Items filtered by date: November 2016

Items filtered by date: November 2016

Items filtered by date: November 2016

By Alfred Ip, Partner and Head of Private Client

Hong Kong laws do not recognize same sex marriages. Same sex couples in Hong Kong may not be entitled to marriage rights and benefits but those who plan ahead can still achieve much of the same ends through proper estate planning.

Issues that one should consider are not limited to the disposition of assets. For example, one should consider planning and directing post-mortem arrangements, accumulating and preserving wealth for future generations, ensuring the care of children and pets, benefiting chosen charities and protecting loved ones from annoying opportunists.


Control over One's Estate
A will empowers one to decide everything from who can inherit specific assets like heirlooms to who can care for one's beloved children and/or pets.

Without written directions in a formal will, assets will be distributed in accordance with the Intestate Estate Ordinance, which may not be the way that one wishes assets to be distributed. The intestacy rules can be complicated as they depend upon one’s place of residence as well as the nature of one’s assets.


Ben Keating is a UK banker who came to Hong Kong twenty years ago. His only living relatives are his aging mother in the UK who lives in the same home that Ben grew up in and his brother. Ben’s mother gifted her residence to Ben and his brother ten years ago. Ben owns his residence in Hong Kong.

Jerry Wong is from Hong Kong.

Ben and Jerry met ten years ago and fell in love. Jerry moved in with Ben five years ago. Suppose Ben passed away tragically after a car accident, leaving no will.

In the UK, the spouse of a deceased person without children inherits the entire estate of the deceased person. In Hong Kong, the spouse of a married person without issue inherits the first HK$1 million, then the estate is split into half: the surviving spouse inherits one half and the deceased’s parents/siblings share the other half. Under these circumstances, can Jerry inherit Ben’s estate?

If Ben was domiciled in the UK, the UK intestacy rules would apply to all his personal and real property except for his Hong Kong property. Jerry could inherit all of Ben’s cash (personal property) but would not inherit Ben’s Hong Kong residence. As the closest living relative, Ben’s mother would inherit the property in Hong Kong. Jerry would co-own the UK residence along with Ben’s brother.

If Ben was domiciled in Hong Kong, the Hong Kong intestacy rules would apply to all his personal and real property except for his UK property. Jerry would co-own the UK residence along with Ben’s brother. Ben’s mother would inherit all of Ben’s cash and his Hong Kong property.

Suppose Ben adopted a son last year. Although Ben and Jerry co-parent the child and the three of them lived together as a loving family, Ben had to adopt the child as a single parent in Hong Kong.

Ben’s son is the only person entitled to Ben’s estate in the event of the latter’s death. Ben was the only legally recognized parent in Hong Kong and the child would officially become an orphan. Jerry would have no rights, even though he is the child’s loving father.

The above scenario illustrates just a few of the painful ramifications if one is in a same sex marriage and passes away without a will in Hong Kong.


Providing for a Life Partner
A will is important for those in same sex relationships, particularly if one partner is financially dependent upon the other partner. Unfortunately in Hong Kong, dying without a will leaves one's life partner/same sex spouse without any legal means to inherit one's assets.

Legal guardians can be appointed to care for children in the event of the death of one or both parents. Without such written directions, the care and control of one's children may be decided by the authorities. This is particularly important when the relationship with one's life partner is not recognized in law.

If children require special care (such as ongoing medical needs), it is advisable to appoint financial guardian(s) to ensure that one's wealth will be properly managed to maintain such special needs.


Supporting Good Causes
One should make provisions in one’s will to benefit favoured charities or causes, rather than leaving excess assets to be distributed in accordance with the rules of intestacy.


Overseas Assets
Families often have multi-jurisdictional assets in their portfolios. The administration of such assets is not always straight forward. Unforeseen issues may arise in administering assets overseas. With proper planning and execution, such complications can be minimized.


Affluence attracts opportunists in the form of service providers, distant relatives, friends and even not-so-distant relatives. With a formal written will, one can direct the disposition of one’s assets without opportunists preying upon mourning relatives and friends.


OLN estate planning
With extensive experience and a global network of lawyers, accountants and other professionals, OLN addresses clients' estate planning needs in a comprehensive way.

