Amended tenancy regime comes into force

As you might recall from our previous article back in October 2017, the Macau SAR Legislative Assembly approved on 21 August 2017 the amendment of the tenancy regime provided in the Macau SAR Civil Code, setting it to come into force within 180 days after its publication in the Macau Official Gazette. In other words, the new tenancy regime will come into effect on 21 February 2018.

The said legislation altered articles 1015, 1032 and 1038 of the Macau Civil Code and established an Arbitration Center for Tenancy Disputes. In this last regard, it should be noted that the implementation of the said arbitration center is referred to the Chief Executive, which has yet to issue any ordinance in that regard. In any case, the law hints that the arbitration will be voluntary and thus the parties will still be able to resort to the courts directly.

As we previously stated, the major changes to the tenancy regime concern, on the one hand, the need for the parties’ signatures on the tenancy agreement to be notarized and, on the other hand, that the unilateral termination by the landlord (without cause attributable to the tenant) can only be effected after a three-year tenancy term.

Accordingly, landlords might consider including additional safeguards in the tenancy agreements to alleviate the said restrictive provisions that were imposed with the new law, while tenants should be aware of the additional protection granted with the amendments to the regime.

As usual, we remain fully available to provide any clarification as deemed necessary.
We also take the opportunity to inform that during the Chinese New Year, we will be closing slightly earlier on the 15th of February and closed all day during the 16th and 19th.

Until next time!

Macau, 28 January 2018

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* Sai Van Lake – recorded by a hobbyist photographer lawyer of the office

Animal Protection Law

Here at Manuela Antonio – Lawyers and Notaries, aside from our utmost commitment to our clients, we care deeply for the Macau SAR community with whom we have an established connection which dates back to over three decades. In fact, we have not only seen the ups and downs of the community but also celebrated its victories whilst sharing the not so cheerful moments that it had to endure.

Although scarcely in the past, animal welfare is an ever-increasing concern of our citizens. In fact, a new wave of trendy global concerns of this nature has seemingly sensitized the general public. The past recent years have brought to light a few animal-friendly institutions such as ANIMA (2003) and the Macau Animal Rescue Association (2009), seeking to turn the region into a role model community in terms of awareness and prevention of neglectfulness and cruelty to animals. And unavoidably reaching the governmental entities as well. Under the authority of the Civic and Municipal Affairs Bureau (“IACM”), the subunit “Division of Animal Control and Inspection” was created in 2002, seeking to safeguard the public health, preventing the spread and outbreak of animal-borne diseases, and raising the public’s awareness of their civic responsibilities in raising pets.

Moreover, the trend also developed a sense of growing awareness in the local legislator, having meanwhile created important general regulations tackling the matter such as the Administrative Regulation no. 28/2004 – regarding the Approval of the General Regulations Governing Public Places. The law sets requirements in terms of cleanliness, personal hygiene and public health and protecting natural environment as well as the balance of a variety of habitats, including that of domestic pets. Also, the said regulation was followed by two executive orders stating a list of contraventions and other relevant additional provisions – Chief Executive Orders no. 106/2005 and 432/2005).

While the said regulations did not address specifically the issue of animal protection, it somewhat paved the way for Law no. 4/2016, also known as the Animal Protection Law. This legislative piece, which was published in the Macau Official Gazette on July 25 and came into force on September 1st, 2016, among other provisions, prohibits and punishes cruelty and violence towards animals, especially actions that may subject the same to pain and suffering.

Accordingly, animal owners are in general prohibited from abandoning their pets and must provide food, drinking water, sufficient space for free movement, proper living conditions, and necessary preventive and medical care to animals. One of the most controversial issues that arose during the legislative debates on the law was the mandatory requirement of muzzles in public areas (including public spaces in buildings) for dogs that weigh 23 kilograms or more, or those considered dangerous by the IACM (in alternative to a muzzle, it is possible to opt for a cone collar). It should be noted, however, that dog owners may apply for a license to exempt certain dogs from such requirement.

