Global Transaction Services
APAC
Experience. Insights. Global Capabilities.
Contents
Australia
2
China
4
Hong Kong
6
India
8
Indonesia
10
Japan
12
Korea
14
Malaysia
16
New Zealand
18
Philippines
20
Singapore
22
Taiwan
24
Thailand
26
During 2011, Bank of America Merrill Lynch clients experienced the benefits
of our aggressive expansion throughout Asia Pacific. This year, we are
continuing to build out our Global Transactions Services platform to serve
clients across this critically important region.
Following our rapid and highly successful integration, Bank of America
Merrill Lynch has moved swiftly to ensure that clients across Asia Pacific
have access to best-in-class transaction banking and treasury solutions.
Now, we are more focused than ever on providing a unique and
comprehensive array of integrated services. These include advanced liquidity
management structures such as multi-currency notional pooling, interest
optimization and automated cross-border sweep solutions to efficiently
and effectively manage your regional working capital. Additionally, you can
leverage our full suite of products on CashPro®Online, our innovative
web-based platform that enables complete visibility and control across
all of your operations — for a globally-integrated view of your business.
Our efforts have been recognized by the industry, resulting in a series of
awards for our cash management, trade finance and transaction banking
businesses, including Rising Star Cash Management Bank for the Asia
region and Best MNC/Large Corporate Bank, Australia by The Asset.
With offices or banking arrangements in thirteen Asia Pacific markets,
we are strategically located to serve your needs with the right solutions
and outstanding service.
We appreciate your strong support and continued trust in us.
Sincerely,
Ivo Distelbrink
Head of Global Transaction Services
Asia Pacific
Australia
Population — 22 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $917.7 billion
(2011 est.)
Currency — Australian Dollar (AUD)
Operating Accounts
Savings account – Interest-bearing
Current account – Interest-bearing and
non-interest-bearing
• Resident savings account: Available
• Resident current account: Available
• Nonresident savings account: Available
• Nonresident current account: Available
Languages — English
Types of Entities and Incorporation
Central Bank
The most common forms of business setups for foreign
companies are:
The Reserve Bank of Australia (RBA)
• Domestic subsidiary
• For more information on the RBA, visit:
www.rba.gov.au
• Branch office
Domestic subsidiary
Clearing Infrastructure
High value payments
• High Value Clearing System (RTGS/RITS) —
Bank of America Merrill Lynch Direct Member
Companies in Australia are incorporated (registered) under the
Corporations Act, 2001. The Act is overseen and administered
by the Australian Securities & Investments Commission (ASIC).
An Australian company is usually incorporated as either a
public or private company.
Low value payments
• Bulk Electronic Clearing System (Direct Entry/BECS) —
Bank of America Merrill Lynch Indirect Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Australian Branch
Business since: 1964
Branch address: ABN 51 064 874 531
Level 38, Governor Philip Tower, 1 Farrer Place,
Sydney NSW 2000, Australia
Tel: +61.2.9931.4200
Email: dg.gts_australia@baml.com
Website: www.baml.com/treasurymanagement
2
Branch office
A foreign company may register in Australia to operate as
a branch, in lieu of incorporating a wholly owned Australian
subsidiary. An Australian branch office retains the legal
identities of its foreign parent company. The company must
also formally establish a registered office in Australia and
appoint a local resident agent.
Tax and Regulatory
Corporate tax
Australian companies are generally taxed on their worldwide
income. Nonresident companies that do not operate through
a permanent establishment are generally taxed only on
Australian-sourced passive income. The usual tax rate for
resident and nonresident companies is 30%, although this
varies for nonresident companies subject to withholding tax or
protection by tax treaties.
Withholding tax (non-treaty rates)
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
0%
10%
Royalty
0%
30%
Dividend
0%
30% (0% for franked)
(as of February 2012)
Regulatory environment
The regulatory environment is generally considered to be open.
Central bank reporting
The Reserve Bank of Australia imposes no formal central bank reporting
requirements for corporations.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
− Cheque deposit (over-the-counter)
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Merchant acquiring
• BPay biller
• Global wholesale banknote
Liquidity
• Notional pooling
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Risk distribution
• Supply chain finance
• Electronic trade platform
• ECA/structured export finance
• Trade receivable finance
• Structured trade finance
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
3
China
Operating Accounts
Savings account – No distinction from current account
Current account – Interest-bearing
Population — 1.343 billion (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $11.3 trillion
(2011 est.)
Currency — Renminbi (RMB)
Languages — Mandarin
Central Bank
The People’s Bank of China (PBOC)
• For more information on the PBOC, visit:
www.pbc.gov.cn/english
Clearing Infrastructure
High value payments
• High Value Payment System (HVPS) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Bulk Electronic Clearing System (BEPS) —
Bank of America Merrill Lynch Direct Member
• Shanghai Electronic Intra-city Clearing System —
Bank of America Merrill Lynch Direct Member
• Beijing and Guangzhou paper-based Intra-city Clearing
Systems— Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Shanghai Branch, Beijing Branch,
Guangzhou Branch
Business since: 1970
Branch address: 17th Floor, AZIA Center
1233 Lujiazui Ring Road, Shanghai 200120,
People’s Republic of China
Tel: +86.21.6160.8888
Email: dg.gts_china@baml.com
Website: www.baml.com/treasurymanagement
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Representative office
Domestic subsidiary
A subsidiary is often called foreign invested enterprise (FIE)
in China. The percentage of equity shares held by foreign
investors in a FIE must be no less than 25%. There are two
major incorporation forms that are allowed for FIEs:
• Wholly foreign-owned enterprise (WFOE)
A wholly foreign-owned enterprise is established exclusively
with a foreign investor’s capital. It is a limited liability
company, the profits and losses of which are borne solely by
the foreign investor.
• Joint venture (JV)
A joint venture is a separate legal entity and takes the
form of a limited liability company registered in China.
