of SFC-authorised Green or ESG funds and their transparency and visibility in order to facilitate investors making informed investment decisions in this evolving investment areas.

The Circular would serve to require and obligate investment managers offering investment products with an expressed green or ESG focus or who intend to do so to carefully consider whether their fund would and is able to comply within the SFC’s expected framework for Green or ESG funds and become designated as such.  An investment manager of Green or ESG funds would also be expected to have a proper and robust investment selection process and assessment criteria in line with its stated investment focus and green or ESG principles, and may seek to obtain a third party certification or fund labeling or would rely on its self-confirmation.

Our legal update outlines the background and context of the growth of Green or ESG funds, Hong Kong’s efforts and SFC’s issued framework for such funds as set out in the new Circular:

Hong Kong Guidelines on Green or ESG FundsDownload

 

家族财富管理

Posted on by

张慧雯律师事务所很高兴成为“中国商法”杂志授予的《2019年中国商法卓越律所大奖》的获奖者。

本所获奖领域为： 家族财富管理 －国际所。

“中国商法”卓越律所大奖是根据中国境内外企业法务、管理决策者、法律专业人士的投票及推荐，以及对获奖事务所的显著成就进行评估而授予的。

由于中国和亚洲地区的财富和超高净值以及高净值家庭的数量大幅增加，近年来对家族财富管理的专业人士和专业服务的需求很大。 不断增长的需求，也带来很多家族办公室的设立。

取决于每个家族的独特情况，家族办公室的功能以及家族办公室的设计、形式和架构可就个别家庭而异。 包括家族企业和投资之需求，为下一代策划资产转移的遗产和传承计划等，可能有很大不同的考虑因素和方式。

在本所获奖之际，我们再次分享本所刊物，含本所深入分析家族财富管理的要素和相关问题。 结合本所就证券及私募股权投资、企业、基金、信托安排和税务等方面的专长，我们期待与更多合作伙伴合作，为行业做出贡献和塑造，以达满足客户需求。

私人财富管理及家族办公室（2019）Download

Family Wealth Management

Posted on by

Vivien Teu & Co LLP is delighted to be a recipient of the China Business Law Awards 2019 conferred by the China Business Law Journal.

The firm is recognised as an award winner in the category of Family Wealth Management – International Law Firm.

The China Business Law Awards of China Business Law Journal are conferred based on votes and recommendations from corporate counsel, senior managers and legal professionals around the world, and an evaluation of the notable achievements of winning firms.

Due to tremendous increase in wealth and numbers of ultra-high-net-worths and high-net-worths families in China and broader Asia, there has in recent years been great demand for professionals and specific expertise in the family wealth management sector to service the growing needs, along with more family offices being established.

The functions of a family office and the design, form and structure for family wealth management can vary significantly from one family to another depending on the unique circumstances of each family. Relevant considerations including succession planning for the family business and investments, leaving a legacy and succession planning for generational transfer of assets can be quite different.

With our award win, we are happy to share again our publication that takes a deep dive into analysing the elements and relevant issues for family wealth management. With our practice focus across securities and private equity investments, corporate, funds, trusts and tax, we look forward to working with more partners in contributing and shaping the sector to meet client needs.

Private Wealth Management & Family OfficesDownload

Revised Code on Unit Trusts and Mutual Funds

Posted on by

On 6 December 2018 the Hong Kong Securities and Futures Commission (“SFC”) issued the consultation conclusions (“the Consultation Conclusions”) on proposed amendments to the Code on Unit Trusts and Mutual Funds, governing investments funds authorised by the SFC for offer to the public in Hong Kong. The revised Code on Unit Trusts and Mutual Funds is now in force with effect from 1 January 2019 with a transition period of 12 months for existing SFC authorised funds and operators.

In this publication, we look into the background of the amendments and the extent of such changes:

Revised Code on Unit Trusts and Mutual Funds (Feb 2019)Download

International tax cooperation spurs key development for the Hong Kong asset management industry

Posted on by

In December 2017, the Council of the European Union (EU) identified certain ring-fencing features in Hong Kong’s profits tax exemption regime, which are considered discriminatory and isolated from the domestic economy. In order not to be labelled as a non-cooperative jurisdiction by the EU Council, Hong Kong committed to addressing this concern by considering appropriate modifications and proposing legislative amendments by the end of 2018.

On 7 December 2018, the Hong Kong Government Gazette published new and self-contained provisions in the Inland Revenue Ordinance (Cap. 112) (IRO) that will allow all funds operating in Hong Kong, regardless of their location of central management and control, their size or the purpose that they serve, to enjoy profits tax exemption for transactions in specified assets subject to meeting certain conditions. The bill will be introduced into the Legislative Council on 12 December 2018, and when adopted, will come into operation on 1 April 2019.

