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Panelist Commentary on Fintech in Healthcare: Partnerships & Regulatory Frameworks – 27 October 2017

Panelist Commentary on Fintech in Healthcare: Partnerships & Regulatory Frameworks – 27 October 2017

A commentary by Yang Yen Thaw on his views in the panel discussion on Accelerating Innovation: Partnerships & Regulations on the topic “Fintech in Healthcare”. The panelists were Yang Yen Thaw, Managing Director of 2iB Partners, Astrid S. Tuminez, Regional Director, Corporate, External, and Legal Affairs at Microsoft Southeast Asia, Wayne Chia from Asia P3 Hub and Azmul Haque, Managing Director of Collyer Law.

The Fintech for Health event was organized by ACCESS Health International.

 

Accelerating Solutions: Co Industry Innovation and Public Private Partnerships for Health Regulatory Frame Works for the Integration of Fintech and Digital Health

This commentary deals with the talk on Fintech in Healthcare conducted by ACCESS Health International Southeast Asia Pte Ltd – Accelerating Solutions: Co Industry Innovation and Public Private Partnerships for Health Regulatory Frame Works for the Integration of Fintech and Digital Health. The questions it sought to address were – Co-industry partnerships and public private partnerships are the way forward. How can new partnership models accelerate adoption of new technologies and business models? How does a partnership move from idea stage to execution stage, in a way that is beneficial to all parties involved? What factors increase the likelihood of a successful partnership?

 

Fintech in Healthcare: Introduction

Fintech is basically an intersection of financial services and technology. Fintech aims to deliver a seamless user experience both in terms of anytime access to finance and automated payments through the omnipresent mobile phone. Fintech seeks to address opacity, complexity, lack of competition, poor business culture, or high operational costs. It aims to apply disruptive technology to traditional handling of finance, transfers and payments. Further, new technology like blockchain and crypto/virtual currencies have the potential to reduce the cost of and replace transacting in a financial system. Aggressive enforcement of laws, money transmission and other regulations represents an ongoing threat to FinTech companies.

The future of fintech depends on ability to withstand competition from global banks, adaptability by smaller fintech companies and to regulatory framework.

Healthcare can be addressed in several ways. It covers the maintenance, care and restoration of health of body and mind and the process, procedures and methods thereof. Healthcare seeks to prevent, diagnose and treat health issues. Healthcare varies across countries, groups, and individuals and is influenced by social, economic and regulatory conditions. According to the World Health Organization (WHO), a well-functioning healthcare system requires a robust financing mechanism; a well-trained and adequately paid workforce; reliable information on which to base decisions and policies; and well-maintained health facilities and logistics to deliver quality medicines and technologies.

However, the future on healthcare will also be more focussed on the distinctions between healthcare and sickcare, wellness and fitness, patientcare and doctorcare. Healthcare as a matter of opinion is most often 95% doctor care and 5% treatment. So, while regulation of the 5% can cover technology and healthtech, the 95% should be around post-technology and can be a focus for fintech.

 

Of legal and regulatory matters relating to Fintech

Though there are no specific laws to govern fintech, legal application would be in the form of the individual laws themselves i.e., laws relating to finance and technology respectively. Further, laws that affect fintech are – data security and privacy, consumer protection, AML, ATF, insurance and securities. Complications will further arise when there are cross-border transactions.

The other issues that fintech face are sharing and storing of information. Control of information and its flow on personal mobile devices, coupled with sharing over cloud and other common platforms and storage platforms, may require additional security measures by law. Some countries provide approved cloud storage providers. While these do not solve data and security issues, it does mitigate some of them.

Fintech is proceeding at high speeds. As most laws play catch up as well as regulate established practices, regulating fintech is a very difficult process. Besides, it is not efficient to introduce laws and regulations in an industry where disruptive technologies themselves face danger of becoming obsolete or replaced by newer technologies.

 

Of legal and regulatory matters relating to healthcare

Healthcare policies is influenced by social, economic and regulatory conditions of a country and varies across organizations, groups, and individuals. Whether healthcare is a matter of public or private service is also a factor when determining regulations. In many countries, the issue of regulating indigenous or alternative healthcare play a significant role in addition to regulatory treatment relating to homeopathy and allopathy practices. For instance, traditional Chinese medicine, acupuncture, holistic medicine, Ayurveda are examples some of indigenous and accepted healthcare.

