10 Jun ASEAN Today – Regional Legal and Business News – May 2021
ASEAN Today – Regional Legal and Business News for May 2021 including an Immigration Update on the COVID-19 Visa Extension Scheme and Corporate Law News including the Tax Deadline Extension for e-Filing, Shareholders’ lists in Electronic Format for the Registration of Public Limited Companies, and and Update on Social Security Fund RatesDownload PDF
ASEAN Economic Community News
ASEAN Environmental Services Report
ASEAN released its five-year report card on the ASEAN Economic Community (AEC) earlier this month. The ASEAN Secretariat analyzed 1,7000 action lines from the ASEAN 2025: Forging Ahead Together Blueprint and found that there has been a 54% completion rate across the five AEC Blueprint Characteristics with 34% still in progress, 9.2% not started, and 2.5% withdrawn. The bright spots from the past 5 years include the conclusion and signing of the Regional Comprehensive Economic Partnership (RCEP), the operating of the ASEAN Open Skies, ASEAN Single Window, and ASEAN Customs Transit System (ACTS). The time needed to start of business in ASEAN dropped form 24.5 days in 2017 to 14.5 days in 2020. However, the report notes that much of the AEC 2025 blueprint is capacity building by nature for the public sector and to build awareness, so there is a significant disparity between potential impact of the action items and their actual weightage in economic community building. Case in point is the issue of non-tariff barriers (NTBs) in the region. Unfortunately, the elimination of NTBs remains a moving and impossible target to hit. While the member states have agreed to eliminate all NTBs and non-tariff measures (NTMs), the region has struggled to just identify them, let alone any assessment and elimination. Since 2015, the number of NTBs and NTMs has markedly increased with almost no actual eliminations of any existing NTBs.
ASEAN Marine Debris Action Plan
The ASEAN Regional Action Plan for Combating Marine Debris in the ASEAN Member States (2021–2025) was launched this month and is a scalable, solution-focused joint strategy to address marine plastic debris across the ASEAN region. Plastic makes up 80% of all marine debris in the oceans and 6 ASEAN member states alone generate 31 million tons of plastic waste a year. Shared river systems, connected coastlines, and the international trade in plastic products and plastic waste increase the threat of marine debris and the harm it does to the region. The Regional Action Plan will be implemented over the next five years and provides many opportunities for ASEAN members to catalyze, collaborate, and apply long-term solutions relating to plastics usage and plastics management. The Plan includes 14 Regional Actions across four pillars of Policy Support and Planning; Research, Innovation and Capacity Building; Public Awareness, Education and Outreach; and Private Sector Engagement.
Japan-ASEAN Environmental Initiative
Japan announced that it is launching a new initiative to help the 10 ASEAN member states cut greenhouse gas emissions and realize a decarbonized society. Japan will compile a roadmap to decarbonization, set up a US$10 billion public and private investment and loan facility, and encourage the development of renewables and tougher energy conservation measures. The US$10 billion will be invested and lent through the Japanese government and megabanks for specific purposes such as energy-saving efforts, renewable energy sources, and moving from coal to liquefied natural gas for thermal power generation, and having coal powered power plants mix coal with ammonia to reduce carbon dioxide emissions. 80% of ASEAN’s electricity comes from thermal power generation using fossil fuels such as coal.
Vietnam plans to start regulating crypto- currencies and the Ministry of Finance established a research group that will begin an in-depth study of cryptocurrencies to start the process of legislative reform. Cryptocurrency trading and use is currently not legal in Vietnam, but experts believe that over 1 million Vietnamese currently use crypto-currencies and expect the number to reach 30 million by 2030. However, cryptocurrency crimes are increasing including currency thefts, regular hacks, and cyber scams, and legislation to manage and handle virtual assets is becoming necessary. The cryptocurrency market in Vietnam could be very profitable in the future and Vietnam is already moving towards a cashless society.
Market Access Restriction Lists
Vietnam’s new Investment Law came into effect at the beginning of 2021 and one of its implementing regulations, Decree 31 which provides guidance on business lines subject to market access restrictions for foreign investors, came into effect on March 26, 2021. Under Decree 31, the business lines where foreign investors are subject to market access restrictions are divided into two parts, the Market Entry list and the Prohibition list. The Market Entry list details the 58 sectors in which foreign investors must satisfy certain conditions to enter the market, and the Prohibition list contains 25 sectors that are completely closed to foreign investments.