By Greg Crichton and Adelina Wong, Consultant

The establishment of an independent insurance authority (IIA) in Hong Kong has been six years in the making, starting with a public consultation in July 2010. This culminated in the enactment of the Insurance Companies (Amendment) Ordinance 2015. The policy objective of the reform, including the establishment of the IIA (which is expected to take over the regulation of authorized insurers early next year), is to promote public confidence in the insurance industry and enhance customer protection by, among other things, improving the corporate governance and financial soundness of insurers in Hong Kong.
Authorized Insurers (of which there are currently 161 in Hong Kong) have new corporate governance guidance standards to meet by 1 January 2017 (delayed requirements excepted). Overseas authorized insurers with over 50% of their gross premium income derived from Hong Kong insurance business are included in this group (with an exemption if they are already subject to comparable regulation standards). In particular, Guidance Note (“GN”) 10 issued by the Office of the Commissioner of Insurance (“OCI”), the current regulator of the authorized insurers in Hong Kong, sets out the corporate governance standards to be met.

GN10 – Corporate Governance
GN 10 was recently amended by the OCI in October 2016 to enhance the corporate governance requirements for authorized insurers, highlights of which include the following:
-at least one third of the board to be independent non-executive directors;
-the roles of Chairman and Chief Executive to be separated;
-key persons to be appointed for control functions, including actuarial, financial control, internal audit, compliance, risk management and intermediary management;
-Board to establish an Audit Committee and a Risk Committee and where appropriate, Investment, Nomination, Remuneration, Underwriting, Claims Settlement and Reinsurance Committees should also be established; and
-New requirements regarding remuneration policies and practices covering all directors and employees at authorized insurers, with specific regard to directors, senior management, key persons in control functions and material risk-taking employees.

GN16 – Customer Protection
In the customer protection area, the OCI has also issued new guidance, GN 16 on underwriting long-term business (other than investment-linked Class C business covered by the earlier GN15) on July 30 2015 to impose new requirements aimed at the “fair treatment of customers” throughout the product life cycle. GN16 has been effective as of 1 April 2016 for new long-term products, and will be effective as of 1 January 2017 for new and existing policies for current long-term products. GN 16 imposes new and stringent requirements regarding product design, communications, sales and post-sale arrangements for all of these products. It also has ramifications for the remuneration of insurance intermediaries in that indemnity commission, or any standing arrangement that offers advance payment of commission, is now strictly prohibited.
To give real teeth to GN16, the guidance provides that any attempt by Controllers and/or Appointed Actuaries to circumvent the requirements prescribed in GN16 would be regarded as acting in bad faith, such as may
impact their “fit and proper” assessment and render them unacceptable to the OCI and the IIA (when it takes over from the OCI in 2017).
Generally speaking, it is expected that the IIA, which is charged with the duty to promote proper standards of conduct by authorized insurers and licensed intermediaries in Hong Kong, will enforce existing non-statutory codes and guidelines (including under guidance notes in the appropriate case) in furtherance of this duty, using its expanded investigative and disciplinary powers under the Insurance Companies (Amendment) Ordinance. Notably, the IIA has the power under the Ordinance to take disciplinary action against authorized insurers and insurance intermediaries for breach of conduct requirements. In addition to the imposition of fines, the IIA may suspend or revoke an insurer’s authorization to carry on business or an intermediary’s license

The OLN Insight
The introduction of an independent regulator will no doubt lead to more codes of conduct being put in place which will be enforced through a more robust inspection and investigation regime. Further reforms are on the horizon. For example, the Hong Kong government has clearly signalled its intention to implement a risk-based capital framework for insurers and introduce a policyholders’ protection fund in the next few years. These changes bring Hong Kong in line with international supervisory standards and regulatory trends, and should help to promote public confidence in and the stable growth of the Hong Kong insurance industry, as intended by the government.
However, Hong Kong’s insurance industry will face significant challenges in adjusting to the new regulatory landscape. The cost of compliance will be high and it will be difficult in many cases for Hong Kong insurers to meet the stringent new conduct and governance requirements, including notably the enhanced requirements for independent non-executive directors under GN10. Similarly, new conduct requirements for insurers (including those relating to the “fair treatment of customers” GN16) and insurance intermediaries may lead to a change of distribution strategy and/or drive some of the smaller industry participants to consolidate.

