New Cyber Security law comes into force
China's Cyber Security Law (CSL) came into force on 1 June 2017. The new law covers a wide range of issues including data security, cross-border transfers and data privacy, and sets out obligations for three types of entities namely (1) very widely defined "network operators" under CSL (including owners and administrators of networks, as well as the network service providers), (2) critical information infrastructure operators (CII) (e.g. operators in sectors such as public communication, information services, energy, transportation, water-resources, finance and public service), and (3) suppliers of network products and services. The law also sets out penalties for violating these obligations.
Amongst other requirements, the new law requires that (i) personal information and important data collected and generated by CII in China must be stored within the territory; and (ii) transfer of such data abroad is restricted for business or operational needs and subject to a security assessment (for further details please refer to our previous bulletin on the CSL. Specific measures implementing this cross-border transfer obligation are currently under review (for details regarding these measures please click here and here. In addition, the law also imposed certain obligations for network operators regarding the collection and use of personal information, for example, the network operators must obtain informed consent prior to collecting and using personal data.
New rule requires reporting of Chinese bank cards' overseas transactions
China's State Administration of Foreign Exchange (SAFE) issued a notice in June, which requires banks located in China to report from 2 September 2017 on a daily basis their card holders' overseas cash withdrawals, as well as each overseas card transaction exceeding RMB1,000 (approximately $145). The new rule will be put into force on 1 September 2017. Transactions made by Chinese bank card holders exceeded $120 billion in 2016 and under previous rules China measured only the total amount of overseas transactions made on Chinese bank cards. According to SAFE, the new measure aims at fighting money laundering, terrorist financing, tax evasion and other criminal activities that may involve bank card transactions. China's new rules follow its focus on combating underground banks, which are regarded as a major channel for money laundering and cross-border fund transfers. According to the Ministry of Public Scrutiny, 380 underground banks have recently been uncovered with more than 800 suspects arrested.
Former Chairman of China Resources sentenced to 14 years' imprisonment
Song Lin, the former chairman of state-owned China Resources (Holdings) Co. Ltd (China Resources), was sentenced to 14 years' imprisonment with a fine of RMB 4 million (approximately $587,000) for receiving bribes and embezzling funds. In addition to embezzling public assets worth over RMB9.74million ($1.43 million), Song was found to have accepted approximately RMB23.3 million ($3.43 million) in bribes when he served at various roles in the group, in return for favours in project cooperation, investment and job promotions. China Resources is a large conglomerate of energy, land and consumer businesses operating in mainland China and Hong Kong. Besides Song, other senior executives from China Resources were also prosecuted and/or convicted of bribery.
Multiple government officials sentenced for corruption In recent months Chinese courts have continued to convict a number of former senior officials, following a government pledge to tackle corruption. To name a few, the individuals convicted for bribery and related crimes include:
|Singapore Former senior executive fined
In what has been referred to as one of the largest corruption scandals in Singapore's corporate history, Ong Teck Liam, former financial controller and senior vice-president of Singapore Technologies Marine, has been convicted with other executives for conspiring to facilitate the payment of bribes to Singapore Technologies Marine clients. The executives falsified expenses between 2000 and 2011 to facilitate S$24.9 million in bribes and acted with the approval of key members of the ST Marine management team.
|Malaysia No gift policy introduced in the workplace The Central Municipal Council of Johor Baru has adopted a no-gift policy at work to deter its employees from involvement in bribery. The policy is said to prevent anyone bearing gifts, including hampers, to enter the premises. Johot Baru is the state capital city of one of the most developed states in Malaysia. A ceremony has taken place with its employees who have pledged to abide by a code of ethics and to report any bribery related incidents to the Malaysian Anti-Corruption Commission. The council has also added it has taken action against illegal massage centre operators in areas under its jurisdictions, as this is a venue known to be where gifts are exchanged. Fraudulent investment scheme under investigation
Malaysia's Inland Revenue Board (IRB) and its Anti-Corruption Commission (MACC) has raided several companies thought to be behind a fraudulent investment scheme which has raised more than RM400 million. An investigation has followed five individuals who had founded the companies and collected money to fund several online gambling business, hotels and casinos, having received business licences from a neighbouring country. It is alleged that there is no investment activity within the company and that the individuals instead appropriated the funds for themselves.
