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OLN Ranked in ALB’s 2019 IP Rankings

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Asian Legal Business (ALB) has released Intellectual Property Rankings 2019 and we are delighted to announce that OLN has been ranked across all categories in China and Hong Kong.

OLN is ranked at Tier 2 for Copyright and Trademarks, and Tier 3 for Patents  in Hong Kong, and continue to hold its ranking at Tier 3 for both categories in China.

Our Intellectual Property team provides practical advice and solutions with our understanding of the latest regulations and practices, the frequent updates of local government policies and branding positions in Chinese-speaking market.

Congratulations again to the OLN Intellectual Property team for getting ranked.

Vera Sung

Angel Luo

Evelyne Yeung

Marine Vanhoucke

Michael Chan 

About ALB and the IP Rankings

Thomson Reuters’s Asian Legal Business magazine provides current analysis and information on law-related issues throughout the Asia region. ALB drew information from firm submissions, interviews, editorial resources and market suggestions to identify and rank the top firms for Intellectual Property in Asia. The rankings were based on the firm’s visibility and profile in the region, the volume, complexity and size of work undertaken, key personnel hires and growth of the practice group, key clients and new client wins, and its presence across Asia and in individual jurisdictions.

Hong Kong Court recognising Japanese insolvency proceedings for the first time in history in Re Kaoru Takamatsu [2019] HKCFI 802, [2019] HKEC 906

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It is well-settled law in Hong Kong that foreign insolvency proceedings are recognised in Hong Kong provided certain criteria are met. Accordingly, the Hong Kong court is empowered to grant the foreign trustee in bankruptcy or liquidator the powers to administer the company’s affairs in Hong Kong ordinarily vested in such an officeholder under that foreign insolvency regime. The recent Court of First Instance case in Re Kaoru Takamatsu [2019] HKCFI 802, [2019] HKEC 906 was the first case in Hong Kong’s history of a Japanese trustee in bankruptcy applying to the Hong Kong court to seek recognition of the Japanese insolvency proceedings and assistance. In line with the Hong Kong court’s practical approach towards many cross-border insolvency issues, Mr. Justice Harris granted the applicant the rights and powers of a Japanese trustee in bankruptcy ordinarily vested in them in Japan vis-à-vis the company’s assets and affairs in Hong Kong.

Background 
The Japanese company Japan Life Co, Ltd (the “Company”) was ordered to be wound up on 1 March 2018 by the District Court of Tokyo, Twentieth Civil Division (the “Tokyo Court”) and Mr Takamatsu Kaoru was appointed Trustee in bankruptcy by the same court on the same day. Mr Takamatsu, being the applicant (the “Applicant”), applied to the Hong Kong Court of First Instance to seek recognition of the Japanese insolvency proceedings and the relevant powers to obtain access to the Company’s bank account records held by two banks in Hong Kong. The application was made by way of written application through the applicant’s Hong Kong solicitors, supported by a letter of request from the Tokyo Court and an affirmation of a Japanese lawyer explaining the Japanese Bankruptcy Code. 

Legal Principles
In the Judgement, the judge made it clear that the Hong Kong court will recognise the foreign insolvency proceedings if the foreign insolvency proceedings are (i) collective insolvency proceedings; and (ii) the foreign insolvency proceedings are opened in the country of incorporation of the company in question. The judge has defined collective insolvency proceedings as “a process of collective enforcement of debts for the benefit of the general body of creditors” in his judgement for another recent court case.

If the above are satisfied, the judge confirmed that standard recognition and assistance by the Hong Kong court will be rendered to the liquidator appointed in a jurisdiction with similar insolvency regimes to Hong Kong, granting substantially similar powers to those the liquidator is empowered in that jurisdiction on the papers.

Decision of the Judge
In his decision, the judge found that although Japan adopts a civil law system, on the evidence, the Company was in collective insolvency proceedings in its place of incorporation. The judge also found that the rights and powers of a trustee in bankruptcy appointed in Japan (by reference to the Japan’s Bankruptcy Act), which extend to inspecting books and documents relating to the bankrupt’s estate, are similar to those of a trustee appointed in Hong Kong. The judge therefore held that it is consistent with established legal principles to grant the Applicant general powers to administer the Company’s affairs, including its assets and seeking documents and information located in Hong Kong.