In addition, dogs must be leashed or put in carriers when in public areas. Also, all dogs living in construction sites and junkyards must be neutered and owners or the people responsible for those sites must cooperate with government authorities when the latter perform their relevant duties in that regard. The law further enlists which animals are not allowed to be used for human consumption and expressly provides for a prohibition of the instigation of animals to fight. Animal usage for scientific research is also an important aspect regulated by the Animal Protection Law, as well as the mandatory registration of animals used in competitions.

In terms of liability, perpetrators may face criminal charges, punishable by a one-year term of imprisonment, as well as administrative sanctions of up to MOP100,000 in fines and other additional penalties such as depriving the owner of the animal’s care, the prohibition on the acquisition or breeding of animals for a period of up to 2 years, the disqualification from the practice of commercial activities linked to any kind of animals for a period up to 2 years, and the temporary closure of a given shop or business for a period between 1 month and 1 year.

Subsequently and following the enactment of the Animal Protection Law, other animal-friendly legislation has been approved: Chief Executive’s Notice no. 355/2016, regarding the prohibition of obtaining, raising, breeding or importing animals of specific species and Law no. 2/2017, which seeks to enforce in the Macau SAR the Convention on International Trade in Endangered Species of Wild Fauna and Flora.

As concerned citizens and seeking to fulfill our referred commitment as members of this great community, our office is proud to have recently made a donation to ANIMA – we had the honor of having been received by the organization’s President and delivered the cheque personally.

Until next time!

Macau, 28 December 2017

Manuela António Lawyers and Notaries turns 31

Today, 28 of November, is a very special day for our law firm as we turn 31!

Given another successful year and due to our Corporate Social Responsibility policies, we decided this year to make a donation to the Society for the Protection of Animals (Anima) in order to help man’s best friends!

We also take this opportunity to send a special thanks to Anima and to Dr. Albano Martins for receiving us and for all of the excellent work being done!

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Law no. 13/2017 – Amendment of the Macau Civil Code tenancy regime

One of the consequences of the astounding growth of the Macau Special Administrative Region of the People’s Republic of China after the end of the gaming monopoly has been the asset value increase in the real estate market. In this overnight success that transformed what was formerly a fisherman’s bay into the largest gross income casino industry in the world, the Macau SAR also achieves the feat of having the most densely populated city in the world – more than 20,000 people per square kilometer.

It is said that the real estate market in the Macau SAR is and has been for the past decade slightly unbalanced in the sense that there is excessive demand for a reduced supply, having led to the referred increase of the transaction prices and, consequently, in the rents charged. As a result, the legislator even considered, based on the demands of a group of citizens, implementing a rent control mechanism, later dropped as it would constitute an excessive intervention of the Government in the rental private market.

Taking into account the herculean challenge of establishing an equilibrium between keeping the Government away from intervening in the market (a cornerstone of the Macau SAR economy), and ensuring a minimum level of protection to the lessee (deemed the weaker party in a lease relationship), the Macau SAR Legislative Assembly amended a few provisions of the Civil Code tenency regime, as per the new bill promulgated on 21 August 2017 and which will come into force within 180 days after its publication in the Macau Official Gazette, meaning 21 February 2018:

(i) the execution of the tenancy agreements should be subject to notarization (meaning the signatures therein must be certified by a Macau SAR notary, (ii) the period during which the landlord cannot exercise the right to prevent the renewal of the lease agreement is extended from two years to three years, (iii) the landlord is allowed to proceed directly to enforcement proceedings in case the signatures of the parties in a tenancy termination agreement were notarized; and (iv) an Arbitration Center is established to resolve tenancy disputes (which mode of operation and structure will be detailed in a dispatch from the Macau SAR Chief Executive).

As always, given our long experience in real estate transactions and lease agreements, our team remains ready and willing to advise in any specific matter in this regard.