Published in Insurance Articles

OLN has again has obtained some notable awards from leading legal publications:




Asian-Mena Counsel – In-House Community Firms fo the Year 2016:   Intellectual Property

Lawyers World 2016 Country Awards - Most Trusted Commercial Business Law Firm of the Year - Hong Kong 

Asian Legal Business – Immigration Law Firm of the Year

Asian Legal Business – Top 10 Domestic Hong Kong Law Firm


We thank all the clients who have entrusted us with their most important matters, and our staff who were committed in delivering the best legal advice and service to our clients.

Published in Announcements Category

By Anna Chan, Partner


When is a validation order required?

When a company is subject to winding up proceedings, the company’s properties including its bank account would be frozen and could not be dispensed with. To gain access to the company’s bank account in the meantime would require a validation order from the Court.

A mere procedural requirement for Solvent Companies?

The Court’s decision in Cheng Eric Tak Kwong v Emagist Group Limited & Others [2012] ruled that in cases where the winding up proceedings is derived from shareholders’ dispute, the Court would usually grant validation order for the company’s expenses made in the ordinary course of business to enable the proper functioning of the company “once the court is satisfied of the solvency of the company and the fact that it has an active and ongoing business.”

The Court is also has the view that the petitioner’s suspicion on how his fellow director ran the company and conducted its affair is not justification to turn an application for validation order more adversarial and complicated than is necessary. Such concerns of the petitioner can be alleviated in the validation order itself by conditions such as the company’s undertaking to provide a regular summary of expenses.

Unreasonable resistance to validation order. Non-sensible decision in case of Solvent Companies can be costly

In a more recent decision, Marrakesh Investments Ltd v Tangiers Holdings Ltd & Others [2016] (Unreported), the Court has further indicated that litigants should give a pragmatic and sensible approach in dealing with validation orders for solvent companies in order to avoid unnecessary urgent applications made to the Companies Court. In the future, the Court will be more inclined to make punitive costs order on indemnity basis if the petitioner does not sensibly consent to validation order.

What OLN can do for you

OLN has abundance of experience in advising and handling shareholders’ dispute and companies’ winding up matters. For a better understanding of how OLN can assist you, please feel free to contact our partner, Anna Chan.


Published in Dispute Resolution
Tuesday, 22 November 2016 13:46

OLN Applauded in Asialaw Profiles 2017

OLN has again, for the third year, been recognised by Asialaw Profiles 2017 as a highly recommended law firm for a number of areas of expertise.  The areas included Corporate/M&A, Dispute Resolution, and Intellectual Property.   Our Employment and Business Immigration Law practice was highly commended with an “Outstanding” recognition for our advice on labour and employment issues.


Our partners were also distinguished as “Leading Lawyers” by Asialaw Profiles in their areas of expertise:

Richard Healy Dispute Resolution & Litigation
Christopher Hooley Corporate/ M&A
Adam Hugill Labour & Employment
Gordon Oldham Corporate/ M&A, Dispute Resolution & Litigation
Vera Sung Intellectual Property


Published in Announcements Category

OLN’s Family Law Department sponsored The Hong Kong Family Law Association’s (HKFLA) 30th Anniversary cocktail party and gala dinner, which was held on November 10th and 11th, respectively. Partner, and Head of Family Law, Stephen Peaker, who is also the vice-chairman of HKFLA, along with the lawyers of the Department, celebrated this special occasion on the two nights to show our support towards the Association.  It was also an occasion to mix with guests from various organizations, government departments and practitioners who contribute to the development of family law in Hong Kong.


The highlight of the celebratory event was the attendance of Baroness Hale of Richmond (who is the Deputy President of the Supreme Court of the United Kingdom) and The Honourable Chief Justice Geoffrey Ma, GBM, who both attended the two nights of celebrations.



The OLN Divorce & Family Law Practice Team

From left to right: Caroline Choi (Registered Foreign Lawyer), Madelaine Cheng (Associate), Yvonne Kong

(Associate), Stephen Peaker (Partner), Pamy Kuo (Partner), and Jojo Lam (Associate) at The Hong Kong Club

on 11 November 2016.