Conclusion
This particular case serves as the archetypal example where courts in Hong Kong respects and recognises the status of Japanese laws in the area of insolvency and bankruptcy. It undoubtedly serves as a favourable precedent for Japanese liquidators and trustees in bankruptcy facing similar circumstances and needing assistance from the Hong Kong Court. Such decision is a welcoming one. 

OLN provides a full range of legal services catered to our Japanese clients. If you have any questions regarding the above or on any insolvency issues, please contact one of the members of our Japanese Desk.

OLN Ranked by Benchmark Litigation Asia-Pacific 2019

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OLN ranked “Recommended Firm of 2019” by Benchmark Litigation Asia-Pacific.

Congratulations to our following Practice Areas:

Commercial and Transactions – Tier 3

Family and Matrimonial – Tier 2

Private Client – Recommended

This year, Stephen Peaker has been ranked as Dispute Resolution Star in Family and Matrimonial.

Below is the Benchmark Analysis for our firm:

“Full-service law firm, Oldham Li & Nie is active in commercial and transactions disputes. However, it is particularly lauded for its work in family and matrimonial disputes. The firm’s family law department and probate and estate planning department are led by five partners. Stephen Peaker is a key figure in the family and matrimonial space.

Case highlights include acting on a divorce proceeding involving nearly 30 family trusts in various jurisdictions; acting for Jayjun, a Korean cosmetics brand, in a trademark litigation; and representing Melvin Waxman and Larry Waxman, minority shareholders of a Hong Kong company, in a shareholder dispute.”

About Benchmark Litigation

Benchmark Litigation, the definitive guide to the region’s leading dispute resolution firms and lawyers, was first published in 2008 covering the litigation and disputes markets in the United States and Canada and has broadened its coverage to include Asia – Pacific, Europe and Latin America – becoming a truly global guide.1

OLN Has Been Ranked as Employer of Choice by Asian Legal Business

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This year OLN has been ranked as one of the three law firms in Hong Kong for the 2019 Employer of Choice, Asia’s Best Law Firms to Work For, by Asian Legal Business. The ALB Employer of Choice Rankings were compiled taking into account responses from more than 2500 private practice lawyers across Asia, ranging from managing partners to paralegals, as well as ALB’s market knowledge. 

The ranking was recently published by ALB magazine April 2019 Asia Edition.

Publication No. 295 of China National Intellectual Property Administration – Change of Official Seals and Formalities for Patent and Trademark Prosecutions

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On 18 February 2019, China National Intellectual Property Administration (“CNIPA”), formerly known as the State Intellectual Property Office of China (“SIPO”), announced that:

  • Patent Re-examination Board (“PRB”) will be absorbed by Patent Office effective from 1 April 2019; and
  • China Trademark Office of State Administration for Industry and Commerce (“CTMO”), Trademark Review and Adjudication Board (“TRAB”) and Corporation Center for Trademark Examination (“TECC”) will be combined into Trademark Office of China National Intellectual Property Administration (“TMO”) effective from 1 April 2019.

Effective from 1 April 2019, the examination of patent and trademark matters shall be conducted in the name of CNIPA.  The new official seal of CNIPA shall be put into use, so it will replace the previous seals of PRB, CTMO, TRAB and TECC.

For more details, please visit the CNIPA website at http://www.cnipa.gov.cn/zfgg/1135993.htm.

Note 1: The new/updated formality documents published on 1 March of 2019 are substantially the same as previous ones. The slight changes such as from CTMO/TRAB to CNIPA have not affected applicants’ execution so far.

Note 2: Given that the CTMO and TRAB have been incorporated into the CNIPA, the application and granting of trademarks, patents, layout designs of integrated circuits, and GIs is under the independent governance of the CNIPA. So after 1 April 2019, the CNIPA is the defendant/plaintiff in administrative lawsuits in relation to patent and trademark affirmation and authorization.