Macau, 28 October 2017

Law no. 12/2017 – Condominium management services

It became clear, after the massive building construction which strongly influenced the economy in the Macau Special Administrative Region of the People’s Republic of China during the past few decades, that the regulations governing condominium management had to be reviewed to meet the specific issues arising in the Macau SAR from the elevated concentration of condominiums, from the complexity of the inherent ownership relations and to maintain or increase the standards of the provision of condominium management services.

In the Macau SAR, condominium management services tend normally to be provided by the so-called developers (meaning the entities that construct the buildings) or arranged by the unit owners themselves, and thus the law should seek to improve such services and to ensure that the entities providing the same are subject to proper supervision.

In a government-initiated bill, and after a great deal of effort from the Macau SAR Legislative Assembly, the latter approved a diploma regulating the condominium management services, which was promulgated in the Macau SAR Official Gazette on the 21 August 2017 and is slated to come into effect exactly one year after.

In a nutshell, the legislation focuses on (i) regulating the access and provision of condominium management services in the Macau SAR, (ii) improving the overall management of the common areas of the condominiums, and (iii) tackling the condominium management-related disputes between the condominium management committees and condominium management companies.

The major aspect of this new law is evidently the fact that the provision of condominium management services now becomes subject to licensing by the Housing Bureau, which is valid for a period of 3 years and cannot be transferred to another entity. Among the requirements to obtain a license, the company must have its registered address in the Macau SAR, its business scope must include condominium management services, its registered capital must be a minimum of MOP 250,000, at least one specialized manager, the directors must be in good standing and the entity proposing to conduct such business cannot have any debts to the Macau SAR Treasury.

Moreover, in order to provide condominium management services, the entity must effect a deposit with the Macau SAR Government as well as comply with several obligations in the provision of such services (such as preparing the annual accounts of the previous year and the budget for the upcoming one).

Finally, licensed entities are obliged to notify the Housing Bureau within 30 days of the occurrence of the situations provided in the law, such as the commencement of bankruptcy proceedings or the change of the firm, registered office or directorship. Evidently, non-compliance with the said obligations can subject the entities to fines, suspension of the license or even its revocation and most notably to criminal liability (which, in some circumstances, can be imputable to the directors and others that exercise de facto senior management positions although not formally appointed as such).

Considering its practical and wide application, we recommend a careful analysis of the implications of the new law. Moreover, our dedicated team of property practitioners shall be glad to assist in any enquiries concerning this very important matter.

Law no. 7/2017 – the non-mandatory central provident fund

Macau’s latest provident fund scheme for the private sector

Seeking to strengthen the social security scheme in the Macau SAR and its existing provident fund scheme, the Social Security Fund (SSF) ran a detailed study and a public inquiry on the peoples’ thoughts and remarks regarding the creation of a central provident fund. Thereafter, the Macau SAR Government submitted a proposal to the Legislative Assembly for the implementation of the said new central provident fund scheme, based on the modus operandi of the private pensions’ schemes.

The law was subsequently approved with the clear objective of ensuring a sustainable retirement plan for the Macau residents, based on the contributions of both employers and employees (or individuals if that is the case), as well as from the Macau SAR Government. In this regard, it is worth noting that given its non-mandatory nature, the law includes incentives to the employer such as tax benefits.

Simply put, the new law, published in the Macau Official Gazette on the 19 June 2017, defines the participation in a non-mandatory central provident fund scheme, providing that the access to the same can either derive from an agreement between the employer and its respective employee or through a voluntary individual application.

Within this legal framework there are two main functioning schemes: (a) the contributive regime, implemented through voluntary participation under provident fund plans, and (b) the distributive regime, which is implemented through transfer of funds from the Macau SAR’s public purse to its residents.
As specified in the law, the main purposes of the non-mandatory central provident fund scheme are (i) the reinforcement of the social protection of the Macau SAR residents in old age, and (ii) complementing the existing social security scheme.

It is stated that the SFF will be the entity responsible for executing the law, namely establishing and supervising the non-mandatory central provident fund, namely ensuring the automatic opening of individual accounts for every Macau resident over 18 years old (although it can also include younger residents if the same are enrolled on the Social Security scheme), which is composed by three subaccounts: government contributions, general contributions and maintenance.

