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What were the most important legal developments in the last 12 months and how might they affect businesses?
There were some legislative changes in the Macau Special Administrative Region (SAR) during the last 12 months that are worth mentioning. First of all, on May 31 2017, the legislative assembly approved the legal framework for the exchange of fiscal information in order to align Macau with G20 and EU standards. The framework entered into force on June 13 2017. Law 5/2017 standardises the exchange of fiscal information within the countries which are parties to the international conventions and treaties to which Macau is also a party. The law therefore aims to avoid double taxation and tax evasion. One of the innovations of Law 5/2017 is the listing of three separate procedures with the purpose of exchanging any pertinent fiscal information: exchange of information on request of one of the parties to the international conventions and treaties, which shall be understood as the exchange of information when another contracting country requests such information; automatic exchange of information when Macau and another contracting country establish a certain periodicity to exchange information, without specific prior request; and spontaneous exchange of information which comprises an exchange of information between the contracting parties without any request for such information. Regarding personal data matters, Law 5/2017 allows the exchange of fiscal information without the need to notify the personal data subject nor the public authority regarding the transfer of personal data outside Macau, without prejudice to confidentiality rules.
Another development worth mentioning is that, with the transfer of sovereignty over Macau from Portugal to China, the then-Macau territory was bestowed with an offshore regime (Decree-Law 58/99/M, October 18 1999, effective November 1 1999) boasting a comprehensive list of 20 offshore activities of commercial and auxiliary services allowed in Macau. On September 18 2017 the Chief Executive Dispatch no. 323/2017 updated the list of offshore activities allowed in Macau to include trade in goods and services between China and Portuguese-speaking countries, which is arguably one of the single most favourable policies that the government has put forth for the development of Macau as a commercial and trade cooperation service platform between China and Portuguese-speaking countries.
The gaming industry may also see some changes in the near future. Having in mind thealleged negative influences of the gaming industry on its workers, the Macau SAR proposed the enhancement of legislation to promote healthy and sustainable development of the sector. According to the government, the negative effects fall mainly on casino employees, whose role is of vital importance to the development of Macau’s gaming industry and whose tasks may make them particularly vulnerable to the hazards of gaming. Following the public consultation conducted between September 27 and October 26 2017, the Macau government elaborated a proposal to revise Law no. 10/2012 that establishes the legal framework for the conditions of entering, working and gaming at casinos. The amendments proposed have two main objectives: to protect gaming employees from the negative impacts of their exposure to gaming and therefore promote a “responsible gaming” environment, and also to simplify and introduce a more effective sanction procedure in several areas of the gambling legal framework.
Lastly, on June 6 of the current year a new Arbitration Act was approved and is going to replace the two key Acts regulating the arbitration system (i.e. Decree Law no. 29/96/M, dated June 11 1996, which regulates internal arbitrations and Decree Law no. 55/98/M, dated November 23 1998, which regulates external arbitrations related to commercial transactions). The new Act is inspired on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration with amendments as adopted in 2006. It reflects some of the previous stipulations of the Decree Law no. 55/98/M, as well as some of the positive solutions adopted in other jurisdictions and compatible with the Macau legal system. The regime is based on the principle of autonomy, by which the parties are free to choose arbitration as an alternative to courts; the adversarial principle that assures that each party effectively participates in the arbitral proceedings; the principle of equality between the parties; the principle of secrecy of the proceedings; the principle of informality and simplicity; the principle of celerity and efficiency of the tribunal; the principle of impartiality and independence of the arbitrators; and, finally, the principle of minimal intervention of the tribunal, considering the tribunal may only act when specifically entitled to by law. With the creation of a unified regime to the arbitration system in Macau, it is expected for the regime to be more cohesive, and some difficulties of application of the previous acts to be surpassed. It is also expected that these improvements will make the arbitration system more appealing for foreign investors and partners to commit to Macau as the jurisdiction to which they shall submit their disputes.
