LCQ News Alerts

Dubai: One License for all free zones?

The Dubai Free Zone Counsel (the “DFZ Council”) has tentatively agreed at their 12th meeting to permit companies operating in a Free Zone to operate in other Free Zones in Dubai without the need for multiple licenses and separate office spaces. This initiative, along with other initiatives such as the Foreign Investment Law (Federal Law no. 19 of 2018), which allows foreign shareholders to own up to 100% of the shares in companies within the mainland in certain economic sectors, can be seen as a way to encourage foreign investment into Dubai and invite more businesses to open in both the mainland and Free Zones. While the details and Laws surrounding the “Free Zone Collaborate”  have yet to be announced, it is positive that the DFZ Council has come to a tentative decision about it and we look forward to informing you once further details have been announced.

Please contact Hooriya Qazal at moc.e1566603742taico1566603742ssaqc1566603742ocel@1566603742rqh1566603742 in case of questions.

Switzerland - Retrocession – Swiss Federal Court confirmed criminal sanctions (fraud and mismanagement of property).

Federal Court ruling dated 14 August 2018 and published on 14 May 2019,  confirmed that the board of directors of a wealth management company has a duty to protect the rights of the company’s clients. Thus, withholding information owed to clients or providing misleading information or omitting to report in violation of the duty of good care and fidelity (section 398 para. 2 of the Swiss Code of Obligations) is deemed to trigger a criminal  fraud (by omission) within the meaning of section 146 of the Swiss Criminal Code and may constitute an act of mismanagement of the board of directors towards the company’s clients punishable under section 158 of the Swiss Criminal Code. Thus, it is important to provide clients with clear and accurate information on retrocessions/incentives received to avoid possible criminal proceedings.

Please contact Dominique Lecocq at moc.e1566603742taico1566603742ssaqc1566603742ocel@1566603742lrd1566603742 in case of questions.

Switzerland - Switzerland becomes one of the most attractive jurisdiction for corporate tax in Europe.

Significant decrease in corporate tax from 24.2% to 13.99% in Geneva, Switzerland.

On 19 May 2019 Swiss voters have accepted the Federal Act on Tax Reform and AHV Financing (social charges) (“FAAF”). At the same time, the canton of Geneva has amended its companies taxation act to implement the FAAF.

The purpose of the FAAF is to establish a system of corporate taxation that is in line with international requirements while maintaining Switzerland’s competitiveness.

The main consequences of the FAAF are the following for Geneva:

  1. Significant decrease in corporate tax from 24.2% to 13.99% in Geneva, Switzerland.
  2. Abolishment of cantonal regimes of tax privileges applicable to companies whose main activities are carried out abroad (“Special Tax Status”).
  3. Slight increase of the federal dividends tax.
  4. Reduction of the taxation applicable to patent profits with a maximum discount of 90% (patent box). The canton of Geneva will apply a maximum discount of 10%.
  5. Possibility for the cantons to implement up to 50% tax exemption on the research and development expenses.

Entry into force: 1st January 2020