Voluntary Arrangement among Beneficiaries on the Distribution of Estate might lead to Stamp duty implication according to a recent District Court decision of Wong Suet Foon Shirly v Collector of Stamp Revenue [2019] HKDC 268

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It is common ground that inheritance tax or estate duty has long been abolished in Hong Kong. The recent case of Wong Suet Foon Shirly v Collector of Stamp Revenue [2019] HKDC 268, however, sheds light on possible stamp duty liabilities under section 27(1) of the Stamp Duty Ordinance (Cap. 117) arising from the assignment of property from the deceased’s estate by way of an Assent to the children of the deceased.

Background

The Appellant in this case is one of the five surviving children of the deceased who died intestate in 20 February 2012. The five children are beneficiaries having equal shares in the deceased’s estate comprising a property under the Tenants Purchase Scheme (租者置其屋計劃) of the Hong Kong Housing Authority (“HKHA”), which restricts alienation. Having received erroneous advice from the HKHA that only two children can become the succeeding owners of the property, the surviving children mutually agreed that 3 of them would renounce their rights in connection with the property, leaving the Appellant and another sibling as the joint tenants of the property. This agreement was effected by a Deed of Family Arrangement dated 3 May 2014. Subject to this Deed, the Appellant, being also the administrator of the estate, executed an Assent on 16 October 2014, thereby vesting the property onto the Appellant herself and the sibling beneficiary.

The Deed was presented to the Inland Revenue Department (“IRD”) for adjudication of any stamp duty payable. An amount of HKD16,650 was assessed and paid. As for the Assent, IRD initially adjudicated that it was not chargeable with any duty. However, the appellant was later informed by a letter of IRD that both the Deed and the Assent were chargeable with stamp duty as conveyances on sale within the ambit of section 27(1) of the Stamp Duty Ordinance, as they “operate as voluntary disposition(s) inter vivos” to the extent that “the transfer(s) of the Property is in excess of the transferee’s entitlement in the estate in accordance with Intestates’ Estate Ordinance”. Consequently, IRD opined that stamp duty at Scale 1 rates (the higher rates) were payable unless the property concerned was a residential property and that the transferor and the transferee were closely related, in which case the lower rates of Scale 2 rates would apply.

The Appellant’s contentions

Dissatisfied with the assessment, the appellant appealed and contended that:- (1) the erroneous advice by HKHA caused the assignment of the property; (2) the transfer was between two close relatives and thereby Scale 2 rates should apply; (3) the transfer of the property under intestacy should be exempted from any stamp duty; and (4) it would be inappropriate to levy the Scale 1 rates stamp duty for the transfer of a property to the beneficiaries succeeding.

Issues before the court

Noting that after the appeal had commenced, IRD changed its stance by written submission that stamp duty would only be payable on the Assent but not the Deed. The issues before the court were:- whether the disclaiming of the 60% interest or entitlement to the property was a conveyance operating as a voluntary disposition attracting stamp duty; and second, if it was, whether Scale 1 or Scale 2 rates should be chargeable.

Decision of the Judge

The two issues were ruled in IRD’s favour. The judge ruled that the Assent constituted a conveyance operating as a voluntary disposition inter vivos within the meaning of s27(1) of the Stamp Duty Ordinance. First, the wording in clause 1 of the Assent clearly stated that it was to be used as an assignment. Secondly, a conveyance operates to assign all rights and interests including beneficial interests and the Assent gave effect to that in the present case, resulting in the Appellant and the sibling beneficiary acquiring the legal and beneficial interest in the property. Thirdly, the Assent must be a conveyance as it conveyed a substantial benefit on the Appellant and the sibling beneficiary in excess of their entitlement. As to the contention point of the erroneous advice of HKHA, the judge found that it had no bearing on the two issues for the fact that HKHA never restricted the number of assignees for properties under the Tenants Purchase Scheme. In light of the above, the judge came to the conclusion that the Assent was chargeable, and chargeable with the amount of HKD16,650.

Conclusion

Whether the appellant will appeal the Judge’s decision remains to be seen and as such, the court’s decision on the two issues is yet to be definitive. Nevertheless, this case serves as a cautionary tale for the possibility of tax liabilities in probate scenarios. Being mindful of that in estate planning avoids unwanted and unnecessary costs incurred from the transfer of estate properties to your loved ones.

OLN provides a full range of probate and trust and tax advisory services. If you have any questions regarding the above or on any tax issues, please contact one of the members of the tax advisory team.