What are the main restrictions on foreign investment?
There are no restrictions in principle on foreign investment in Macau, since the SAR is a transparent, non-discriminatory and free-market economy, which aims to achieve diversification by attracting foreign investment in new sectors aside from gaming. Furthermore, Macau is recognized as one of the most open economies in the world by the World Trade Organization in terms of investment, as it is a an offshore financial centre, a tax haven, and a free port with no foreign exchange control regimes. As a special administrative region, Macau enjoys a high degree of autonomy in all areas (except defence and foreign affairs), namely its own economic policy, where the Monetary Authority of Macau regulates offshore finance while the Macau Trade and Investment Promotion Institute provides services for investment in Macau.
Therefore, the government’s economic policy goal is to maintain an investor-friendly environment where investors are encouraged to set up new companies, branches or representative offices, with minimal intervention from the public authorities.
What key structuring and other considerations should be highlighted to potential investors/businesses looking to enter this market?
Despite being considered the world’s biggest gambling destination, Macau might be reaching an important turning point, given the growing awareness of the importance of economy diversification. In order to accomplish Macau’s goals, it is of paramount importance to set new rules and procedures to ensure continuous but non-intrusive market control, thus avoiding negative influences.
Aside from all the new legislative developments aimed at increasing Macau’s foreign direct investment, low tax rates teamed with a simple tax regime and a wide range of tax incentives with no discrimination between local and foreign investments have also been important factors in attracting potential investors looking to enter the local market.
Moreover, the Mainland and Macau Closer Economy Partnership Arrangement (CEPA), which is a free-trade agreement signed in 2003 between China and Macau, along with the implementation of the Pan-Pearl River Delta Regional Cooperation Framework Agreement and the development of the adjacent area of Hengqin, have been the catalyst for promoting trade and business between Macau and other regions.
In fact, the new developing Hengqin Island, which covers an area three times the size of Macau, is expected to become a fundamental business platform between Macau SAR, the People’s Republic of China and the Portuguese speaking countries.
Most importantly, there are now major infrastructure projects as the new ferry terminal in Taipa, the recently finished Hong Kong-Zhuhai-Macau-Bridge and the soon to be completed Macau Light Rapid Transit System that are expected to be of big importance to the economy of Macau. In addition, and according to Macau’s five-year development plan (2016-2020), the city aims to become not only a world centre for tourism and leisure, but also, as stated above, a trading and business platform between China and the Portuguese-speaking countries.
Achieving these goals would almost certainly enhance foreign investment into Macau.
Pedro Cortés, senior partner and Manuel Moita Junior, jurist
What were the most important legal developments in the last 12 months and how might they affect businesses?
Among other legislative changes enacted during the last 12 months, several of the new laws and amendments aimed at continuing the opening-up of the Macau SAR market to investors are worthy of particular note.
In order to facilitate and reduce the bureaucracy involved in customs clearance procedures, thus leading to the promotion of MICE (meetings, incentives, conventions and exhibitions) and the logistics industry in Macau SAR, on July 4 206 the Legislative Assembly approved Law 3/2016, amending the existing Foreign Trade Law issued in 2003. This amendment introduced an ATA Carnet (Admission Temporaire/Temporary Admission), which is an international customs document that provides an efficient method for the temporary import of goods, and which greatly eases the way for foreign exhibitions and businesses.
Another change in legislation was published on July 18 2016 – the Administrative Regulation 19/2016, which develops the broad principles contained in the Foreign Trade Law.
Macau SAR has also ratified the WTO Trade Facilitation Agreement (TFA), which contains provisions regarding expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. The TFA will only enter into force when two-thirds of the WTO members have formally accepted the agreement. Macau and Hong Kong have also announced their intention to sign a free-trade bilateral agreement up to the end of 2016.
The Administrative Regulation 9/2016 (published on April 5 2016) established a fee exemption for the issuing or renewal of industry licences, which will further ease the implementation and opening of new companies and businesses.