The partners have joint management of the company, and
the profits and losses are distributed according to the ratio
of each partner’s capital injection.
Representative office
Representative office is not a separate legal entity, it is an
extension of the foreign parent company. A representative
office may only engage in non-profit-making activities and is
restricted from directly engaging in any business for profit.
Tax and regulatory
Corporate tax
The standard company income tax rate is 25%. Special rates
apply to qualified small-scale companies and thin-profit (20%)
and new/high-technology companies that are specifically
supported by the State (15%).
4
Withholding tax (non-treaty rates)
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
0%
10%
Royalty
0%
10%
Dividend
0%
10%
(as of February 2012)
Regulatory environment
The regulatory environment in China is complex, strict and dynamic. The
RMB is a restricted currency and cross-border trading is regulated and
controlled by the State Administration of Foreign Exchange, which
is a division of the central bank.
Central bank reporting
The central bank and government reporting requirements have significant
impacts on treasury management activity.
Payments
• Cashier’s cheque
• Corporate cheque
• Wire
• Bank draft
• RTGS (domestic and international)
• ACH and GIRO
• Direct debit payment
• Payroll
• Commercial card (corporate card only)
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
• Wire (domestic and international)
• ACH and GIRO
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Entrustment loan
• Interest optimization
• Time deposit/call deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
• Domestic RMB commercial draft
• International RMB capability
• Domestic trade finance to FI
5
Hong Kong
Population — 7.2 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $350.4 billion
(2011 est.)
Currency — Hong Kong Dollar (HKD)
Languages — English, Cantonese
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Branch office
• Representative office
Domestic subsidiary
A subsidiary is essentially a private limited company
incorporated in Hong Kong. Hong Kong allows 100% foreign
ownership of companies, which implies that you can set up
a wholly-owned subsidiary company in Hong Kong.
Central Bank
Hong Kong Monetary Authority (HKMA) (functional equivalent)
Branch office
• For more information on the HKMA, visit:
www.info.gov.hk/hkma
A branch office is a legally-incorporated entity that is treated
as an extension of the foreign parent company and is not a
separate legal entity in its own right. This makes the foreign
parent company accountable and responsible for all the debts
and liabilities of the branch office.
Clearing Infrastructure
High value payments
• Clearing House Automated Transfer System (CHATS) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Electronic Clearing (ECG) —
Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Hong Kong Branch
Business since: 1959
Branch address: 42nd Floor, Two International Finance Centre,
8 Finance Street, Central, Hong Kong
Tel: +852.2847.5222
Email: dg.gts_hongkong@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Interest-bearing
Current account – Interest-bearing
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
6
Representative office
A representative office is restricted to carrying out
promotion and liaison activities, undertaking market
research and coordinating activities on behalf of the foreign
parent company. A representative office cannot engage in
profi t-making activities and is not treated as a separate legal
entity. Since a representative office has no separate legal
standing, the foreign parent company bears implicit liability
for its activities.
Tax and Regulatory
Corporate tax
Generally, only Hong Kong-sourced income is subject to Hong
Kong profits tax. In determining the source of profits, Hong Kong
generally adopts the “operations test,” which involves identifying
activities that are most important in generating the profits and
the place at which these activities are carried out. Profits tax is
levied at a rate of 16.5% (15% for unincorporated businesses) on
companies carrying on business in Hong Kong and the relevant
income earned in or derived from Hong Kong.
Withholding tax
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
0%
0%
Royalty
0%
4.95%
Dividend
0%
0%
(as of February 2012)
Regulatory environment
Hong Kong is generally considered an open territory in which currency
and other monetary restrictions are not regarded as particularly stringent.
Central bank reporting requirements have minimal impact on cash
management activity.
Central bank reporting
The Hong Kong Monetary Authority (HKMA) imposes no formal central bank
reporting requirements for corporations.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Branch collection points
− HKD and USD cash deposit
and withdrawal
− HKD and USD cheque deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Notional pooling
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Major regional trade processing hub
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Risk distribution
• Supply chain finance
• Structured trade finance
• Electronic trade platform
• International RMB capability
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
7
India
Operating Accounts
Savings account – Not available for corporate
Current account – Non-interest-bearing
Population — 1.2 billion (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $4.463 trillion
(2011 est.)
Currency — Indian Rupee (INR)
Languages — English, Hindi
• Resident current account: Available
• Resident savings account: Not available
• Nonresident current account: Available (restricted)
• Nonresident savings account: Not available
Types of Entities and Incorporation
The most common forms of business setup for foreign
companies are:
Central Bank
• Domestic subsidiary
The Reserve Bank of India (RBI)
• Joint venture
• For more information on the RBI, visit: www.rbi.org.in
• Branch office
• Representative office
Clearing Infrastructure
Paper clearing
• Cheque clearing including speed clearing —
Direct Member at Bank of America Merrill Lynch locations
(through partner banks at other locations).
• Cheque Truncation System (CTS) —
Bank of America Merrill Lynch Direct Member
• Project office
Domestic subsidiary
A foreign company can set up a wholly-owned subsidiary in
sectors where 100% foreign direct investment is permitted
under the Foreign Direct Investment (FDI) policy and under the
Indian Companies Act, 1956.
High value payments
Joint venture
• Real Time Gross Settlement (RTGS) —
Bank of America Merrill Lynch Direct Member
A foreign company can set up a joint venture company under
the Indian Companies Act, 1956. Many foreign investors prefer
to set up a joint venture with an Indian partner company as this
can give them access to the partner’s pre-established market
and distribution channels, local management and know-how.
• National Electronic Funds Transfer (NEFT) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Electronic Clearing Service (ECS) /National ECS (NECS) —
Bank of America Merrill Lynch Direct Member
Branch office
Bank of America Presence
A foreign company engaged in manufacturing and trading
activities abroad is allowed to set up branch offices in India for
certain activities. Branch offices on a “stand alone basis” are
isolated and restricted to the Special Economic Zone (SEZ) alone
and no business activity/transaction is allowed outside the SEZs
in India.