Once the proposed amendments are adopted, more funds are expected to become eligible for enjoying tax exemption benefits in Hong Kong. This is a significant development that will create a level playing field for tax for all funds operating in Hong Kong, whether domiciled in or outside Hong Kong, and whether operating or managed in or from Hong Kong.

The change is expected to enhance Hong Kong’s position as an international asset and wealth management centre, and could attract more professional asset management and related services to be brought into and be carried out from Hong Kong.

Read our Legal Update for more details:

Key development of the asset management industry in HK – level playing field (11 Dec 2018)Download

The International Comparative Legal Guide – Corporate Tax 2019 – Hong Kong

Posted on by

Vivien Teu & Co LLP is delighted to have contributed the Hong Kong chapter of The International Comparative Legal Guide: Vivien Teu & Co LLP_Hong Kong_Corporate Tax 2019.

The Guide is published by Global Legal Group in association with William Watson of Slaughter and May, covering common issues in corporate tax laws and regulations – including capital gain, overseas profits, real estate, anti-avoidance, BEPS and the digital economy – in 34 jurisdictions.

The Full Guide is free to access: https://iclg.com/practice-areas/corporate-tax-laws-and-regulations

以专注理念前进

Posted on by

张慧雯律师事务所谨此通知我们的客户与朋友们，本所与中国内地通力律师事务所的联营关系已于2018年11月终止，我们寻求重新强调以我们的创始理念前行——专注于核心领域的精品律师事务所。本所将会继续加强和建立我们处于领先地位的资产管理和金融服务业务的声誉，其涵盖涉及跨越不同资产类别的投资和融资安排的企业和商业工作，以及私人财富管理和信托安排。

符合本所的在特定领域提供知识和专业服务的策略，我们很高兴国际税务律师严志坚律师加盟本所。作为税务方面的顾问，严律师将和本所合伙人张慧雯律师和高级律师孙凯宁律师一起紧密工作，在本所就资产管理、基金构建、企业服务方面提供税务建议的组成部分服务中扮演关键角色。针对本所向私人客户就私人财产、企业和信托事务提供法律及咨询服务，这也是极为重要的。 在越趋复杂的国际税务问题的大环境下，我们认为税务考虑是必要，特别是我们的工作多属跨境和多司法管辖区性质。

作为一家拥有独特专注领域的独立律师事务所，我们期待与本地和国际客户，以及其他一致希望提供最好法律服务的律师事务所加深合作及发展新机会，以满足我们客户在日趋复杂化的商业、法律和合规环境下所需要的不寻常、专门制订或量身订制的法律方案。

在接下来的数个月里，我们有意邀请更多具有与我们业务和行业焦点相应的专业知识和专长的律师加盟，以应对持续增长的客户要求，其中包括在新兴特定领域例如金融科技、支付服务和虚拟资产、负责任金融及社会企业投资等方面的项目和思想引导倡议。

如果您对本所和我们的服务有兴趣，或有意探索与我们一同工作，欢迎联系我们。我们热衷分享我们的理念和策略，并期待与您取得达共识及建立共同利益。

感谢您们的关注与支持。

Renewed Focus

Posted on by

Vivien Teu & Co LLP would like to inform our clients and friends that we are moving forward with renewed emphasis on our founding philosophy as a boutique law firm focusing on core areas, with the end of our association with Mainland China law firm Llinks Law Offices in November 2018.   Our firm shall continue to strengthen and build on our established reputation as a leading practice in asset management and financial services, covering corporate and commercial work involved in investments and financing arrangements across asset classes, as well as private wealth management and trusts.

In line with the firm’s strategy of offering knowledge and expertise in specific areas, we are delighted that international tax lawyer Kenneth Yim has joined our firm.  As a consultant in tax, Kenneth shall play an important role alongside partner Vivien Teu and senior associate Christina Suen as we spearhead our efforts in offering tax advisory services as an integrated part of our legal services on asset management, funds structuring and formation, corporate and commercial work.  This is also highly relevant for our firm’s legal and advisory services to private clients on their private assets, corporate and trusts matters.  We see taking tax into considerations as key amidst the evolving complexity of international tax issues, especially given the bulk of our work is cross-border and multi-jurisdictional in nature.

As an independent law firm and with our unique focus areas, we are looking forward to deepening collaboration and developing new opportunities working with local and international clients, as well as other law firms with aligned desire of offering best-of-breed legal services, to meet the expanding needs of our clients who require esoteric, customised or bespoke legal solutions in increasingly complex business, legal and regulatory environments.

Over the coming months, we look to bring on board more lawyers with established professional knowledge and expertise within our practice and industry focus, in view of growing client requests, including in projects and thought-leadership initiatives in new specific areas, such as financial technology, payment services and virtual assets, responsible finance and impact investing.

We welcome enquiries if you would like to find out more about our firm and our services as we re-shape in our focus, or if you would like to explore working with us.  We are excited to share our vision and strategy, and look forward to meeting of minds and building on shared interests.

Thank you for your attention and support.