Last but not least, it is also important to point out the most recent development regarding the authorities’ continuous efforts to combat money laundering and corruption in Macau SAR. Since last May, Macau’s Gaming Inspection and Coordination Bureau (best known by its Portuguese acronym DICJ), set a higher standard for anti-money laundering compliance by introducing new AML measures. The aim of these measures was to implement a risk-based approach and enhance customer due diligence procedures, mainly related to the identification of patrons and the reporting of suspicious transactions.
It is widely known that money laundering is a very serious concern within the Macau gaming industry and, in fact, it is more prevalent in this region than anywhere else in the world. With the entry into force of new instructions to be implemented by casino concessionaires and sub-concessionaires, the government is sending a clear signal that Macau has renewed its commitment to the prevention of money laundering and the financing of terrorism in line with the Asia Pacific Group’s guidelines.
What are the main restrictions on foreign investment?
There are no restrictions on foreign investment in Macau, which is a transparent, non-discriminatory and free-market economy, aiming to achieve diversification by attracting foreign investment in new sectors aside from gaming.
Nonetheless, Macau is also a fully regulated jurisdiction that is seeking a high level of transparency and compliance at all levels. Thus, and as long as foreign investors abide by the local laws, there will be no barriers to inward foreign direct investment. The government’s economic policy goal is to maintain an investor-friendly environment where investors are encouraged to set up new companies, branches or representative offices, with minimal intervention from the public authorities.
What key structuring and other considerations should be highlighted to potential investors/businesses looking to enter this market?
Despite long being considered the world’s biggest gambling destination, Macau might be reaching an important turning point, given the growing awareness of the importance of economy diversification. In order to accomplish Macau’s goals, it is of paramount importance to set new rules and procedures to ensure continuous but non-intrusive market control, thus avoiding negative influences.
As previously mentioned, huge steps have been taken regarding the tackling of corruption and money laundering – two serious obstacles to be overcome to achieve a healthy business and investment climate.
Aside from all the new legislative developments aimed at increasing Macau’s foreign direct investment, low tax rates teamed with a simple tax regime, and a wide range of tax incentives with no discrimination between local and foreign investments, have also been important factors in attracting potential investors looking to enter the local market.
Bilateral investment treaties and double taxation avoidance treaties have been signed with several countries and, as previously mentioned, Macau has also ratified the WTO Trade Facilitation Agreement, so that trading between the Special Administrative Region and foreign countries gradually will be eased. Moreover, the Mainland and Macau Closer Economy Partnership Arrangement (CEPA), which is a free-trade agreement signed in 2003 between China and Macau, along with the implementation of the Pan-Pearl River Delta Regional Cooperation Framework Agreement and the development of the adjacent area of Hengqin, have been the catalyst for promoting trade and business between Macau and other regions.
In fact, the new developing Hengqin Island, which covers an area three times the size of Macau, is expected to become a fundamental business platform between Macau SAR, the People’s Republic of China and the Portuguese speaking countries.
Most importantly, major infrastructure projects are expected to be completed within a few years’ time, such as the new Hong Kong-Zhuhai-Bridge, the new ferry terminal in Taipa and the Macau Light Rapid Transit System. In addition, and according to Macau’s five-year development plan (2016-2020), the city aims to become not only a world centre for tourism and leisure, but also, as stated above, a trading and business platform between China and the Portuguese-speaking countries. Achieving these goals would almost certainly enhance foreign investment into Macau.
What are the most important laws relating to labour & employment?