In respect to the individual account holders of the non-mandatory central provident fund scheme, the law states that they can only access the funds when reaching 65 years of age or prior if under certain circumstances such as serious illness or when faced with substantial medical expenses. The scheme is considerably flexible in the sense that it is not susceptible of being canceled merely on the grounds of the termination of the employment.

Meanwhile, the government contributions subaccount is managed by the SFF, whereas the general contributions and maintenance subaccounts are managed by the management entities of the respective pension funds from which they originate from.

To ensure proper and adequate enforcement of the provisions, the law also encompasses a sanctions framework, including administrative sanctions, but also criminal liability in the more serious cases.

The new law comes into force on 1 January 2018.

As usual, we are fully available to elaborate on the particular features of the law, namely the advantages and obligations for the employers when applying for this non-mandatory central provident fund scheme. In our humble opinion, it is an option worth considering.

New law restricts the consumption and forbids the sale of electronic cigarettes in Macau

The recently published Law no. 9/2017 (published in the Macau Official Gazette on the 24th of July, 2017) made some changes to the regulation for the tobacco prevention and control, approved by Law no. 5/2011.

This original legislation came to force in the beginning of 2012, implementing in the Macau Special Administrative Region of the People’s Republic of China the obligations assumed under the World Health Organization Framework Convention on Tobacco Control, the first global public health treaty.

The scope of the prohibitions previously aimed at the consumption of cigarettes is now extended to electronic cigarettes (defined as any product that is used to inhale vapor with or without nicotine), meaning smoking using such devices is now forbidden in workplaces, hotels, bars, casinos, shopping malls, public transportation and parks, among others.

It should be noted that while the use of electronic cigarettes outside the designated areas is not forbidden, its commercialization is not allowed in Macau. The sales ban addresses specific recommendations more recently issued by the World Health Organization, urging governments to ban the use of electronic cigarettes in public places and to forbid its sale.

The new law also revised some other aspects of Law 5/2011, including the provision that entities can now forbid smoking in open spaces which are managed by the same. Also, the fines applicable to people caught smoking in unauthorized areas were raised to MOP$1,500.00 (up from the previous MOP$400.00). Practically all the other fines for breaches of the regulation’s norms have also increased, having doubled in the process.

In the meantime, new guidelines for the creation of smoking rooms inside casinos will likely be announced soon by the Secretary for Social Affairs and Culture, to be complied with by gaming concessionaires before the end of 2018.

The new law comes into force on the 1st of January, 2018.

Law 6/2017

Published on June 12, Law 6/2017 – the “Law for the control of cross-border transportation of cash and bearer negotiable instruments” – foresees a new set of regulations for the transportation of cash and bearer instruments between Macau and the exterior.

The said law follows Recommendation 32 of the Asia Pacific Group on Money Laundering – an international organization committed to the prevention of money laundering and the financing of terrorism – and requires countries to have measures in place to detect the physical cross-border transportation of currency and bearer negotiable instruments, including the implementation of a declaration or disclosure systems.

Under the said law, any individual entering the Macau Special Administrative Region (the “Macau SARS”) will have to declare to Macau Customs on arrival any cash amount and/or bearer negotiable instruments being carried which surpass the reference amount, which is still to be determined although expected to be around MOP 120,000.00 (equivalent to USD 15,000.00).

Also under the said law, any individual leaving Macau SAR will have to declare to the Macau Customs’ Office, if approached by Customs Offices with any amount, in cash or bearer negotiable instruments, which surpasses the amount mentioned above.

All the information gathered will be centralized and processed by the Macau Customs in order to detect and prevent the transportation of cash and / or bearer instruments which may be used for money laundering the financing of terrorism. In case there is any in indication that these amounts are being used to the said purposes, the Macau Customs Office immediately notify the police and issue an official report, apprehending as well the said amounts until the arrival of the police.