Bank of America, N.A., Mumbai Branch, Bangalore Branch,
Kolkata Branch, Chennai Branch, New Delhi Branch
Business since: 1964
Branch address: Express Towers, Nariman Point
Mumbai, Bombay 400-021, India
Tel: +91.22.6632.3000
Email: dg.gts_india@baml.com
Website: www.baml.com/treasurymanagement
8
Representative office
A representative office cannot undertake any commercial
activity directly or indirectly and cannot, therefore, earn
any income in India. Its role is limited to collecting
information about possible market opportunities and
providing information about the company and its products
to prospective Indian customers.
Project office
BofAML Country Capabilities
A foreign company planning to execute specific projects in India can set
up temporary project/site offices in India. Such offices cannot undertake
or carry out any activity other than the activity relating and incidental to
execution of the project.
Tax and Regulatory
Corporate tax
Resident companies are taxed on their worldwide income unless exempt by
treaty. Nonresident companies are taxed on Indian-sourced income only.
The rate is 30% for domestic companies and 40% for foreign companies and
branches of foreign companies. Taking into account the surcharge and cess,
the effective rate is 32.445% for domestic companies and 42.024% for
foreign companies.
Withholding tax (non-treaty rates)
Paid to Resident
Paid to Nonresident
Interest
10%
20% (plus surcharge and cess)
Royalty
0%
10%
Dividend
0%
0%
(as of February 2012)
Dividends by domestic companies are not subject to withholding tax.
However, the domestic company paying the dividends is subject to Dividend
Distribution Tax (DDT) of 15%, plus a surcharge of 5% and a cess of 3%.
The effective rate of the DDT is 16.2225%.
Regulatory environment
The regulatory environment is gradually becoming more liberal.
Central bank reporting
Government and central bank reporting have a significant impact on treasury
management activity.
Payments
• Bank draft
• Corporate cheque
•Domestic electronic payment (RTGS NEFT)
• Cross-border payment
• ACH (ECS/NECS credit)
• Tax payment
• Payroll (through NEFT/NECS)
• Commercial card
• Statutory payment
• Payable-at-par (PAP) cheque
• Remote bank draft printing
• Global wholesale banknote
Receipts
• Cheque collection
• Cash collection
• Domestic electronic receipt
• ACH (NECS credit)
• Virtual account
• Cheque warehousing and printing
• Local cheque clearing
• Upcountry cheque clearing
• Global wholesale banknote
Liquidity
• Zero balance fixed amount and
percentage sweeping
• Time deposit
• Overdraft
Trade
• Trade processing
• Export credit
• Import credit
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
• Domestic INR commercial draft
• Import warehousing and payment
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
9
Indonesia
Operating Accounts
Savings account – Not available for corporate
Current account – Non-interest-bearing
Population — 248 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — $1.121 trillion (2011 est.)
Currency — Indonesian Rupiah (IDR)
Languages — Bahasa Indonesia, English
• Resident current account: Available
• Resident savings account: Not available
• Nonresident current account: Available
• Nonresident savings account: Not available
Types of Entities and Incorporation
Central Bank
The most common forms of business setups for foreign
companies are:
Bank Indonesia (BI)
• Domestic subsidiary
• For more information on the BI, visit: www.bi.go.id/web
• Representative office
Clearing Infrastructure
Domestic subsidiary
High value payments
A domestic subsidiary, locally called a limited liability company
or perusahaan terbatas (PT), is established either under foreign
shareholders or through a joint venture with Indonesians or
wholly-owned by Indonesian shareholders and must be approved
by the Ministry of Justice. A limited liability company must
comply with Indonesian law and is considered an Indonesian
company, and the company can subsequently be changed or
sold to the shareholders, foreigners or Indonesians.
• Bank Indonesia Real Time Gross Settlement (BI-RTGS) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Bank Indonesia Clearing System (SKNBI) —
Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Jakarta Branch
Business since: 1968
Branch address: Indonesia Stock Exchange Building,
Tower 2, 23rd floor, Jalan Jenderal Sudirman, Kav. 52-53
Jakarta 12190, Republic of Indonesia
Representative office
In Indonesia, a representative office may not own or maintain
production facilities or operational activities, and therefore
cannot accept orders, participate in tenders, sign contracts or
engage in the importation of goods.
Tel: +62.21.515.8000
Tax and Regulatory
Email: dg.gts_indonesia@baml.com
Corporate tax
Website: www.baml.com/treasurymanagement
Resident companies are taxed a flat 25% on worldwide income,
less tax credit for certain income taxes paid overseas.
Corporations with an annual gross income up to IDR 50 billion
are entitled to a tax discount of 50% of the standard rate on
taxable income derived from the portion of gross income up to
IDR 4.8 billion.
10
Withholding tax
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
15%
20%
Royalty
15%
20%
Dividend
15%
20%
(as of February 2012)
Withholding tax of 15% on residents is not a final tax, while nonresidents
are subject to a non-treaty final withholding tax of 20%.
Regulatory environment
In order to achieve stability in the value of IDR and the financial system in
the country, Bank Indonesia has placed certain restrictions on the currency.
Approval from Bank Indonesia must be obtained before taking IDR 100
million (or its equivalent in a foreign currency) or more out of the country;
any person carrying IDR 100 million (or its equivalent in a foreign currency)
or more into Indonesian Customs territory must verify the authenticity of the
funds with Indonesian customs upon arrival.