There have been some recent changes in the labour regime, however, the most relevant pieces of legislation in force in Macau SAR are as follows:
• Decree Law 40/95/M: Employees’ Compensation Insurance Ordinance;
• Law 4/98/M: Framework Law on Employment Policy and Workers’ Rights;
• Law 7/2008: Labour Relations Act;
• Law 21/2009: Law on Employment of Non-Resident Workers;
• Law 6/2004: Law on Illegal Immigration and Expulsion;
• Administrative Regulation 17/2004: Regulation on the Prohibition of Illegal Work;
• Administrative Regulation 8/2010: Regulation of the Law on the Employment of Non-resident Workers;
• Administrative Regulation 13/2010: Regulation on the Conditions or Responsibilities to be Established in Employment Permits for Non-resident Workers;
• Law 6/2015: Regulation on the Right to Compensation to for Occupational Accidents and Diseases; and,
• Law 7/2015: on the Minimum Wage for Cleaning and Security Employees in Property Management Services.
What anti-bribery/anti-corruption laws are in place and how strictly are they enforced?
Since the establishment of Macau as a special administrative region of China, several acts against bribery and corruption have come into effect:
• Decree Law 58/95/M: Sections 336 to 339 of the Macau Penal Code (regarding the bribery of persons who work in the public sector);
• Law 10/2014: Prevention and Suppression of Bribery in External Trade;
• Law 04/2012: Amendment to Law 10/2000, Commission Against Corruption of the Macao Special Administrative Region;
• Law 19/2009: Prevention and Suppression of Bribery in the Private Sector;
• Law 10/2000 republished under Law 4/2012: Organic Law of the Commission Against Corruption of the Macao Special Administrative Region;
• Law 3/2013: Amendment to Law 3/2009, Organisation and Operation of the Service of the Commission against Corruption; and,
• Law 3/2009: Organisation and Operation of the Service of the Commission against Corruption
In line with the long-term process of eliminating corruption, Macau’s government established the Commission Against Corruption (CCAC) in 2000, which has become the main enforcement agency for the prevention, investigation and repression of acts of corruption involving both public and private sectors, according to the Penal Code and the Penal Procedure Code. In fact, the CCAC was granted broad investigative powers, which permit very strict enforcement of the above-mentioned laws, not only by carrying out preventive actions against acts of corruption or fraud but also in investigating those acts.
As regards the penal framework within the private sector, the Macau Penal Code states that passive corruption may be punished with imprisonment of up to one year or with a fine. Active corruption may be punished with imprisonment for up to six months or with a fine.
With respect to the public sector, passive corruption in relation to unlawful acts may be punished with imprisonment ranging from one to eight years. Passive corruption in relation to a lawful act in the public sector may be punished with imprisonment of up to two years or a fine of up to MOP 2.4 million ($300,500). Active corruption in the public sector may be punished with imprisonment of up to three years or with a fine.
What, if any, restrictions are there on repatriating profits to a company’s head office?
Macau is a free port without any exchange controls affecting the flow of capital and hence there are no restrictions imposed on the transfer and repatriation of capital and profits, which makes Macau an ideal place for foreign investment.
How well are IP rights enforced?
The protection and enforcement of IP rights are of paramount importance to Macau SAR’s attempts to attract foreign investment. This is reflected in the legal framework that governs this area, which aims to prevent and punish any IP violation, either through civil litigation or criminal prosecution.
The legal IP regime in Macau is governed by the Industrial Property Act, embodied in Decree-Law 97/99/M (December 13 1999). The act superseded the Industrial Property Code 1995, which was a Portuguese law that had been applicable in Macau until the new act entered into force. Under this regime, IP rights give rights holders full and exclusive enjoyment, use and disposal of their inventions, creations and distinctive signs within the limits, conditions and restrictions established by law.
As a member of the World Trade Organisation, Macau is required to introduce the appropriate legal mechanisms to protect IP rights. In addition, the Paris Convention for the Protection of the Industrial Property has been applicable in Macau since August 12 1999.
