Celebrating 25 Years of Success!

ICS TRUST would like to thank you
for your continuous support over the years.

You have been an essential part of our business.

The U.S. Role in Developing Positive Sino-U.S. Trade Ties

Only one week after the European Union announced an anti-dumping tax on Chinese leather shoes and resumed anti-dumping duty against China-made televisions, Canada, the U.S., and the EU have filed a WTO complaint against China in a dispute involving auto parts. Three trade disputes in 10 days and the continuous international pressure on its currency to appreciate has placed additional tension on China’s foreign trade policies. As the Chinese economy continues to grow and spurs foreign trade activities, friction between these nations will also increase. Chinese President, Hu Jintao’s visit to the U.S. this month is anticipated to bring a new dimension of steady and positive development to Sino-U.S. trade ties.

Prior to the Chinese President’s visit, a Chinese business delegation visited the U.S. in early April and signed deals worth US$16.2 billion dollars for the import of aircraft, software, mobile telecommunications equipment, and other high-tech products. China’s leading computer producer Lenovo announced its plan to buy US$1.2 billion dollars worth of products from Microsoft in the next 12 months. High-tech enterprises are a major force behind promoting Sino-U.S. trade and they are also the main beneficiaries of this trade. The U.S. is being careful not to restrict exports of high-tech products to China, which can potentially impair the positive development of trade relations between the two countries.

The rapid expansion of the Chinese market has promoted U.S. exports and has provided a means to narrow the “twin deficit” of trade and finance with the U.S. On the other hand, politicising economic and trade issues is likely to lead to an expected lose-lose situation for the world’s two largest foreign traders. The pace of development of Sino-U.S. economic and trade relations is dependent on the joint efforts of the two countries to achieve mutual win-win results. In the world economy, trade relations between the two nations have much wider international implications. It is perhaps time for the U.S. to take solid actions in developing a mutually beneficial economic and trade relationship with China during President Hu’s state visit.
 

TRADE

Hong Kong

S&P Raises Hong Kong’s Outlook Rating

Standard & Poor’s Ratings Services raised Hong Kong’s outlook from stable to positive. This reflects the territory’s improved fiscal position and bright economic prospects. The S&P report commented that Hong Kong enjoys higher ratings than China because of its large degree of autonomy in domestic policy, international economic relations, and external affairs that is enshrined in the Basic Law. Read more...

Hong Kong Tops as China’s Best Business Centre

Hong Kong is China’s most competitive city according to the annual “Competitiveness Blueprint” released by the Chinese Academy of Social Sciences. The study points out that Hong Kong’s pro-business environment and rule of law are the factors that mainland cities will find difficult to replicate in the short term. Taipei and Shanghai were ranked second and third respectively. Read more...

Hong Kong to Simplify Trademark Application Requirements

The Hong Kong Commerce, Industry & Technology Bureau proposed an amendment to the Trade Marks Rules, which were gazetted at the end of March. Application requirements for trademark transaction of assignments and assents will be simplified and this will facilitate the provision of electronic services for trademark transactions by the Trade Marks Registry. Read more...

China Reveals Plan for IP Protection

The Chinese Ministry of Commerce recently revealed its plan in protecting intellectual property rights. Approaches include clamp down on individuals and organisations that break the country’s IP laws, increase public awareness of IP issues, and establish and maintain a legal framework for IP protection. Read more...

China Opens Up to Offshore Investment

On 18th April 2006, China issued rules for commercial banks to conduct offshore investment, a major step towards opening up China’s tight monetary regime. The move serves to widen investment options available to institutional and individual investors. Domestic households and firms now have official access to overseas securities markets. Commercial banks still need regulators’ approval for offshore investment and will face quotas. Read more...

China’s Free Trade Agreement with Chile to be Ratified

The free trade agreement that was signed in November 2005 by Chile’s President, Ricardo Lagos, and Chinese President, Hu Jintao, at the Asia-Pacific Economic Cooperation forum is expected to be ratified by 1st July 2006. The agreement aims to further strengthen the strong trade ties between the two nations. Read more...

U.S. SEC Rules Impact Offshore Advisers

Professionals pointed out that the U.S. SEC’s hedge fund registration rules is similar to the U.S. Treasury’s abortive 2003 that brings offshore advisers one step closer to being subject to the U.S. anti-money laundering regime. The registration requirements extend to non-U.S. advisors with more than 15 US-resident clients. Read more...