Finally, in terms of sanctions related to the non-compliance with the law, individuals who do not declare the said amounts when obliged to so, or who provide incomplete or false information, are liable to prosecution and subject to penalties from 1% to 5% levied the amount exceeding the reference amount, but limited to MOP 1,000.00 and MOP 500,000.00.

It should be noted that Law 6/2017 will come into force on the 1st of November 2017 although the Chief-Executive still must approve a dispatch the reference amount and the Macau Customs Office forms to effect the declarations referred in the law.

The information contained herein is provided as a general and abstract overview and it should not be used as a basis on which to make decisions and professional legal advice should be sought for specific cases.

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Belt and Road

Initially labelled “One Belt, One Road” (Pinyin – yi dai yi lu) to appeal to its objective of reviving the ancient network of trade routes that connected the East with the West – the Silk Road Economic Belt and the Maritime Silk Road. It is worth remembering that the Silk Road (a modern terminology that derives from the secular profitable trade in silk) played an important role in the development of China (especially during the Han dynasty) and the other regions involved, an objective that its promotors are seeking to emulate.

The initiative later changed its designation to the current “Belt and Road” reportedly to convey the idea that it is not limited to the two ancient routes above referred and the regions that it encompassed, having truly a global outlook. Although its strategy has been widely reported, it was most recently featured in the Forum held in Beijing early this month, namely during President Xi’s speech, which made clear the “win-win” model of the initiative with the aim of promoting trade (and thus countering protectionism) and enhancing cooperation.

The main component of the initiative is the much needed massive infrastructure investment in the countries along the old Silk Road, which is certain to spur trade within the region, with China having pledged already more than one hundred billion US dollars and estimating a total investment of three trillion US dollars.

Back when Premier Li Keqiang visited Macau in October 2016, he affirmed that Macau can play its part with respect to the investment in the Portuguese-speaking countries, a role which Chief Executive Fernando Chui Sai On has affirmed the intention to fully embrace, aside from the remaining opportunities arising from this initiative to Macau. In fact, there are considerable advantages in using Macau (a former Portuguese enclave) as a platform for the investment and development of relationships with the Portuguese-speaking countries, with whom it has historical and cultural similarities.

In that regard, one of the focus designated for Macau has been the provision of legal and cultural services for the Portuguese-speaking countries, which is not only due to the fact that the Portuguese language remains an official language in Macau, but also constitutes the inherent strength and advantage of our legal system. In fact, the importance of the legal aspect is undeniable when making an investment and it can also positively (or otherwise) affect the development of trade. Accordingly, Macau law, as a blend of East and West, can clearly have a role in this initiative, which can also be complemented by the provision of arbitration services in Macau as a neutral ground for the parties involved.

Our firm has been privileged to assist Clients in their internationalisation, especially in their investments in the Portuguese-speaking countries (including Brazil, Angola, Mozambique, Portugal, among others), not only providing advice from a Macau law perspective, but also by connecting them with professionals from those overseas jurisdictions, with whom we have been honoured to have a close relationship.

Furthermore, our firm recently attended the conference entitled “The Belt and Road: A Catalyst for Connectivity, Convergence and Collaboration” and organized by the Hong Kong Law Society in 12 May 2017, demonstrating our willingness to also embrace the Belt and Road Initiative, namely by staying up to date with its latest developments, such as the advantages and risks that the same entail for our Clients.

We hope to leverage the said knowledge with our more than 30 years of experience in advising and assisting in Macau-related matters to serve our Clients in their ongoing and future ventures in Macau and around the world.
Best regards,

Manuela António / José Costa Álvares

General considerations on employment in Macau

Taking into account that we are approaching Labour Day, we believe that it would be interesting to draw our readers’ attention to the basic framework of the Macau regulations concerning employment. Besides Law 4/98/M, which establishes the basic policy principles in labour/employment rights, the main regulatory piece of legislation in this regard is the Labour Relations Law (no. 7/2008), although there are several other ordinances that may be useful in specific cases. The main supervising entity is the Labour Affairs Bureau (with the acronym in Portuguese of “DSAL”).