Pedro Cortés, senior partner and Manuel Moita Junior, jurist
Rato, Ling, Lei & Cortés – Advogados
Tel: +853 2856 2322
Email: cortes@lektou.com
Website: www.lektou.com
All firms below are in alphabetical order |
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Recommended |
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Jorge Neto Valente Advogados |
Manuela António - Lawyers and Notaries |
MdME |
Rato Ling Lei & Cortés |
Riquito Advogados |
Recommended |
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C&C Lawyers |
DSL Lawyers |
Henrique Saldanha A&N |
Jorge Neto Valente Advogados |
Manuela António - Lawyers and Notaries |
MdME |
Rato Ling Lei & Cortés |
Riquito Advogados |
Recommended |
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C&C Lawyers |
Jorge Neto Valente Advogados |
MdME |
Rato Ling Lei & Cortés |
Riquito Advogados |
Recommended |
---|
C&C Lawyers |
DSL Lawyers |
Jorge Neto Valente Advogados |
Manuela António - Lawyers and Notaries |
MdME |
Riquito Advogados |
All firms below are in alphabetical order |
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Outstanding |
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DSL Lawyers |
Jorge Neto Valente Advogados |
Rato Ling Lei & Cortés |
Riquito Advogados |
Highly recommended |
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Henrique Saldanha A&N |
Manuela António - Lawyers and Notaries |
MdME |
Recommended |
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António Ribeiro Baguinho Advogados |
C&C Lawyers |
FCLaw |
Lou Sio Fong Lawyers & Associates |
Other notable firms |
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BN Lawyers |
Intellectual property and gaming are some of BN Lawyers’ specialisations. Partner Bruno Nunes focuses his practice mainly in the areas of commercial and corporate, gaming and IP.
Advised an Australian proprietary company in a dispute over the ownership of a copyright.
Represented an American multinational transportation network company in Macau in their overall litigation disputing fines against the government.
Advised an insurance group on all legal requirements for the acquisition of majority stake in a local insurance company.
“Very strong practice with Bruno Nunes as a leading practitioner.” – Intellectual property
“Very strong at both client care and technical ability. Easy to work with.” – Intellectual property
“Excellent lawyer – a leader in his field in Macau.”
With a team of over 30 members, C&C Lawyers provides services in corporate law, intellectual property, litigation and notary. Led by partner Álvaro Rodrigues, the firm’s litigation team handles litigation and dispute resolution matters in banking, employment, IP, insurance and real estate.
Advised China Taiping Life Insurance (Macau) on its licensing process.
Acted in the merger of Nova Era and TCM, Macau’s two biggest bus companies, to form Sociedade Transportes Colectivos Macau.
Acted for Macau Horse Racing Company in the capital reduction followed by the increase of capital.
Doppelmayr Garaventa
”Local knowledge and experience.” – Corporate and M&A
“The firm is well equipped with well-experienced legal professionals. They can solve difficult problems whenever necessary.” – Dispute resolution
“The lawyers of C&C are very helpful in our cases.” – Regulatory
DSL lawyers is ranked ‘Outstanding’ in General business law. Capital markets, corporate and M&A, dispute resolution and regulatory are some of the firm’s core practice areas. Managing partner Carlos Simões has particular expertise in financial services investment funds, M&A, private equity and regulatory.
Acted as Macau counsel for JPMorgan in respect of Macau regulatory applying to the opening of investment accounts and provision of a variety of financial services and products.
Acted as legal counsel for Telstra Corporation on its acquisition of a group of IT companies with a presence in Hong Kong, China and Macau.
Advised Tencent Holdings in relation to the sale of virtual currency in Macau through an electronic platform.
ABN AMROG Bank, GRI International, Shun Tak Holdings, Standard Chartered Bank, Sumitomo Mitsui Finance and Leasing Company
Established in Macau since 1970, ‘Outstanding’ firm Jorge Neto Valente Advogados is experienced in banking, gaming, insurance and real estate. The firm’s litigation team has also been busy assisting landowners in litigation related to land lease concession agreements.
Acted for HSBC in the financing of ISA TANTEC Group.
Represented Bank of China (Macau) in the financing of $1.9 billion for the purchase of Sirtex Medical by China Grand Pharmaceutical, Healthcare Holdings and CDH Investments.