U.S. Approved New Legislation to Lower Cost for American Manufacturers

The U.S. House of representatives approved the Miscellaneous Trade and Technical Corrections Act of 2006, which corrects technical errors in trade laws. Tariffs on imported components used by American manufacturers will be reduced, making American businesses and workers more competitive. Read more...

New EC Initiative to Remove Business Transfer Barriers for SMEs

The European Commission launched a new initiative to help family-owned SMEs in the EU prolong existence by removing obstacles to the transfer of ownership. Thousands of healthy companies and jobs are lost in Europe every year due to difficulties involved in the transfer of ownership. Read more...

CARICOM and U.S. to Discuss Holding Free Trade Talks

Slow progress in Free Trade Areas of the Americas talks has prompted CARICOM to seek alternative routes toward free trade with the U.S. CARICOM and the U.S. decided to revive their long-dormant Trade and Investment Council (TIC) as a vehicle to promote and develop trade and investment between the Caribbean and the U.S. Read more...

BVI Solidify Position as Third Largest Offshore Centre for Captives

The BVI Financial Services Commission revealed a 10% overall growth of its captive insurance business in 2005. Its insurance sector had achieved the best-reported growth amongst offshore domiciles as the pace of captive insurer formations slowed globally. Read more...

Seychelles to Remove Foreign Exchange Controls

The Seychelles expects to remove most of the existing controls on foreign exchange by the end of 2006. The move is designed to help quell black market activity and pull money into legal channels. Read more...

TAX

China

China Expects to Unify Corporate Tax Rate in 2007

According to Jia Kang, President of the Institute of Fiscal Science under the Ministry of Finance, China could introduce a single corporate tax rate for all domestic and foreign companies by 2007. Currently, foreign-funded firms are paying an effective corporate tax rate of 14 % while domestic firms are liable to corporate tax rate of 24%. Read more...

China’s Tax Burden Remains Low Compared to Industrialized Countries

Despite the fact that the amount of tax revenues being collected by the Chinese government has been rising sharply in the recent years, the State Administration for Taxation (SAT) stated that China’s tax revenues accounted for about 20% of its gross domestic product in 2005, which is merely half of the industrialised economies. Read more...

Canada Commits to Cut GST Tax

The Canadian government commits to follow through with its election pledge to cut Goods and Services Tax (GST) by 2% over the course of its mandate, starting with an immediate 1% cut to bring GST down to 6%. The government believes that cutting GST will help all Canadians, including low-income Canadians who need it most. The cut also aims to deal with the rising cost of living, put money back in people’s pockets, and help stimulate the economy. Read more...

U.S. Introduced Legislation to Close Capital Gains “Tax Gap”

The Simplification Through Additional Reporting Tax (START) Act of 2006 requires U.S. brokerage houses and mutual fund companies to track and report to taxpayers and the IRS investment information related to capital gains taxes. The act also aims to simplify the existing tax filing system to make it easier for taxpayers to file their tax returns and to reduce the country’s US$ 17 billion capital gains “tax gap”. Read more...

Lowering Corporate Tax Rates Across Europe

Competition amongst EU member states for jobs and capital and economic liberalization have steadily driven down the corporate tax rates across Europe. The accession of 10 new member states to the EU in 2004, and the continuing efforts of the EU judicial system to break down barriers to free movement of capital, appear to contribute to the increasing tax competition among EU member states. Read more...

EC Moving Towards Consolidated Corporate Tax Base

An expert working group led by the European Commission is making progress on the Common Consolidated Corporate Tax Base (CCCTB) that enables EU companies to follow the same rules in calculating their tax base for all activities within the EU market. EU member states will retain full sovereignty over tax revenues, as they will continue to set their own national tax rates. Read more...

Barbados and Austria Sign Double Tax Avoidance Agreement

Barbados and the Republic of Austria signed a double tax avoidance agreement. The two nations also agreed on the prevention of fiscal evasion with respect to taxes on income and capital gains. The negotiation will lay a solid framework for developing substantial trading opportunities and cultivate a strategic business alliance between the two nations.
Read more...