The Honourable Chief Justice, Geoffrey Ma, GBM, giving his remarks and congratulations to The

HKFLA at the Helena May on 10 November 2016.


Published in Announcements Category

ap leading firm 2017

OLN has again been ranked highly on the Legal 500 Asia Pacific 2017 directory.  The directory rankings are a testimonial from our clients and peers in the industry for our exceptional client servicing standards, strong legal knowledge and commercially viable approaches to helping them resolve matters efficiently and effectively.  We thank our clients and peers for their continued support and belief in us.

We have been ranked in the following areas: employment, intellectual property and litigation.

Our Employment partner, Adam Hugill, again received a “Leading Individual” recognition. Other partners were also recommended by Legal 500 in their area of expertise:

Dispute resolution - Litigation
Alfred Ip
Richard Healy

Adam Hugill
Christopher Hooley

Intellectual property
Vera Sung


Published in Announcements Category

By Anna Chan, Partner

To suppress the overheated property market, the Hong Kong government announced on 4 November 2016 that a flat rate of 15% would be levied on residential property transactions with effect from 5 November 2016 to replace the old rates for ad valorem stamp duty (“AVD”) (originally ranging from 1.5% to 8.5% depending on the value of the property).  The new rate however will not cover non-residential properties such as car parks and industrial properties.The new AVD will be applicable to residential property transactions by individuals and companies, unless an exemption applies.  All previous exceptions continue to apply. In particular, where a residential property is (i) acquired by a Hong Kong Permanent Resident (“HKPR”); (ii) acting on his/her own behalf; and (iii) does not own any other residential property in Hong Kong at the time of acquisition, a lower rate under Scale 2 annexed hereto (at a range from HK$100 to 4.25% of property value) would apply. Scale 2 is also applicable in the following circumstances:-

  • acquisition of a residential property by a HKPR jointly as a co-owner with close relatives (i.e. spouse, parents, children, brothers and sisters) who are not HKPR and each of the purchasers is acting on his/her own behalf and does not own any other residential property in Hong Kong at the time of acquisition;
  • acquisition or transfer of residential properties between close relatives, irrespective of whether they are HKPRs and whether they are beneficial owners of any other residential property in Hong Kong at the time of the acquisition or transfer;
  • nomination of a close relative (irrespective of whether they are HKPRs or not) who are owners of other residential property in Hong Kong at the time of nomination, to take up the assignment of a residential property;
  • acquisition or transfer of a property by a court order or pursuant to a court order, which includes a foreclosure order obtained by a mortgagee whether or not it falls under the definition of a financial institution within the meaning of section 2 of the Inland Revenue Ordinance (“IRO”); and
  • transfer of a mortgaged property under a conveyance to/in its mortgagee that is a financial institution within the meaning of section 2 of the IRO or a receiver appointed by the mortgagee.

Further, no AVD would be charged in the following circumstances:-

  • transfer of a property to a beneficiary of the estate of a deceased person in accordance with that provided under a will or the law of intestacy; or acquired the property by the right of survivorship; nomination of close relatives (regardless of whether they are HKPRs or not) who do not own any other residential property in Hong Kong at the time of nomination; and
  • gift of properties received by charitable institutions exempted from tax under section 88 of the IRO.

Those who own a residential property at the time of acquiring the new one and pay for the higher stamp duty but subsequently sell the original property within 6 months, may apply for refund of overpaid AVD from the Inland Revenue Department.

Rates under Scale 2

Consideration / Market Value Rates Maximum amount
Up to HK$2,000,000 HK$100 HK$100
HK$2,000,001 – HK$2,351,760 HK$100 + 10% of excess over HK$2,000,000 HK$35,276
HK$2,351,761– HK$3,000,000 1.5% HK$45,000
HK$3,000,001 – HK$3,290,320 HK$45,000 + 10% of excess over HK$3,000,000 HK$74,032
HK$3,290,321 – HK$4,000,000 2.25% HK$90,000
HK$4,000,001 – HK$4,428,570 HK$90,000 + 10% of excess over HK$4,000,000 HK$132,857
HK$4,428,571 – HK$6,000,000 3% HK$180,000
HK$6,000,001 – HK$6,720,000 HK$180,000 + 10% of excess over HK$6,000,000 HK$252,000
HK$6,720,001 – HK$20,000,000 3.75% HK$750,000
HK$20,000,001 – HK$21,739,120 HK$750,000 + 10% of excess over HK$20,000,000 HK$923,912
> HK$21,739,120 4.25% N/A

Source: Inland Revenue Department

For a deeper discussion or any enquiry, please contact one of our members of the tax advisory team.