Citibank (London), Industrial and Commercial Bank of China (Asia)
Ranked ‘Highly recommended’ in General business law, Manuela António - Lawyers and Notaries is known for its expertise in aviation, banking and finance, and gaming. Partner Hugo Couto focuses his practice on litigation, being involved in several disputes concerning civil, corporate, real estate, insurance and administrative matters.
Assisted Studio City Finance in a refinancing of project enterprise bonds.
Assisted aircraft leasing company AerCap on the sale of two aircraft to Contrail Aviation.
Bank of Communications, DBS Bank, ICBC (Macau)
MdME is known for its speciality in banking, gaming, insurance and real estate. Managing partner Rui Pinto Proença specialises in corporate and M&A, with a focus in highly regulated sectors. The firm has recently opened a representative office in Hong Kong.
Acted for Industrial and Commercial Bank of China in the issuance of $200 million in non-convertible tier 1 capital supplement bonds.
Represented an Italian fashion business in the asset buyback transaction for the acquisition of its existing distribution network in Macau, Hong Kong and China.
Acted for a leading engineering and construction firm in a dispute over the award of the construction of the light rail depot infrastructure project.
“Proactive and practical.” – Banking and finance
“Excellent.”
‘Outstanding’ firm Rato Ling Lei & Cortés specialises in banking and finance, capital markets, corporate and M&A, and dispute resolution. The firm’s industry strengths lie within the gaming, IT and real estate sectors.
Acted for WAC Holdings in its listing on the Growth Enterprise Market of the HKEX.
Acted for Koufu Group in its listing on the Singapore Exchange.
Represented GCA Macau in its application for a license for gaming manufacturer with the Macau Gaming Inspection and Coordination Bureau.
Amazon, Banco BIC (Macau), Bank of China (Singapore)
“Pedro is a very professional lawyer with deep knowledge of the matters and always available to find the best solution. He is one in a kind in terms of the legal industry of Macau with experience and commercial approach.”
Lawyer | Ranking | Practice Area | Firm |
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António, Manuela | Elite practitioner | Banking and finance, Corporate and M&A | Manuela António - Lawyers and Notaries |
Cortés, Pedro | Distinguished practitioner | Capital markets, Corporate and M&A | Rato Ling Lei & Cortés |
Couto, Hugo Ribeiro | Distinguished practitioner | Banking and finance, Corporate and M&A | Manuela António - Lawyers and Notaries |
Cunha, Rui | Senior statesman | Corporate and M&A | C&C Lawyers |
D Simões, Carlos | Elite practitioner | Banking and finance, Corporate and M&A | DSL Lawyers |
Leitão, Francisco | Distinguished practitioner | Dispute resolution | MdME |
Leitão, José | Distinguished practitioner | Banking and finance | MdME |
Martins, Rita | Distinguished practitioner | Banking and finance | DSL Lawyers |
Neto Valente, Jorge | Elite practitioner | Banking and finance, Corporate and M&A | Jorge Neto Valente Advogados |
Olazabal, Tirso | Notable practitioner | Banking and finance | MdME |
Oliveira, Rui Filipe | Distinguished practitioner | Corporate and M&A | Riquito Advogados |
Proença, Rui Pinto | Distinguished practitioner | Corporate and M&A | MdME |
Rato, Frederico | Distinguished practitioner | Capital markets, Corporate and M&A | Rato Ling Lei & Cortés |
Riquito, João Nuno | Elite practitioner | Corporate and M&A | Riquito Advogados |
Rodrigues, Álvaro | Distinguished practitioner | Dispute resolution | C&C Lawyers |
Saldanha, Henrique | Elite practitioner | Banking and finance | Henrique Saldanha A&N |
Sardinha da Mata, Nuno | Distinguished practitioner | Corporate and M&A | C&C Lawyers |
Silva Lopes, David | Elite practitioner | Banking and finance, Corporate and M&A | DSL Lawyers |
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