Central bank reporting
Bank of America Merrill Lynch will assist our clients in completing the
Central Bank Reporting (CBR) form for either incoming or outgoing transfers
for transactions in foreign currency with value of U.S. $10,000 and greater
or equivalent. Regulatory reporting is also required for all payments
denominated in IDR to or from a nonresident bank account.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
− Cheque deposit (over-the-counter)
− Bill payment collection
• Lockbox
• Wire (domestic and international)
• ACH
• Virtual account
• Global wholesale banknote
Liquidity
• Notional pooling
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
11
Japan
Population — 127.4 million (July 2011 est.)
Gross Domestic Product (purchasing power
parity) — U.S. $4.389 trillion (2011 est.)
Currency — Yen (JPY)
Languages — Japanese
Central Bank
Bank of Japan (BOJ)
• For more information on the BOJ, visit: www.boj.or.jp/en
Clearing Infrastructure
High value payments
• Bank of Japan Financial Network System (BOJ-NET) —
Bank of America Merrill Lynch Direct Member
• The Foreign Exchange Yen Clearing System (FXYCS) —
Bank of America Merrill Lynch Indirect Member
Low value payments
• Zengin – Domestic JPY Wire Payment Clearing System —
Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Branch office
• Representative office
Domestic subsidiary
A foreign company establishing a subsidiary company in Japan
must choose to establish the subsidiary company as a jointstock corporation (Kabushiki-Kaisha, or K.K.), limited liability
company (Godo-Kaisha, or LLC) or similar entity stipulated by
Japan’s corporate law. Both unlimited partnerships (GomeiKaisha) and limited partnerships (Goshi-Kaisha) are granted
corporate status under the corporate law, but they are rarely
chosen in practice because equity participants bear unlimited
rather than limited liability.
Branch office
A branch office does not have its own legal corporate
status. In general, the foreign parent company is ultimately
responsible for all debts and credits generated by the
activities of its Japanese branch office. A Japanese branch
office, however, may open bank accounts and lease real
estate in its own name.
Representative office
A representative office does not require any registration, as it
is prohibited from engaging in business or sales activities.
Bank of America, N.A., Tokyo Branch
Business since: 1947
Branch address: Nibonhashi 1-chome Building, 13th floor,
1-4-1 Nibonhashi, Chuo-ku, Tokyo 100-6115, Japan
Tel: +81.3.6758.5000
Email: dg.gts_japan@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Interest-bearing
Current account – Non-interest-bearing
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
12
Tax and Regulatory
Corporate tax
The effective tax rate is approximately 40.69%, comprising
national corporation tax (30%), local inhabitants and enterprise
tax. This will be reduced to 35.64%, comprising national
corporation tax (25.5%), local inhabitants and enterprise tax
for fiscal years beginning on or after April 1, 2012.
However, 10% special reconstruction corporation tax will be
imposed on the national corporation tax liability for fiscal year
beginning in the period from April 1, 2012, to March 31, 2015.
Therefore, the effective tax rate for the fiscal years will be
38.01%, comprising national corporation tax (28.05%), local
inhabitants and enterprise tax.
Small companies with stated capital of JPY100 million or less
are taxed at 18% on the first JPY 8 million of taxable income,
and 30% on the balance for national corporation tax. As the
above tax reform will be applied to small companies as well,
the 18% will be reduced to 15% for fiscal years beginning on or after
April 1, 2012, and become 16.5% for fiscal year beginning in the period
from April 1, 2012, to March 31, 2015, after 10% special reconstruction
corporation tax is imposed.
Withholding tax (non-treaty and excludes other preferential rates)
Paid to Resident
Paid to Nonresident
0%
20%
Interest (Bond)
Interest (Deposit)
20% (20.315%)*
15% (15.315%)*
Interest (Loan)
0%
20% (20.42%)**
Royalty
0%
20% (20.42%)**
Dividend (Listed)
7% (7.147%)***
7% (7.147%)***
Dividend (Unlisted)
20% (20.42%)**
20% (20.42%)**
*Special reconstruction National income tax will be imposed on National withholding tax at 2.1%
from 2013 to 2037 (15%x1.021% = 15.315%). Additional 5% of Local withholding tax is imposed
to “Paid to Resident.”
**Special reconstruction National income tax will be imposed on National withholding tax at 2.1%
from 2013 to 2037 (20%x1.021% = 20.42%).
***Special reconstruction National income tax will be imposed on National withholding tax at 2.1% in
2013 (7%x1.021% = 7.147%).
• Interest on loans paid to residents and interest on bonds or deposits paid
to resident financial institutions does not attract withholding tax. A lower
rate of 15% is available for interest payments on bonds or deposits to
nonresidents and 0% is also available for certain types of bonds.
• The dividend withholding tax rate on listed shares paid (until December
31, 2013) is 7% with a 10% rate applicable to resident individuals.
Regulatory environment
Restrictions on capital transactions between Japanese residents and
nonresidents as well as controls on foreign payments have generally been
lifted, although filing certain reports with the central bank may be required
after certain transactions.
Central bank reporting
There are few restrictions or reporting requirements for trade settlement.
Transactions in the following categories must be reported ex post facto
monthly to the Bank of Japan (BOJ):
BofAML Country Capabilities
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Commercial card
• Payroll
• Direct debit tax payment
• Direct debit utility payment
• Global wholesale banknote
Receipts
• Cheque/draft deposit
• Wire (domestic and international)
• ACH
• Virtual account
• Global wholesale banknote
Liquidity
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
• NEXI capability
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
• All non-trade-related transfers between resident and nonresident bank
accounts with a value equal to or above JPY 30 million (or its foreign
currency equivalent).
• All capital transactions (i.e., loans, credits) between resident and
nonresident bank accounts with a value equal to or above JPY 100
million. Nonresidents may be subject to other reporting requirements
if capital transactions exceed JPY 100 million.
13
Korea
Population — 48.86 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $1.549 trillion
(2011 est.)