ASEAN Collective Investment Schemes
The Philippines became the fourth signatory to the ASEAN Collective Investment Schemes (CIS) Framework when the Securities and Exchange Commission of the Philippines signed a supplemental memorandum of understanding with the Securities Commission Malaysia, the Monetary Authority of Singapore, and the Securities and Exchange Commission of Thailand earlier this month. Now, qualified investment companies in the Philippines will be able to offer eligible funds to retail investors in the other three member jurisdictions and vice versa. The CIS came into force in May 2020 and is part of the ASEAN regional capital market plan and will facilitate cross-border product access and fund distribution for investors and issuers.
Indonesia announced that it plans to overhaul the country’s tax system including implementing a carbon tax to help curb greenhouse gas emissions, raising value added tax (VAT) rates, and reforming income tax. Revenue from the carbon tax would be invested into environmentally friendly sectors and welfare programs. Indonesia also plans to launch another tax amnesty program like the one from 2016 where 1 million taxpayers declared US$336 billion worth of assets and repatriated US$150 billion back into the county.
Carbon Credits Exchange
Singapore plans to launch a new global exchange and marketplace for high-quality carbon credits this year that will be backed by the Singapore Stock Exchange and multinational banks, and a state investor. Due to increasing pressure to cut carbon commissions and adhere to sustainability plans, companies need access to carbon credits to offset emissions. Experts say that the voluntary carbon market need to expand to 2 billion tons of carbon credits a year by 2030 to enable companies to meet the goals set under the Paris climate agreement. The new exchange will capitalize on Singapore’s reputation as a leading financial and trading hub and help solve the problems within the current fragmented carbon credit markets characterized by thin liquidity and credits of questionable quality.
Industry experts say that the offering of insurance products through financial institutions and banks, bancassurance, will play an increasing role in the emerging insurance sector in Cambodia. The National Bank of Cambodia has approved 18 banks and two microfinance institutions to offer bancassurance through referrals to existing insurance companies and a law released earlier this month now allows them to start offering insurance products in an attempt to increase the public’s access to the sector.
THAILAND LEGAL REVIEW
Extension of State of Emergency
The Thai Cabinet decided to officially extend the State Emergency Decree from May 31 until July 31, 2021. The extension was necessary because COVID-19 is still spreading in many other countries worldwide and infections continue to rise. Certain countries are still in lockdown and this impacts international travel.
60-day COVID visa extension scheme
Given that the State Emergency Decree has been extended to July 31, 2021, the Immigration Bureau will subsequently continue to allow foreigners who are stranded in Thailand and cannot leave to be able to continue to stay in the country (this visa scheme was previously announced to end and only implemented until May 29). Foreigners in all types of visa holder categories shall be eligible to apply for 60-day COVID visa extensions until July 29, 2021, provided that they are qualified based on the requirements set by the Immigration Bureau.
Corporate Law News
Tax Deadline Extension for e-Filing
According to the Ministry of Finance Notification on the extension for filing tax returns and tax payments via the internet system (No.5), dated May 14, 2021, the deadline for e-filing and payment of Withholding Tax (WHT) and Value Added Tax (VAT) for the months of June and July will be extended as follows:
|Withholding Tax Return
(Por.Ngor.Dor. 1, 2, 3, 53, 54)
VAT Remittance Return
|7 Jul 2021||15 Jul 2021||30 Jul 2021|
|9 Aug 2021||15 Aug 2021||31 Aug 2021|
|15 Jul 2021||23 Jul 2021||30 Jul 2021|
|16 Aug 2021||23 Aug 2021||31 Aug 2021|
Shareholders’ lists in Electronic Format for the Registration of Public Limited Companies
The Notification of the Department of Business Development on the submission of shareholders’ lists in electronic format as a supporting document for the registration of a public limited company, B.E. 2564, became effective on May 6, 2021. The Notification will aid applicants with the registration of public limited companies and conforms to the Government’s policies on the utilization of technology. Such applicants will be able to submit the lists of shareholders in electronic formats (compact disc, QR Code, or URL/URL with a reference number) instead of in paper format by submitting it with the cover letter as prescribed by the law from June 2, 2021 onwards.
Update on Social Security Fund Rates
The Ministerial Regulation of the Ministry of Labour regarding contribution rates B.E. 2564 will become effective from June 1, 2021. The rates submitted to the Social Security Office will be reduced between June and August 2021 from 5% to 2.5% for employers and insured under section 33 and from 432 baht to 216 baht for insured under section 39.
The summary of contribution rates is as follows:
|Month||Employer||Insured under Section 33||Insured under Section 39|
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.