ASEAN Today – Regional Legal and Business News – August 2019

ASEAN Today – Regional Legal and Business News for August 2019 including a new Medical Certificate requirement for work permits and an overview of the new appurtenant property rights for immovable property


ASEAN Economic Community News

ASEAN Telecommunications Council
ASEAN telecommunications regulators, OTT service providers, and network service providers met in Bangkok this month at the ASEAN Telecommunication Regulators’ Council (ATRC) to discuss OTT service management and regulation. Over the top (OTT) is the term used for media services offered directly to viewers over the Internet that bypass traditional cable, broadcast, and satellite platforms. With the rapid growth of OTT services, properly regulating them has been a continuing challenge for governments and regulators, especially over taxation matters. The four main agenda items at the ATRC meeting were OTT business enhancement, consumer protection, economic contribution, and guidelines for ASEAN which include licensing, self-regulation, industry promotion, and digital service charges.

WWF Sustainable Banking Assessment
In its recently released 2019 Sustainable Banking Assessment (SUSBA), the World Wide Fund for Nature (WWF) maintains that ASEAN banks are delaying their response to climate change and environmental degradation which could lead to financial instability and social unrest. The WWF assessed 35 ASEAN banks using six factors: policies, processes, people, products, and bank portfolio. The study found that out of the 35 assessed banks, only 4 banks from Thailand and Singapore fulfilled at least half of the study’s 70 criteria and 51% of all the banks fulfilled less than a quarter of them. Positively, 74% made improvements compared to 2018 and some banks prohibited the financing of new coal power plants and implemented no-deforestation commitments. Demand for overall green investment is expected to keep growing, but the 51% of the assessed banks offering green financial products mainly focus on renewable energy.

Regional Online Fraud
A new report by a multinational professional services company says that financial institutions worldwide are losing billions of dollars a year due to transaction and digital fraud. One of the consequences of technology and the internet transforming the payment market is the commensurate growth of online data fraud. Experts say that ASEAN is the most vulnerable region for fraud in Asia Pacific (APAC). Southeast Asian losses were 40% of APAC’s total fraud losses of US$650 million. The leading fraud method in ASEAN is the bot attack, especially in Vietnam, Singapore, and Indonesia. Thailand and Malaysia are prone to click flooding and the Philippines is susceptible to install hijacking. The strength of the region’s losses is attributed to ASEAN’s significant scale of markets and the extensive mobile internet penetration in the region.

ASEAN Bamboo Congress
The first ASEAN Bamboo Congress was held in the Philippines this month and was attended by government officials, scientists, and researchers from ASEAN and representatives from Brazil, Qatar, Peru, and the World Bamboo Organization. A versatile renewable resource, bamboo protects the environment and can reduce the demand for traditional wood-based products. The Congress resolved to enhance partnerships to help generate science-based strategies to improve the conditions of bamboo forests and dependent industries in ASEAN and share best practices to increase the appreciation and acceptance of bamboo as a cost-effective green product as an alternative to plastic, metal and wood materials.

Myanmar Update
New Copyright Law
Myanmar recently enacted its new Copyright Law which replaces the previous Copyright Act of 1914. The new law includes updated definitions of performance and broadcasting and deems computer programs as works of writing. Foreign works created by non-citizens or non-residents will only be afforded protection if they are first published in Myanmar or published in Myanmar within 30 days of publication abroad. Copyright protection is in force during the creator’s life and for 50 years after death. Audiovisual works and films are protected for 50 years from the release date, and works of applied art are protected for 25 years.

Malaysia Watch
Digital Content Ecosystem Policy
Malaysia announced that it will finalize the country’s Digital Content Ecosystem (DICE) policy by the end of the year. DICE will focus on strengthening human capital and the industry’s value chain, driving the commercialization of intellectual property, and bringing the ecosystem up to global standards. Malaysia’s animation and gaming sectors continue to grow and attract foreign direct investment and provide jobs to local software developers, graphic designers, and illustrators.

Singapore News
Economic Challenges
Experts anticipate seeing more soured debt for Singapore companies as the country’s economy will be increasingly affected by the US-China trade war. Singapore has already cut its economic growth forecast to almost zero for 2019. Excluding banks, borrowers in the Singapore dollar bond market face US8.6 billion of bonds maturing in 2020.

Indonesia Update
Deforestation Ban
Indonesia’s temporary moratorium on forest-clearing permits for plantations and logging became permanent this month. The moratorium was first put in place in 2011 and has been continually extended since then. It prohibits the conversion of primary natural forests and peat lands into oil palm, pulpwood and logging concessions. Critics say that the moratorium is not effective and that deforestation has not slowed in the areas covered by the ban. Loopholes in the moratorium are being blamed for this. While primary forests are protected, secondary forests, defined as any forest that has been previously logged, are not. This has led to the deliberate logging and clearing of primary forests for the purpose of degrading them and changing their classification to secondary forest.