Currency — Korean Won (KRW)
Languages — Korean
Central Bank
Bank of Korea (BOK)
• For more information on the BOK, visit: eng.bok.or.kr
Clearing Infrastructure
High value payments
• The Bank of Korea Financial Wire Network (BOK-Wire+) —
Bank of America Merrill Lynch Direct Member
• Interbank Funds Transfer System (IFT) —
Bank of America Merrill Lynch Direct Member
• Interbank Home/Firm Banking Network (HOFINET) —
Bank of America Merrill Lynch Direct Member
Low value payments
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Branch office
• Representative office
Domestic subsidiary
A subsidiary of a foreign company is established as a local
company. A subsidiary is a separate corporation from the
foreign company and is eligible to receive tax incentives
provided by the Special Tax Treatment Law (STTCL) in
calculation of corporate income tax, if the subsidiary
meets the requirements pertaining to the STTCL.
Branch office
A foreign company may establish a branch office to conduct
business in Korea. A branch office does not have its own legal
corporate status. In general, the foreign parent company is
ultimately responsible for all debts and credits generated by
the activities of its branch office.
Representative office
A representative office is established as a branch office
with only marketing and support operations. No direct sales
can be conducted. This is the simplest form of conducting
business in Korea.
• GIRO — Bank of America Merrill Lynch Direct Member
• Cash Management System (CMS)
Bank of America Merrill Lynch Presence
Bank of America, N.A., Seoul Branch
Business since: 1967
Branch address: 27th Floor, Seoul Finance Center
136 Sejongdae-Ro, Jung-Ku
C.P.O. Box 3026 Seoul, 100-768 South Korea
Tel: +82.2788.1400
Email: dg.gts_korea@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Interest-bearing
Current account – Non-interest-bearing
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
14
Tax and Regulatory
Corporate tax
Resident companies are taxed on worldwide income at a rate
of 10% for the first KRW 200 million 20% for the tax base
between KRW200 million and KRW20 billion, and 22% for
tax base exceeding KRW20 billion. A 10% inhabitant’s tax is
imposed on tax liability, i.e., 10% of 22% corporate income tax,
resulting in 2.2%. Taking into account the inhabitant’s tax, the
effective rate is 24.2%. Nonresident companies are taxed at
the rate of 2% to 20% (2.2% to 22% including the inhabitant’s
tax) for Korean-sourced income.
Withholding tax (non-treaty rates)
Paid to Resident
BofAML Country Capabilities
Paid to Nonresident
Interest
14%
22%
Royalty
0%
22%
Dividend
0%
22%
(as of February 2012)
Withholding rates outlined here refer only to corporate residents and
nonresidents. Withholding rates on residents are not a final tax but an
advance payment.
Regulatory environment
Strict foreign exchange control restricts the capital movement of funds out
of Korea. Subject to foreign exchange regulations, a Korean entity is allowed
to borrow funds from a company located outside of Korea with acceptance of
declaration by the designated FX bank. However, if the aggregated amounts
of such funds for the past one year exceed $30 million, acceptance of
declaration by the Ministry of Strategy and Finance (MOSF) is required prior
to the transaction.
Central bank reporting
Central bank and other government reporting requirements have a
substantial impact on treasury management activity, but the regulatory
environment is liberalizing.
Payments
• Bank draft
• Corporate cheque
• Wire (domestic and international)
• GIRO payment
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
− Cheque deposit (over-the-counter)
− Electronic fund transfer receipt
• Cheque/draft deposit
• Wire (domestic and international)
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
• Korea multibank sweeping
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• K-exim/K-sure
15
Malaysia
Population — 29.2 million (July 2012 est.)
Gross Domestic Product — U.S. $447 billion
(2011 est.)
Currency — Malaysian Ringgit (MYR)
Languages — Bahasa Melayu, English, Chinese
Central Bank
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Branch office
• Representative office
Domestic subsidiary
By far the most preferred corporate entity for foreign investors
is the limited liability company (known locally as a Sendirian
Berhad company). A limited company is a subsidiary of and a
separate corporate entity from the foreign parent company.
Bank Negara Malaysia (BNM)
• For more information on the BNM, visit: www.bnm.gov.my
Clearing Infrastructure
High value payments
• Real Time Electronic Transfer of Funds and Securities
(RENTAS) — Bank of America Merrill Lynch Direct Member
Low value payments
• MEPS Interbank Giro (MEPS IBG) —
Bank of America Merrill Lynch Direct Member
• Financial Process Exchange (FPX) —
Bank of America Merrill Lynch Direct Member
Branch office
A branch office retains the legal identities of its foreign parent
company and adopts the same name as its parent. This entity
is taxed as a limited liability company in Malaysia. A branch
office requires a Malaysia-resident individual to act as the
sponsoring agent.
Representative office
Due to restrictions on activities placed on a representative
office, this entity is the least preferred option for a Malaysia
business setup. A representative office is useful only to
business people wishing to conduct preliminary market surveys
and feasibility studies before making a long-term investment in
and commitment to Malaysia.
Bank of America Merrill Lynch Presence
Bank of America Malaysia Berhad
Bank of America, N.A., Labuan Branch
Business since: 1959
Branch address: Level 18, Wisma Goldhill, 67 Jalan Raja
Chulan, 50200 Kuala Lumpur, Malaysia
Tel: +60.3.2032.1133
Email: dg.gts_malaysia@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Not available for corporations
Current account – Non-interest-bearing (except foreign
currency)
• Resident current account: Available
• Resident savings account: Not available
• Nonresident current account: Available
• Nonresident savings account: Not available
16
Tax and Regulatory
Corporate tax
Resident and nonresident companies are taxed on Malaysiansourced income. The current corporate tax rate is 25%, while
a preferential rate of 20% applies to the first MYR 500,000
chargeable income of small-and-medium-enterprises (SMEs)
with a paid-up capital of MYR 2.5 million or less.
