Legal Updates

Legal Updates for February 2024

Disposition of Property in Bankruptcy – Can the Court Grant Consent to a Proposed Sale Prior to a Bankruptcy Order
In the course of bankruptcy proceedings, the disposition of property by the bankrupt is subject to a degree of control and restriction, requiring the consent or ratification of the Court. In Re Eng Lee Ling and another matter [2024] SGHC 52, the Singapore High Court considered the scope of the Court's jurisdiction to grant such approval – specifically, in circumstances where prior approval is sought for a proposed disposition of property, and where a bankruptcy order has yet to be made. The Court also provided general guidance on what it expects of the applicant when applying for prospective approval of proposed dispositions.

The Court in this matter declined to grant consent to a proposed sale of property, finding that the applicants had fallen short in demonstrating how the proposed sale would benefit the general body of creditors, and of the requisite good faith. Chua Beng Chye, Cherie Tan and Foung Han Peow of Rajah & Tann Singapore LLP represented the non-party creditor bank in this matter, successfully resisting the debtors' applications for the Court's prospective approval.

Announcements Made at Budget 2024 Regarding Residential Properties
On 16 February 2024, Deputy Prime Minister and Minister for Finance, Mr. Lawrence Wong, delivered the Budget speech in Parliament for the approval of the financial policy of the Government for the financial year 1 April 2024 to 31 March 2025. Several policies were introduced, including changes to the Additional Buyer’s Stamp Duty ("ABSD") regime, and adjustments to the property tax ("PT") rates.

In this Update, we provide a summary of the following key changes to the ABSD treatment and PT rates of residential properties:

• The new ABSD concession for single Singapore Citizen seniors purchasing a replacement private residential property;
• The revised ABSD remission clawback rates for housing developers; and
• The revised annual value bands for owner-occupier residential PT rates.

Singapore Budget 2024: Building Our Shared Future Together
The Budget Statement for Budget 2024 was delivered on 16 February 2024. Given a modest 1.1% in Singapore's economic growth in 2023, expected continued resilience of growth in major economies and looming geopolitical risks, Budget 2024 seeks to assist Singaporeans in meeting their full potential, navigating uncertainties, and building a common, shared future together. At a glance, some key tax measures and changes announced in Budget 2024 are as follows:

1. Tax implications for corporations:
1. ntroduction of a corporate income tax rebate;
   
2. Introduction of a refundable investment tax credit;
   
3. Enhancement of the tax deduction for renovation or refurbishment expenditure;
   
4. Extension and revision of three tax incentive schemes for qualifying funds;
   
5. Introduction of alternative basis of tax for three Maritime Sector Incentive sub-schemes; and
   
6. Introduction of additional Concessionary Tax Rate tiers for certain incentives and schemes.


2. Tax implications for individuals:
1. Top-up of the goods and services tax ("GST") voucher fund;
   
2. Introduction of a personal income tax rebate;
   
3. Enhancement of retirement support schemes; and
   
4. Lapse of Course Fees Relief.


3. Tax implications for residential properties:
1. Amendments to Additional Buyer's Stamp Duty ("ABSD") refund concessions for housing developers and senior citizens;
   
2. Adjustment to Annual Value Bands for owner-occupier residential property tax rates; and
   
3. Introduction of a property tax instalment plan for retirees.


4. Other tax changes:
1. Introduction of an overseas emergency humanitarian assistance tax deduction scheme; and
   
2. Withdrawal of the income tax concession on royalty income.


5. Support for businesses and workers:
1. Enhancements to the Enterprise Financing Scheme;
   
2. Expansion and enhancement of the Energy Efficient Grant;
   
3. Enhancements to the Progressive Wage Credit Scheme;
   
4. Raising the Local Qualifying Salary;
   
5. Extension of the SkillsFuture Enterprise Credit; and
   
6. Implementation of the CPF Transition Offset for the increase in senior workers' Central Provident Fund ("CPF") contribution rates.


6. BEPS 2.0 Pillar 2:
1. Introduction of an income inclusion rule; and
   
2. Introduction of a domestic top-up tax.

In this Update, we discuss the key tax measures, changes, enhancements and extensions, as well as refinements in the existing Singapore tax regime.

Call to Action: Preparing for Changes to the OTC Derivatives Reporting Regime
The Singapore regime for the reporting of specified over-the-counter ("OTC") derivatives contracts is set to undergo a major update. The upcoming changes are a result of the publication of various technical guidance papers by the Committee on Payments and Market Infrastructures and the International Organization of Securities Commissions with the goal of facilitating the aggregation of OTC derivatives data through standardisation and harmonisation of data elements.

The regulatory amendments are expected to come into effect in October 2024. Time is needed to put in place implementation steps towards compliance with the new regulations, reporting entities are encouraged to act sooner rather than later. In this Update, we highlight some practical implementation pointers for consideration and we may assist reporting entities.

Rajah & Tann Asia Intellectual Property Newsletter 2023 - 2024
The field of intellectual property ("IP") has been a hive of activity in the past year. With blockchain and artificial intelligence quickly becoming the buzzwords of the new economy, much attention has been placed on how IP frameworks will evolve and adapt to fit the changing needs of the business world and the innovation economy.

The speed of IP development shows no sign of slowing down, and businesses and IP rights holders would be well advised to keep ahead not just of ongoing developments, but of the trends that may be expected to take shape in the near future. In this annual review, we take a look back at the major legal developments relating to the area of IP in the past year in Southeast Asia. We also look ahead to the trends and expected developments of the year ahead across the jurisdictions in our regional network.

Regional Competition Report 2023
2023 has shown that the Competition regulators in Southeast Asia are a force to be reckoned with, taking a front-seat in the region. Six of the 10 countries now have robust merger regimes with several of the regulators clearly matured enough to tackle difficult transaction reviews, take them into Phase 2 reviews and considering remedies to try and meet parties some way so as to be able to close the merger. Nine of the 10 countries have robust behavioural competition laws, and cartel and abuse investigations have increased in the various countries, where some regulators have not hesitated to penalise individuals directly. An example of the former is the Trade Competition Commission of Thailand which released a detailed 145-page summary decision explaining its decision to approve the Bangchak / Esso merger. An example of the latter is how the Indonesia Competition Commission dealt with cases of bid rigging of road tenders, and in one of them imposed a penalty on an individual for their involvement in the bid rigging. We have in this Annual Report provided an overview of the trends in 2023 and highlighted updates from the final quarter of 2023. We do expect 2024 to be a year where competition issues will be ignored to businesses' peril. Take a step back, take stock as you move forward. We stand ready to assist as always.