Brunei News
SME Consulting
To boost the competitiveness of the county’s small and medium-sized enterprises (SMEs) and help bring them up to international standards, Brunei’s Darussalam Enterprise (DARe) agency is offering fully-sponsored consultancy programs. Companies wishing to achieve certification in Good Manufacturing Practices (GMP), ISO 9001, and ISO 2200 can apply. An appointed expert will direct the consultancy and guide the business through the certification process over a six-month period.


Immigration Update
Medical Certificate for Work Permits
A new Employment Department regulation on the Medical Certificate requirement for all work permit applications came into immediate effect on August 19, 2019. Under the new regulation, all Work Permit applications must now include a Medical Certificate, including applications filed under the Thailand Board of Investment (BOI), the Industrial Estates Authority of Thailand (IEAT), and the Petroleum Act (PA). In the past, Medical Certificates were not required for Work Permit applications filed under the BOI, IEAT, and PA as these work permits were issued through special schemes under the BOI Act, the IEAT Act, and the Petroleum Act. The required Medical Certificate must be obtained from a licensed medical doctor in Thailand. The Medical Certificate must be issued within 30 days before filing the work permit application. The Medical Certificate must confirm that the work permit applicant is in good health, able to work in Thailand, and free from the followings 6 diseases: leprosy, tuberculosis, drug addiction, alcoholism, elephantiasis, and stage-3 syphilis. It is highly recommended that work permit applicants use the Medical Certificate template designated by the Employment Department.

Corporate Law News
New Type of Right to Use Immovable Property – Appurtenant Property Rights
On November 27, 2019, under the Sap-Ing-Sith Act (Act), a new type of right to use immovable property will become effective. Sap-Ing-Sith, appurtenant property rights, will be an additional mechanism whereby a real estate owner can create a registered real right to use their real property or immoveable property which can be transferred to a third party. Sap-Ing-Sith should be considered as a new real right in addition to the existing real rights in the Thai Civil and Commercial Code. Sap-Ing-Sith will be an alternative mechanism for real estate owners to enjoy the benefits attached to such immovable property rather than just a renting mechanism which has certain legal limitations. The significant points of the Sap-Ing-Sith Act include:
1. Sap-Ing-Sith is defined as the right to utilize immovable properties, and such right is transferable to any third person or by way of inheritance. In addition, it can be used as collateral by means of mortgage.
2. Immovable properties include: (i) Land with title deed, (ii) Land with structure(s) situated thereon, and (iii) Condominium units under the Condominium Act.
3. To establish Sap-Ing-Sith, the owner of an immovable property shall apply with the competent authority, and the right to utilize Sap-Ing-Sith shall not exceed 30 years. However, for the establishment of Sap-Ing-Sith over immovable property which has been mortgaged or has been used as collateral in compliance with Business Security Act or has any existing registered rights over the related land title deed or condominium title certificate, it shall only be undertaken upon receiving written consent from related mortgagee, collateral receiver, or person having such registered right, as the case may be
4. Sap-Ing-Sith is indivisible. The immovable property which has been used for the creation of such Sap-Ing-Sith shall cover a specific land title deed or a specific condominium unit.
5. After receiving Sap-Ing-Sith registration, the owner of the immovable property is no longer able to establish any proprietary interest over such immovable property unless receiving written consent from the related holder of the Sap-Ing-Sith. However, the owner of such immovable property will have right to transfer ownership of such immovable property to any third party or can use such immoveable property as collateral by means of mortgage or as business security.
6. The owner of the immovable property may terminate the Sap-Ing-Sith before the end of the grant period of use provided that such termination shall not affect the right of the third party, who has, for value and in good faith, acquired and registered their right.
7. The holders of the Sap-Ing-Sith shall have all rights, duties, and obligations over the immovable property with Sap-Ing-Sith as if the owner of the immovable property, but excluding the right to follow and recover from any person not entitled to detain it and the right to prevent any unlawful interference with such immovable property
8. The holder of the Sap-Ing-Sith is able to create, modify, or enlarge any structure. However, at the expiration of the Sap-Ing-Sith, any structure shall be vested with the owner of the immovable property, unless otherwise agreed upon by the owner of the immovable property and the holder of the Sap-Ing-Sith. Nevertheless, this concept shall not apply to condominium units.
9. Any juristic acts to the Sap-Ing-Sith shall be made in writing and registered with the competent authority.

The material contained herein is only provided for information purposes. No part thereof may be deemed to constitute legal advice or the opinions of this law firm or any of its attorneys. Whilst every effort has been made to verify the contents of the material contained herein, we do not represent, warrant, undertake, or guarantee that the information contained in this newsletter is correct, accurate, or complete. Legal advice must be sought before acting on any information contained herein.

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