The main principle of the laws concerning labour in Macau is that the same estipulate the bare minimum conditions that must be provided by the employer and thus that any contractual stipulation (even if agreed by the parties) that provides less rights to the employee is deemed void (and replaced by the applicable legal provision).

Starting with the basics, the minimum age of an employee is 18 years old. However, the employment of minors between 16 and 18 years old is allowed subject to several limitations and conditions (such as obtaining authorization from the parents). Employment of minors between 14 and 16 years of age can also be allowed in even stricter conditions (including the need to procure the authorization of DSAL).

It is not mandatory that an employment contract be agreed in written, except in the case of employment of minors (under 18 years old) or contracts with fixed term duration. The latter must include the domicile of the contracting parties, indication of the term and the reasoning for the fixed term (as opposed to being an open-ended contract), the position and duties, remuneration, working schedule, date of the contract and of the commencement of work. The parties can agree on the probation period, which cannot exceed 90 days except in some specific positions such as managers (can be increased to 180 days) and fixed term contracts (reduced to 30 days).

In terms of the working schedule, the same is limited to 8 hours per day and 48 hours per week. Based on the operation of the employer and provided consent is obtained from the employee, the daily limit can be increased to 12 hours, but the week limit is maintained and the employer must provide additional resting time to the employee. The employer must provide a break of at least 30 minutes after a continuous 5-hour working period, which will not be counted as working hours unless the employee is not allowed to leave the workplace during such break period. Changes to the working schedule must be agreed by both parties and in specific cases the parties can agree on the exemption of working time schedule.

In connection with the above, note that overtime work is defined as the work provided beyond normal working hours and requires the consent of both parties (entitles as well the employee to receive the normal remuneration plus an additional 20%). However, the employer may require the employee to work overtime in cases of force majeure (maximum 16 hours), if the employer is facing a considerable loss (maximum 16 hours) or if the employer is facing an unexpected increase in the amount of work (maximum 12 hours). Overtime work in the latter circumstances must be compensated with the normal remuneration plus an increment of 50% and an additional paid compensatory rest. Night and shift work is also subject to additional compensation.

In terms of weekly rest, the employee is entitled to one day of (paid) rest per week, although if the nature of the activity of the employer so requires or if agreed by the parties, the paid rest period can be set by the employer at a different frequency, provided the ratio of 4 days per month is maintained. In terms of annual leave, the employee can have a minimum of 6 days (paid) after the completion of 1 year of service – for contracts of an inferior duration but superior to 3 months, the employee is entitled to take half day for every month of service. The employee is also exempted from working during mandatory public holidays (as defined in the law) without loss of remuneration.

In terms of justified absences from work, the employee is entitled to 3 days in case of demise of any direct relative, 6 days upon marriage, 2 days with paternity or child adoption (to be extended to 12 days in the case of the demise of the mother), 12 days in the case of pressing need to provide assistance to family member, 30 consecutive or 45 non-consecutive days in case of sickness not related with work, 56 days of maternity leave (which also includes situations of involuntary abortion after 3 months of pregnancy). There are additional absences that are justifiable, but in any case relevant documentation must be provided.

The employee is not entitled to remuneration during the periods of justified absence, except for 6 days of sickness not related to work and maternity leave (if 1 year of service has been completed). Absence due to sickness / accident arising from work is subject to specific regulation (such as that the employee is entitled to remuneration equivalent to 2/3 of the base salary during absence).

It should be noted that the hiring of Macau non-resident workers is subject to authorization to be requested to DSAL, which entails a prior rather complex procedure. Moreover, employment of non-residents is subject to specific provisions not referred above.

As one can certainly understand, the complexities and intricacies of the employment regulations far exceed the mere synopsis above provided and thus we strongly advise the consultation of legal experts in any given situation, especially when engaging non-Macau residents. In that regard, we have been advising our clients for 30 years and appreciate the continuous trust that has been deposited to us.

 
Best regards,
Manuela António / José Costa Álvares