Company News

The U.S. Internal Revenue Service has issued reminders to all U.S. citizens with bank or other financial accounts in a foreign country, or signature authority over such an account, that they may be required to report the account to the U.S. Department of the Treasury by June 30 each year.

Following the issuance of the “Vehicle and Vessel Tax Law of the People’s Republic of China (PRC Presidential Decree No.43)”(VVTL) passed by the Standing Committee of the National People’s Congress on February 25 this year, the Legislative Affairs Office of China’s State Council has also released the “Ordinance for the Implementation of the VVTL of PRC (Draft for Public Opinions)” (Ordinance Draft) on June 14, 2011.

While it is always nice to receive presents at companies’ promotional events, consumers in China should now make sure it is really a free lunch before accepting them. According to a recent circular co-issued by the Ministry of Finance and State Bureau of Taxation, individuals may need to pay individual income tax (IIT) on some gifts they receive under certain circumstances.

The State Administration of Taxation and the Ministry of Finance jointly promulgated the Circular on Continuously Carrying out Transitional Business Tax Exemption Policy on Cross-border Equipment Lease Contracts (Caishui [2011] No. 48) on June 10, 2011, which came into effect the same date.

The Ministry of Commerce (MOFCOM) issued the Interim Provisions of the Ministry of Commerce on Issues Related to the Implementation of the Security Review System for Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (“Interim Provisions”), which took effect on March 5, 2011 and will remain valid until August 31, 2011.

The Ministry of Finance held a conference in Ho Chi Minh City to support Korean businesses relating to problems with taxes and customs procedures during their business in Vietnam. The Korean business groups now have the opportunity to solve their problems with tax and custom procedures with the Vietnamese authorities.

The Indian government has decided to raise the limit of external commercial borrowings to US$30 billion from the current US$20billion while, in another decision, the government has decided not to raise the foreign investor’s limits in government bonds.

India signed a double taxation avoidance agreement (DTAA) with the Federal Democratic Republic of Ethiopia on May 25, 2011 for the prevention of double taxation and fiscal evasion with respect to taxes on income.

The Ministry of Corporate Affairs in India has issued a new circular kick starting the “Green Initiative in Corporate Governance” by allowing companies to complete electronic, paperless compliance after considering relevant sections of the Information Technology Act (2000) and the Companies Act (1956).

In order to support foreign direct investment into India, the RBI has loosened up the rules and now permits foreign investors to raise funds by pledging shares of Indian companies to banks without its authorization.