Business law digest

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Business law news

ASEAN

FIVE CENTRAL BANKS INK CROSS-BORDER PAYMENT MOU

Bank Indonesia, Bank Negara Malaysia, Bangko Sentral ng Pilipinas, the Monetary Authority of Singapore and the Bank of Thailand signed a memorandum of understanding (MoU) to collaborate on regional connectivity for cross-border payments during the G20 Leaders’ Summit in Bali. The co-operation will include modalities including QR codes and faster payment. The cross-border payment agreement serves to support and facilitate cross-border trade, investment, financial deepening, remittance, tourism and other economic activities. The payment initiative could be expanded to include other countries in the region, and potentially other countries outside the region.

IN NUMBERS

70%of corporate lawyers are likely to leave their current positions in 2023.

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JAPAN

DIGITAL AGENCY CREATES DAO FOR RESEARCH

The Digital Agency of Japan has launched a decentralised autonomous organisation (DAO) to explore the functions and roles of DAOs in the web3 ecosystem. The agency is seeking to understand what DAOs can achieve, identify their limitations, and look at issues such as the legal position of governance tokens that are used for voting. In an announcement, the agency also aiming to investigate aspects of digital assets and DAOs that could potentially be misused for cross-border crimes and threaten user protection. The agency also said it will conduct a blockchain analysis of complaints related to the digital asset space from Japan’s authorities, while exploring other initiatives related to digital innovation, including a trial run of a nonfungible token.

SINGAPORE

PILOT PROJECT FOR DEFI SUCCESS

The Monetary Authority of Singapore announced that the first industry pilot under its Project Guardian, which explores potential decentralised finance (DeFi) applications in wholesale funding markets, has completed its first live trades. Under the project, DBS Bank, JP Morgan and SBI Digital Asset Holdings conducted foreign exchange and government bond transactions against liquidity pools comprising tokenised Singapore government securities bonds, Japanese government bonds, the Japanese yen and Singapore dollar. A live cross-currency transaction involving tokenised currency deposits was successfully conducted, along with a simulated exercise involving the buying and selling of tokenised government bonds, demonstrating that cross-currency transactions of tokenised assets can be traded, cleared and settled instantaneously among direct participants.

CHINA

INDIVIDUAL PENSION BUSINESSES OPEN WIDER

The China Banking and Insurance Regulatory Commission (CBIRC) broadened its private pension scheme by allowing large insurance companies to offer individual retirement products to meet the needs of a rapidly ageing population. Insurance companies that want to offer private pension products must have at least RMB5 billion (USD694 million) in shareholders’ equity, with a solvency margin ratio of not less than 150% and a core solvency ratio of not less than 75%. The CBIRC wants to ensure that only large insurers with strong financial capability and experience can participate in China’s private pension market. Any applicant must be well managed, with good governance records free of any disciplinary action for the past three years.

HONG KONG

STAMP DUTY BILL 2022 GAZETTED

The Hong Kong government has published in its official gazette the Stamp Duty (Amendment) Bill 2022, which exempts the stamp duty payable for certain transactions relating to dual-counter stock made by market makers. The proposed stamp duty exemption is to create favourable conditions for market makers to engage in market-making and liquidity-providing activities with lower transaction costs, thereby promoting the trading of renminbi (RMB) stocks, enhancing the use of RMB in the city for investment purposes and contributing to the RMB internationalisation process. The bill was introduced in the Legislative Council for the first reading on 30 November, and is among the new initiatives Chief Executive John Lee Ka-chiu announced in his maiden policy address in October to boost Hong Kong’s status as an international finance centre.



THE PRIMARY ROLE OF AN IP OFFICE IS TO CONTRIBUTE TO THE CREATION OF INNOVATION BY GRANTING APPROPRIATE PATENT RIGHTS THROUGH A PROMPT AND ACCURATE EXAMINATION.

Koichi Hamano
Commissioner of the Japan Patent Office

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SOUTH KOREA

REFORMS UNDERWAY IN INSURANCE SECTOR

The Korean Financial Services Commission (FSC) has announced a plan to reform regulations on insurance businesses to help the sector respond to emerging demands more effectively. The plan has been screened by the financial regulatory innovation committee, and the authorities will prepare revision bills to amend relevant laws for submission to the National Assembly. The FSC has listed areas that require regulatory reforms through discussions within a taskforce and a survey conducted across all financial industry groups. According to the taskforce and the survey, the insurance industry in Korea doesn’t adapt effectively to disruptive changes in the business environment due to outdated and stringent regulations. For example, the level of digital transformation in the insurance market is still at a nascent stage and requires an urgent industrial restructuring.

INDONESIA

FINANCIAL SERVICES AUTHORITY TO SUPERVISE CRYPTO

The government of Indonesia has laid out a plan to move the regulation, supervision and oversight of cryptocurrency investments from the Indonesian Futures Commodity Trading Supervisory Agency to the Financial Service Authority (Otoritas Jasa Keuangan, or OJK) to better protect investors. The new bill is prepared by the Ministry of Finance as part of financial sector legislation that is being debated in parliament. The plan is to empower OJK’s scope in digital assets, and will be passed into law after both the legislative and executive branches have agreed on all provisions. The proposals also contain provisions to widen the central bank’s mandate to include economic growth in addition to price stability.

THAILAND

EASIER RULES FOR FOREIGN EXCHANGE OPERATORS

Thailand’s Ministry of Finance has issued regulations to provide foreign exchange service providers with more flexibility in conducting businesses while raising supervision standards to be more in line with international standards. The regulations, which govern commercial banks, money changers and transfer agents, also allow for new types of services and promote competition. The new measures include allowing companies to register products in the central bank’s sandbox testing scheme for new technologies, and a simplified licensing regime that is part of the Bank of Thailand’s foreign exchange ecosystem development plan to lower service costs and improve access for retail customers.

THE PHILIPPINES

FORMS FOR BUSINESS LOAN APPLICATIONS STANDARDISED

Bangko Sentral ng Pilipinas (BSP) has approved a circular for a borrower-friendly and borrower-centric Standard Business Loan Application Form (SBLAF) to streamline loan applications for micro, small and medium enterprises (MSMEs). All BSP-supervised financial institutions are given 18 months to comply with the small business lending fund (SBLF) requirements. Standardised business loan forms will improve access for MSMEs to credit and financial products. The SBLAF is expected to help MSME borrowers better familiarise themselves with the loan process and find formal loan applications less intimidating, as well as facilitate faster loan processing by increasing the usage of digital loan application platforms.

SOUTH KOREA

REGULATOR TO LAUNCH CRYPTO AUDITING GUIDELINES

The Financial Supervisory Service (FSS) of Korea has drafted a plan to support virtual currency accounting following talks with the Korea Accounting Standards Service and the Korea Institute of Certified Public Accountants. The proposed new measures are intended to boost transparency and reduce difficulties for companies and auditors working with cryptos. The new guidelines will force firms to make disclosures on crypto issuances and token sales, as well as to disclose the tokens they are holding, when they issue mandatory financial statements. The FSS will hold a discussion with another top regulator, the Financial Services Commission, seeking changes to existing accounting legislation with clauses inserted for crypto companies, and distribute a list of best practice protocols and case studies for companies that need to make crypto disclosures.