Withholding tax (non-treaty rates)
Paid to Resident
BofAML Country Capabilities
Paid to Nonresident
Interest
0%
15%
Royalty
0%
10%
Dividend
0%
0%
(as of February 2012)
Regulatory environment
Malaysia maintains a liberal system of exchange controls. Repatriation
of capital, profits, dividends, royalties, rents and commissions is
freely permitted.
Central bank reporting
Reporting is required for all fund transfers of more than MYR 2,000,000
between residents and nonresidents.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Cash deposit (over-the-counter)
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
• Notional pooling
• Autoplacement
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
17
New Zealand
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
Population — 4.3 million (July 2012 est.)
Gross Domestic Product (purchasing power
parity) — U.S. $123.3 billion (2011 est.)
Currency — New Zealand Dollar (NZD)
Languages — English, Maori
• Domestic subsidiary
Central Bank
Branch office
Reserve Bank of New Zealand (RBNZ)
A branch does not have limited liability in respect of its New
Zealand operations because it does not have a separate legal
identity from the foreign parent company.
• For more information on the RBNZ, visit: www.rbnz.govt.nz
Clearing Infrastructure
High value payments
• Branch office
Domestic subsidiary
A subsidiary is a separate legal identity from the foreign
parent company and has limited liability in respect of its
New Zealand operations.
Tax and Regulatory
• Exchange Settlement Account System (ESAS)
Corporate tax
Low value payments
Resident companies are taxed on worldwide income, and
nonresident companies are taxed only on New Zealand-sourced
income. The corporate income tax rate is 30%.
• NZClear
Bank of America Merrill Lynch Presence
Withholding tax
Our fully integrated preferred bank in New Zealand is ASB
Bank. Visit www.asb.co.nz
Email: dg.gts_newzealand@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Interest-bearing
Current account – Interest-bearing and non-interest-bearing
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
Paid to Resident
Paid to Nonresident
Interest
0%
15%
Royalty
0%
15%
Dividend
0%
30%
(as of February 2012)
Interest: Interest paid to a nonresident is subject to a 15%
Nonresident Withholding Tax (NRWT), which may be subject to
further reduction under an applicable tax treaty. New Zealand
also has an Approved Issuer Levy (AIL) regime that allows
an approved issuer to pay a 2% levy instead of NRWT on
registered securities where the parties are not associated.
Royalty: Royalties paid to a nonresident are subject to a 15%
NRWT, which may be subject to further reduction under an
applicable tax treaty.
Dividend: Dividends paid to a nonresident are subject to a 30%
NRWT to the extent not fully imputed. Fully-imputed dividends
are subject to a 15% NRWT rate. A withholding tax exemption
for imputed non-portfolio dividends applies as of 1 February
2010. Rates may be subject to further reduction under an
applicable tax treaty.
18
Regulatory environment
The regulatory environment is generally open.
Central bank reporting
Central bank reporting requirements have minimal impact on cash
management activity and the regulatory environment is open. Some
minimum regulations/requirements are relevant to nonresidents with
regard to tax and money laundering.
BofAML Country Capabilities
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Cash deposit (over-the-counter)
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Offset arrangement
• Zero balance sweeping
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Risk distribution
• Supply chain finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
19
Philippines
Operating Accounts
Savings account – Interest-bearing
Current account – Interest-bearing
Population — 103.8 million (July 2012 est.)
Gross Domestic Product (purchasing power
parity) — U.S. $389.8 billion (2011 est.)
Currency — Philippine Peso (PHP)
Languages — Filipino, English
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
Types of Entities and Incorporation
Central Bank
The most common forms of business setups for foreign
companies are:
Bangko Sentral ng Pilipinas (BSP)
• Domestic subsidiary
• For more information on the BSP, visit: www.bsp.gov.ph
• Branch office
Clearing Infrastructure
High value payments
• Philippine Domestic Dollar Transfer System (PDDTS) —
Bank of America Merrill Lynch Direct Member
• Philippine Payment System (PPS) —
Bank of America Merrill Lynch Direct Member
• Representative office
• Offshore Banking Unit — (Offshore Banking Unit” or “OBU”
shall refer to a branch a foreign banking corporation which is
duly authorized by the BSP to transact offshore.)
Domestic subsidiary
• Electronic Peso Clearing and Settlement (EPCS) —
Bank of America Merrill Lynch Direct Member
A domestic subsidiary in the Philippines is a juridical person
established under the Corporation Code and regulated by the
Securities and Exchange Commission, separated and distinct
from that of its stockholders. The liability of the shareholders of
a corporation is limited to the amount of their share of capital.
Bank of America Merrill Lynch Presence
Branch office
Bank of America, N.A., Manila Branch
A branch office is a foreign corporation organized under
foreign laws that carries out business activities of the
foreign parent company.
Low value payments
Business since: 1947
Branch address: 27th floor, Philamlife Tower, 8767 Paseo de
Roxas, Makita City, Metro Manila, Philippines 1257
Tel: +63.2.815.5000
Email: dg.gts_philippines@baml.com
Website: www.baml.com/treasurymanagement
Representative office
A representative office is a foreign corporation organized under
foreign laws. It does not derive income and is fully subsidized
by the foreign parent company. The representative office
deals directly with clients of the foreign parent company as it
undertakes such activities as information dissemination, acts
as a communication center and promotes company products.
Tax and Regulatory
Corporate tax
Philippine corporations are taxed on worldwide income;
nonresident companies are taxed only on Philippine-sourced
income. A foreign corporation with a branch in the Philippines
is taxed on Philippine-sourced income.
The domestic corporate tax rate for all categories of
corporations is 30%. Regional operating headquarters are
taxed at 10% on taxable income.
20
Withholding tax (non-treaty rates)
Paid to Resident
BofAML Country Capabilities
Paid to Nonresident
Interest
20%
30%
Royalty
20%
30%
0%
15%*
Dividend
(as of February 2012)
*Provided the other country of the payee grants a tax credit of 15%.
