Transcript + ASEAN Members` Foreign Business Laws

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ASEAN Members’ Foreign Business Laws
Dr. Prapanpong Khumon
School of Law
[email protected]
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ASEAN Statistics
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GDP per Capita in ASEAN
compared with other regions
source: International Monetary Fund 2012
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GDP in ASEAN
5,116 USD
9,941 USD
Source: ASEAN Statistics: Key Indicator 2012
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ASEAN’S FDI Inflow 2013
Countries
Income ($)
2007
2012
Change%
Singapore
46,972
56,651
21%
Indonesia
6,928
19,853
187%
Malaysia
8,595
10,074
17%
Thailand
11,359
8,670
-24%
Vietnam
6,700
8,368
25%
Philippines
2,916
2,797
25%
Myanmar
710
2,243
216%
Cambodia
867
1,557
80%
Brunei
260
850
227%
Laos
324
294
-9%
Total
85,631
111,294
30%
UNCTAD FDI Database 2013 (www.unctad/org/fdistatistics)
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ASEAN Services Liberalization:
Impact assessment
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AFAS Level of Liberalization compared
with other RTAs
GATS
NAFTA
MERCOSUR
USSingapore
AFAS
Scope
W120
W120
W120
W120
W120
Negotiation
Method
Positive
Negative
Positive
Negative
Positive
Ratcheting
No
Yes
No
Yes
No
Transparency
Requirement
Yes
No
No
Yes
No
Freeze clause
Yes
No
No
No
No
List clause
No
Yes
No
No
No
No ceiling
binding
No
Yes
Yes
Yes
No
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Thailand’s Horizontal Limitations to
AFAS Market Access and National
Treatment
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A service provider must be a company limited registered in
Thailand.

Boards and committees must be Thai nationals and Thai residencies.
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A license holder must be Thai national.

Land rights are reserved for Thai nationals.
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Maintain measures relating to subsidies, privileges, minimum
capital, tax, and nationality requirements.
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ASEAN Nations’ Foreign
Business Laws in Comparison
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ASEAN Nations’ Foreign Business Laws
Countries with only Investment Laws

Cambodia (Law on the Investment 2003)
Countries with Investment
Promotion Law + Foreign
Business Law
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Philippines (the Omnibus Code of
1987 and Foreign Investment Act 1991)
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Laos (The Investment Promotion 2009)
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Singapore (Business Reg Act and Company Act)
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Malaysia (Promotion of Investment Act
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Thailand (Investment Promotion Act
and Foreign Business Law 1999)
1968 and
Company Act 1973)
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Vietnam (Law on Investment 2005)
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Brunei (Investment Incentives Order 2001)
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Indonesia (Investment Law 25/2007)
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Myanmar (Foreign Investment Law 2012)
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Foreign Equity Participation
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Countries
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Foreign %
Cambodia
Up to 100% Negative list (prohibited/ reserved / permission
requirements/ JV requirements)
Laos
Up to 100% Negative list (prohibited/ reserved/ permission
requirements/ JV with govt./ JV with locals)
Singapore
Up to 100% Few businesses with req. on local share and Board
nationality
Brunei
Up to 100% Permission and minimum local share partn.
Malaysia
Up to 100% Positive list (JV requirements)
Indonesia
Up to 100% Negative List (prohibited/reserved/JV with locals/ local
share part.)
Philippines
Up to 100% Negative list (reserved/ local share partn.)
Vietnam
Up to 100% As per liberalization commitments/ prohibited list
Myanmar
Up to 100% Negative list (reserved/ JV requirements/ JV with govt./
local share partn.)
Thailand
Up to 100% Negative list (reserved/ permission requirements)
Conditions
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Singapore
Keeping with Liberalization
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Service industry = 70% GDP
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Aim at higher value activities, new growth industries, upgrading
workers’ skills, restructuring social security system\
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Establishing pro-business organizations: Pro-Enterprise Panel,
Smart Regulation Committee (SRC), the Economic Review
Committee (ERC)
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SPRING Singapore (the Standards, Productivity, and Innovation
Board) under Ministry of Trade and Industry to assist locals in:
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Innovation
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Standards
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Consumer protection
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Singapore
Foreign Shares Policy
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100% foreign shares allowed except:
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Legal services: Joint Law Venture (JLV) with locals required, also
QFLP to permit areas for foreign law practice, but arbitration
completely liberalized
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Broadcasting: no more than 49% foreign shares
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Newspaper & Printing: no more than 5% both locals and foreigners
+ nationality requirements for Boards
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Banking: ownership of foreign shares vary upon permission/
Qualifying Full Bank (QFB) up to 25 branches per a foreign bank but
may impose other network restrictions and access limitations to
customers
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Engineering & Architectural services: 100% foreign shares allowed
but impose nationality restrictions and Board composition
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Malaysia
Keeping with Liberalization
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Regulatory reform
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Laws and justice administration (new commercial courts + go
digital)
Foreign promotion: manufacturing, agriculture, tourism, R&D
services, training, environmental
Foreign Shares Policy
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Relaxed JV requirements since 2003
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100% foreign shares allowed in computer related services,
healthcare, tourism (MICE, 4 Stars hotels, tour guide within
Malaysia), some transportation sectors, recreational services, leasing
services
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Indonesia
Keeping with Liberalization
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Challenges in domestic laws on foreign shares restrictions
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Foreign promotion: infrastructure, transfer of technology ind.,
environment, R&D, new industries, industries using local sources
Foreign Shares Policy
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Investment law 25/2007 + Presidential Regulations: 6 lists of allowed
foreign business (subject to revision every 3 years)
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List 1 Foreign Shares Cap (e.g., golf course 100%, direct sales 95%)
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List 2 JV with locals (>5%) (e.g., forestry, maritime, fisheries)
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List 3 Reserved for SMEs (e.g., energy in small scale, culture & tourism,
community broadcasting services)
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List 4 Reserved for locals (e.g., film production, health)
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List 5 Special permission for foreigners (e.g., energy, forestry)
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List 6 Investment not allowed (e.g., defence, public broadcasting)
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Foreign Land Ownership
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Countries
Land Ownership by Foreigners
Land Lease to
Foreigners
Cambodia
No except condos
yes
Laos
No except investment exceeding
500,000$<800 sqm
yes
Singapore
Yes only within business zone or condos
yes
Brunei
No except with permission from Sultan
yes
Malaysia
No except with permission from Economic
Planning Unit for business purpose
yes
Indonesia
No
yes
Philippines
No except agricultural land with size limit
yes
Vietnam
No
yes
Myanmar
No
yes
Thailand
No except investment worth 40 Million THB/
condos but not exceeding 49% of the whole
building
yes
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
More queries please contact:
Dr. Prapanpong Khumon
School of Law
University of the Thai Chamber of
Commerce
[email protected]
The end
© Prapanpong Khumon