Gordon Oldham
Senior Partner

(852) 2522 6763

Anna Chan
Master of Professional Accounting

(852) 2868 0696

Jonathan Lam

(852) 2868 0696

Victor Ng

(852) 2868 0696

Joey Chan
Master of Professional Accounting

(852) 2868 0696

Terence Siu

(852) 2868 0696

K.F. Yan

(852) 2868 0696

Disclaimer: This brochure is for reference only. Nothing herein shall be construed as legal advice to any person. Oldham, Li & Nie shall not be held liable for any loss and / or damage incurred by any person acting as a result of the materials contained in this brochure. Rates might vary from time to time.


On Novermber 9, 2016, OLN held a seminar on “Insurance Reform:  Corporate Governance & Customer Protection in a New Paradigm” for insurance industry participants and legal practitioners in Hong Kong.  The purpose of the seminar was to give those in the insurance industry a better understanding of the practical impact of new regulatory guidelines which will be enforced by the Independent Insurance Authority (“IIA”), the new independent regulator which will shortly take over the regulation of authorized insurers and insurance intermediaries in Hong Kong. 

Speakers included consultants at OLN, Mr. Greg Crichton and Ms. Adelina Wong, who highlighted changes to the regulatory landscape in Hong Kong, including discussion of new corporate governance requirements for insurers and the implications of high-level principles on the fair treatment of customers for the sale and post-sale administration of long-term insurance products.  Guest speaker Ms. Vicki Wong, Senior External Relations Manager of the IIA, also gave an introduction on the purpose, structure and statutory functions of the IIA, and the key tasks that it will undertake in implementing the new regulatory regime in Hong Kong.


Published in Announcements Category

11 November 2016 (Hong Kong) - Anna Chan has been promoted to partner in OLN’s dispute resolution practice, further strengthening its litigation team. Her promotion, along with Stephen Chan’s appointment as partner, demonstrates the commitment that OLN has to providing its clients with a strong team of seasoned litigators to providing sound and commercial legal advice to their most important matters.


Anna has a wealth of experience in advising and acting for a number of high profile, cross jurisdictional cases involving shareholders’ disputes, companies winding up, debt recovery, civil fraud, derivative action and contentious regulatory matters. Anna has acted for clients in connection with disputes in the High Court and Court of Appeal, including acting as advocate to obtain injunctive relief in cyber-fraud cases in the High Court.


She has successfully obtained Mareva / freezing injunctions, disclosure orders and default judgment in a number of “money had and received” cases. She has successfully defended applications for stay of proceedings based on forum non conveniens and striking out applications, recovering costs in her client’s favour. Anna recently obtained summary judgment in a debt recovery action recouping over US$80M for her client. 


Anna has also advised on tax matters, including planning on tax efficient structure of multi-national insurance broker and hotel chain, advising on tax optimization and compliance issue of a merger and acquisition involving issues of China Corporate Income Tax and Circular 698. 


Gordon Oldham, senior partner, said, “I’m truly delighted to have Anna promoted as partner. She joined OLN as a trainee, and was admitted in 2012. In just a few years’ time, she has been able to master the skills of being a great litigator, as well as being able to provide commercially viable advice to clients on their legal matters. OLN is dedicated to developing top-notch lawyers to support clients in every way we can.”


Anna possesses double degrees in social science and law and she has a Master in Professional Accounting. Before joining OLN, Anna was a credit analyst in one of the largest international banks. Her strong background in accounting provides a competitive edge in tackling complex commercial disputes, especially those requiring forensic accounting and understanding of financials.


For more information on Anna Chan’s profile and expertise, please click here.



Published in Announcements Category
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