How can Chinese Foreign-Invested Entities take advantage of ASEAN presented by Chris Devonshire-Ellis
Country of Origin: Great Britain
Office: Singapore Office
1. Introduction to ASEAN, ASEAN+3 and Asian Economic Community
- ASEAN stands for the Association of Southeast Asian Nations,an Inter-Governmental Organization.
- ASEAN was established on 8 August 1967 in Bangkok by the five original Member Countries, Indonesia, Malaysia, Philippines, Singapore, and Thailand. Followed by Brunei, Vietnam, Laos, Myanmar and Cambodia.
- Its main purpose include the acceleration of economic growth, social progress, cultural development among its members, the protection of the peace and stability of the region, and to provide opportunities for member countries to discuss differences peacefully.
- ASEAN plus 3 stands for Association of Southeast Asian Nations plus China, Japan and South Korea.
- The foundation of the AEC is the ASEAN Free Trade Area. It is a trade bloc agreement by the Association of Southeast Asian Nations supporting local manufacturing in all ASEAN countries.
- The objective of the ASEAN Economic Community (AEC) is to transform ASEAN into a region with free movement of goods, services, investment, skilled labour, and freer flow of capital.
2.Market entry tip (1) – using Singapore as the gateway;
- Singapore’s status as a preferred holding company jurisdiction in Asia is primarily attributable to the city-state’s favorable tax regime and close connection to emerging Asian markets.
- With more than 70 avoidance of double taxation agreements, low effective corporate and personal tax rate, and no capital gain tax, controlled foreign corporation rules, or thin capitalization regime, Singapore has one of the most competitive tax systems worldwide. Minimal requirements for establishing a holding company. Overwhelmingly favorable tax and legal systems, the ability to use the holding company as an entrepot trade destination to access ASEAN and other developing Asian markets.
3. Market entry tip (2) – utilising holding structures & other tips.
- At least one shareholder: A singaporean private limited company should have at least one shareholder, but not more than 50.
- At least one director that is a Singapore resident: The shareholder and director are permitted be the same person. The shareholder can be a person or another legal entity, and 100 percent foreign shareholding is permitted.
- A company secretary who is a Singaporean resident: Within six months of incorporation, a company secretary must be appointed. For company with a single single director, the same person is not permitted to also act as the company secretary.
- Paid-up capital: The minimum paid-up capital for the registration of a Singapore company is $1.