Regulatory environment
Central bank currency intervention is limited to what is necessary to meet
program targets for net international reserves and maintain orderly market
conditions. This strict regulation of the Philippine peso limits its use in global
treasury activities, making the USD, the euro or the yen a more effective
currency tool.
Central bank reporting
There are few restrictions or reporting requirements for foreign exchange.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Tax payments
• Payroll
• Commercial card
• Government payments
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
− Cheque deposit (over-the-counter)
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Virtual account
• Global wholesale banknote
Liquidity
• Zero balance sweeping
• Interest optimization
• Time deposit
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Structured trade finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
21
Singapore
Operating Accounts
Savings account – Not available for corporate
Current account – Interest-bearing
Population — 5.35 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $314.2 billion
(2011 est.)
Currency — Singapore Dollar (SGD)
Languages — English, Mandarin
Central Bank
Monetary Authority of Singapore (MAS)
• For more information on MAS, visit:
www.mas.gov.sg/about_us/Introduction_to_MAS.html
• Resident current account: Available
• Resident savings account: Not available
• Nonresident current account: Available
• Nonresident savings account: Not available
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
• Domestic subsidiary
• Branch office
• Representative office
Domestic subsidiary
Clearing Infrastructure
High value payments
• MAS Electronic Payment System (MEPS+) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Interbank GIRO System (IBG) —
Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Singapore Branch
This is the most widely used option for foreign company
registration in Singapore. A Singapore subsidiary company is
a separate legal entity altogether. Generally, the Singapore
government permits 100% ownership of the Singapore
subsidiary company by the foreign parent company.
Branch office
A Singapore branch of a foreign company is not a separate
legal entity, as it is considered to be merely an extension of a
company incorporated outside Singapore. Its liabilities may be
enforced against all the assets of the foreign company.
Business since: 1955
Representative office
Branch address: 50 Collyer Quay, #15-01
OUE Bayfront, Singapore 049321
A representative office of a foreign company in Singapore can
only be used for promotional activities and it cannot enter
into any business transactions either in its own capacity or
on behalf of the foreign parent company. A representative
office in Singapore has no legal status, but is merely an
administrative arrangement.
Tel: +65.6239.3888
Email: dg.gts_singapore@baml.com
Website: www.baml.com/treasurymanagement
Tax and Regulatory
Corporate tax
Both local and foreign companies (nonincentive) are taxed
at a normal corporate tax rate of 17% on chargeable income.
However, 75% of the first SGD 10,000 of chargeable income
and 50% of the next SGD 290,000 of chargeable income
are exempt.
22
Withholding tax (non-treaty rates)
Paid to Resident
BofAML Country Capabilities
Paid to Nonresident
Interest
0%
15%
Royalty
0%
10%
Dividend
0%
0%
(as of February 2012)
Regulatory environment
Singapore’s regulatory environment is among the least restrictive in the
world and is complemented by a similarly competitive tax environment.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
Central bank reporting
The Monetary Authority of Singapore (MAS) imposes no formal central bank
reporting requirements for corporations.
• Cash deposit (over-the-counter)
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Notional pooling
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Risk distribution
• Supply chain finance
• Structured trade finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
• Escrow agent
23
Taiwan
Operating Accounts
Savings account – Interest-bearing
Current account – Non-interest-bearing
Population — 23.1 million (July 2012 est.)
Gross Domestic Product (purchasing power
parity) — U.S. $885.3 billion (2011 est.)
Currency — New Taiwan Dollar (NTD)
Languages — Mandarin, Taiwanese
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Not available
• Nonresident savings account: Available
Types of Entities and Incorporation
Central Bank
The most common forms of business setups for foreign
companies are:
The Central Bank of the Republic of China (Taiwan) (CBC)
• Domestic subsidiary
• For more information on the CBC, visit:
www.cbc.gov.tw/mp2.html
• Branch office
Clearing Infrastructure
Domestic subsidiary
High value payments
A company limited by shares is the most common form
of business undertaken for foreign investors in Taiwan.
A subsidiary in the form of a limited company is a separate
corporation from the foreign parent company.
• FISC Interbank Remittance System (IBRS) —
Bank of America Merrill Lynch Direct Member
Low value payments
• Automated Clearing House (ACH) —
Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Bank of America, N.A., Taipei Branch
Business since: 1964
Branch address: 48th floor, Taipei 101 Tower, No. 7,
Xin Yi Road, Section 5, Taipei 11049, Taiwan
Tel: +886.2.8101.1288
Email: dg.gts_taiwan@baml.com
Website: www.baml.com/treasurymanagement
• Representative office
Branch office
A foreign company may establish a branch office to conduct
business in Taiwan. A branch office does not have its own legal
corporate status. In general, the foreign parent company is
ultimately responsible for all debts and credits generated by
the activities of its branch office.
Representative office
A representative office of a foreign company in Taiwan can only
be used for promotional activities and it cannot enter into any
business transactions either in its own capacity or on behalf of
the foreign parent company.
Tax and Regulatory
Corporate tax
The corporate income tax rate is 17%, and a 10% surtax is
imposed on undistributed profits. Taiwan companies with a
head office in Taiwan are subject to income tax on worldwide
income. A foreign tax credit is available for income tax paid
in other countries on income derived outside Taiwan. Taiwan
companies with a head office outside Taiwan are subject to
income tax only on Taiwan-sourced income.
24
Withholding tax (non-treaty rates)
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
10%
15%**/20%
Royalty
10%*
20%
0%
20%
Dividend
(as of February 2012)
*If Government Uniform invoices are issued by royalty receivers, the withholding tax can be waived.
**15% withholding tax applies to interest income derived from short-term bills, securitised
certificates, corporate bonds, government bonds or financial debentures, as well as interest
arising from repurchase agreements. The rate in all other cases is 20%.