South KoreaEx-president's acomplice recieves first sentence
Choi Soon-sil, a known accomplice of South Korea's ex-president, Park Geun-hye (currently on trial for corruption), has been convicted of bribing professors in exchange for her daughter's admission to a prestigious university. The conviction follows multiple criminal cases against Choi, including claims that together, Park and Choi manipulated companies such as Samsung to 'donate' tens of millions to foundations that Choi controlled. Choi has been sentenced to three years' imprisonment following this conviction, but may face decades of imprisonment if convicted on other charges of extortion and abuse of power.Former health minister sentenced for abuse of power
The former South Korean Minister of Health and Welfare, Moon Hyung-po has been convicted of abusing his power as minister to exert pressure on voters in favour of the $8 billion merger of two Samsung Group affiliates in 2015. Hyung-po has been sentenced to 2.5 years' imprisonment; his ruling forms part of several ongoing trials that have emerged from the scandal, which include the ex-president Park Geun-hye. The 2015 Samsung merger sparked multiple allegations and enquiries which then triggered mass scale investigations into allegedly the largest corruption scandal in South Korea's history, leading to the impeachment of ex-president Park Geun-hye.
Vietnam joins BEPS
Vietnam has become the 100th jurisdiction to join the Inclusive Framework (IF) on Base Erosion and Profit Shifting (BEPS). The BEPS refers to tax avoidance strategies that exploit loopholes and mismatches in tax rules, in order to artificially transfer profits to low or no-tax locations. Within the framework, countries and their jurisdictions collaborate to implement the BEPS measures and to tackle BEPS. In addition to this, Vietnam has also stated its commitment to greater tax transparency and expressed its interest to join the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and the Global Forum on Transparency and Exchange Information for Tax Purposes, two mechanisms established for tax cooperation in order to tackle tax evasion. As part of the IF, Vietnam will benefit from the implementation of agreed minimum standards, as well as the peer review processes and guidance under the Platform for Collaboration on Tax which was established among the International Monetary Fund (IMF), the Organisation for Economic Cooperation and Development (OECD) and the United Nations (UN).
IndonesiaThree Air Force personnel named in investigation
Indonesia's military and anti-corruption agency have identified three suspects in a corruption investigation into the purchase of a military helicopter. An investigation was conducted by the Military Police, state auditors and the Corruption Eradication Commission (KPK) which found that the deal for the helicopter did not follow proper procedures and lead to a loss of approximately $17 million, as prices were falsely inflated. It is said several high-ranking Indonesian Air Force personnel were involved in the deal, whilst the Indonesian Military has named three Air Force personnel suspects. Investigators have also frozen an Indonesian company's bank account with a balance of 139 billion rupiah (approximately $10.5 million), who is allegedly connected to the procurement.
Bank of Indonesia works with Attorney General’s Office to fight banking crimes
PT Bank Rakyat Indonesia (BRI) has signed a memorandum of understanding and several other agreements with the Attorney General's Office (AGO) to fight against banking crimes. The agreements cover a commitment by the AGO to provide legal assistance, advice and other legal measures in the fields of civil and state administration law, data and information exchange, asset recovery efforts, banking service provisions and human resources development, among other areas.The partnership's framework will also include law enforcement in special crimes, such as corruption, money laundering and other banking crimes.
New rules to speed up corruption investigations against government employees
The Indian government has amended its inquiry rules setting a deadline of six months for corruption cases involving its employees to be investigated and reported. The new rules came after India's Central Vigilance Commission urged India's public sector banks, insurance companies and central government departments to speed up investigations due to the growing number of complaints that are received yet remain pending.
E-market place to bring more transparency to government procurement
The Indian government has called upon all states to use its Government e-Marketplace (GeM) platform for the sourcing of goods and services. The platform was launched in 2016 and facilitates the procurement of common use good and services required by various government organisations. The GeM aims to enhance transparency, efficiency and speed in public procurement. The platform has been criticised for creating corruption as it lacks mechanisms to act against defaulters and allows products to be sold at inflated prices. Despite such controversy, the Indian government has urged states to use the platform as it would result in significant savings.