Regulatory environment
Taiwan has substantially liberalized foreign exchange controls, and all foreign
exchange transactions are administered by the CBC. A limit of USD 50 million
is imposed on inward and outward remittances converted into or out of NTD
for any single corporate entity.
Central bank reporting
Foreign nationals without an alien resident certificate and overseas entities
not registered as businesses in Taiwan are allowed to convert between
TWD and foreign currencies but are subject to a limit of USD 100,000 or
equivalent per transaction.
All conversions of foreign currencies into TWD or vice versa are subject
to CBC reporting and declaration requirements. FX conversions of TWD
500,000 or more must be reported to the CBC.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Cash deposit (over-the-counter)
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Post office cash deposit
• ATM collection
• Convenience store bill payment
• Global wholesale banknote
Liquidity
• Notional pooling
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Risk distribution
• Supply chain finance
• Electronic trade platform
25
Thailand
Types of Entities and Incorporation
The most common forms of business setups for foreign
companies are:
Population — 67.09 million (July 2012 est.)
Gross Domestic Product (purchasing
power parity) — U.S. $601.4 billion
(2011 est.)
Currency — Thai Baht (THB)
Languages — Thai, English
• Domestic subsidiary
Central Bank
Branch office
Bank of Thailand (BOT)
A corporation duly registered abroad may set up a Thai branch
office to engage in business activity in Thailand. A Thai branch
office is treated as the same legal entity as its foreign parent
company. All acts of either entity are legally viewed as the acts
of the other entity.
• For more information on the BOT, visit:
www.bot.or.th/English/Pages/BOTDefault.aspx
Clearing Infrastructure
• Branch office
• Representative office
Domestic subsidiary
A subsidiary is essentially a private limited company
incorporated in Thailand. There can be no more than
49% of foreign ownership in a private limited company.
High value payments
Representative office
• Bank of Thailand Automated High Value Transfer Network
(BAHTNET) — Bank of America Merrill Lynch Direct Member
A foreign company (i.e., a company not formed under the laws
of Thailand and/or not more than 50% owned by a Thai national)
may set up a representative office in Thailand. A representative
office in Thailand is considered a liaison office and may not
engage in any profit-seeking or profit-making activities.
Low value payments
• System for Managing Automated Retail Funds Transfer
(SMART) — Bank of America Merrill Lynch Direct Member
Bank of America Merrill Lynch Presence
Tax and Regulatory
Bank of America, N.A., Bangkok Branch
Corporate tax
Business since: 1949
Thailand taxes resident companies on a worldwide income
basis (profits derived from both domestic and foreign sources).
Nonresident companies are taxed only on Thailand-sourced
income. The corporate tax (CIT) rate for corporations is 23%
for accounting period beginning on or after January 1, 2012
and to 20% for the next two accounting periods beginning on
or after January 1, 2013. After that, the CIT rate goes back
to 30%. In addition, if the after-tax profits are repatriated to
the head office, there is a final withholding tax at 10%. For
small-and-medium-enterprises (SMEs) with paid-up capital not
exceeding THB 5 million and annual revenue not exceeding THB
30 million, CIT is paid at progressive rates ranging from 0% to
23% for accounting periods beginning or after January 1, 2012.
The rate will be reduced to 0% to 20% for accounting periods
beginning on or after 2013.
Branch address: All Seasons Place, CRC Tower 33rd floor,
87/2 Wireless Road, Pathumwan, Bangkok 10330, Thailand
Tel: +66.2.305.2900
Email: dg.gts_thailand@baml.com
Website: www.baml.com/treasurymanagement
Operating Accounts
Savings account – Interest-bearing
Current account – Non-interest-bearing
• Resident current account: Available
• Resident savings account: Available
• Nonresident current account: Available
• Nonresident savings account: Available
26
Withholding tax (non-treaty rates)
BofAML Country Capabilities
Paid to Resident
Paid to Nonresident
Interest
1%
15%
Royalty
3%
15%
Dividend
10%
10%
(as of February 2011)
Regulatory environment
Most remittances can be made through a commercial bank, and
documentation evidencing the purpose of the remittance may be
required. The Bank of Thailand must approve the remittance of funds
exceeding the ceiling amount.
Central bank reporting
The Bank of Thailand (BOT) administers the Exchange Control Act.
Customers and their bankers have an obligation to report the details and
the purpose of many payments — for example, all movements in and out
of nonresident accounts. Residents must submit exchange control forms
accompanied by documentation substantiating the transaction.
Payments
• Bank draft
• Corporate cheque
• RTGS (domestic and international)
• ACH
• Direct debit payment
• Tax payment
• Payroll
• Commercial card
• Global wholesale banknote
Receipts
• Branch collection points
− Cash deposit (over-the-counter)
− Cheque deposit (over-the-counter)
− Bill payments collection
• Cheque/draft deposit
• Lockbox
• Wire (domestic and international)
• ACH
• Direct debit collection
• Virtual account
• Global wholesale banknote
Liquidity
• Zero balance sweeping
• Interest optimization
• Time deposit
• Overdraft
Trade
• Trade processing
• Open account finance
• Commercial L/C (export and import)
• Standby L/C and guarantee
• Supply chain finance
• Electronic trade platform
Global Custody and Agency Services
• Custody
• Issuing and Paying Agent (IPA)
27
The Banker, 2011
Most valuable banking brand globally
Treasury & Risk
#1 Principal Bank, Cash Management,
International (3rd consecutive year)
The Asset Triple A Awards 2011
Bank of America Merrill Lynch
named Rising Star Cash
Management Bank for the
Asia region
The Asset Triple A Awards 2012
• Best MNC/Large Corporate Bank,
Australia
• Best FI Bank, Australia
• Best FI Bank, India
• Best FI Bank, Taiwan
• Best NBFI Bank
Note:
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