There are various agencies that regulate public and private healthcare at different levels. Private organizations also participate in the regulations by providing accreditation, rankings, certification and additional oversight. Areas covered include practitioners and facilities, information flow, legal compliance, safety and other areas in the healthcare industry. Regulations of other regulatory departments are also pertinent such as regulations relating to food and drugs, disease control and prevention and environment.

All areas of healthcare, including physicians, medical directors, healthcare computer technology companies, healthtech, healthcare facilities and pharmaceutical companies, are subject to regulatory review and compliance.

 

Fintech in Healthcare

Areas where fintech in healthcare, public and private, exist or have possibilities are in finance, funding, payments and other monetary issues in healthcare. In developed countries, healthcare will not be provided unless there is “proof of payability”. In developing and underdeveloped countries, “right to life” does not include passage to good healthcare in the Golden Hour.

There are many ways to tie in fintech to healthcare, but this involves active tri-partite participation between Government, healthcare and finance institutions. A tech product that “talks” to these institutions or provides an appropriate platform will improve and provide a more congenial regulatory environment.

Fintech generally covers the following of which many are applicable to healthcare.

  1. Banking infrastructure
  2. Healthcare lending
  3. Consumer lending
  4. Consumer Payments
  5. Crowdfunding for healthcare projects
  6. Equity financing in healthcare projects
  7. Financial healthcare research and data
  8. Financial transaction security in healthcare
  9. Institutional investing in healthcare
  10. International money transfer
  11. Payments backend and infrastructure
  12. Personal finance, insurance in healthcare
  13. Point of sale payments

Some finance services in healthcare cover:

  1. Lending services
  2. Remittance services
  3. Personal finance services
  4. Litigation financing – for doctors and patients alike (medical negligence)
  5. Banking services
  6. Crypto and virtual currencies (substitute funding and alternate payments)

Some payments in healthcare cover:

  1. Out-patients or walk-ins in clinics (daily basis)
  2. In-patients (depending on duration of stay – predictable)
  3. Critical patients (whose duration of stay – unpredictable)
  4. Operative patients (costs – variable)
  5. Wellness clinics (periodic basis)
  6. Geriatric patients (neglected group)
  7. Road traffic patients (identifiable/Good Samaritan based)
  8. Psychiatric patients (may/may not generate income)
  9. Pathology labs (investigations/reports)
  10. Ambulance services (emergency services)
  11. Medicines (delivered at home)
  12. Home-services (post op dressing/health monitoring)

The other related areas for fintech in healthcare are:

  1. Payroll to ancillary staff such as ambulance drivers
  2. Independent healthcare related professionals – medical representatives
  3. Cost monitoring for medical supplies
  4. Third party private healthcare – nurses, hospices, private nursing
  5. Technologies like Blockchain are also potential platforms that bring fintech and healthcare together
  6. Medical litigation financing
  7. Medical negligence cover
  8. Insurance

Some payment services currently operating in healthcare:

  1. Payment gateway providers
  2. POS payments-point of sale-maybe on premise or cloud based
  3. Credit payments
  4. Services running on credit – via banks
  5. Mobile apps
  6. Integrated mobile and browser apps

Of legal and regulatory matters relating to fintech in healthcare

The objective of both fintech and healthcare regulation is to protect the consumer or end user. In most jurisdictions, there is hardly any government agency to integrate any planning, financing, policy making or drafting any legislation relating to fintech and/or healthcare. Though there are no specific laws to govern fintech and healthcare, legal application would be in the form of the individual laws themselves i.e., laws relating to healthcare, finance and technology.

While consideration of legislation and law-making, life and property are given paramount importance. Therefore, most laws and regulations in these areas are stringent. Given that healthcare and fintech are primarily these areas, one can expect higher compliance and due diligence. In addition to specific laws governing healthcare and fintech, combined issues of personal data on finance, health statistics and privacy of individuals need to be considered. Healthcare privacy would also include right to be or not to be treated.

Regulatory approaches will fail to cope with the rapid pace of innovation in fintech and healthcare due to speed of development. It is not possible for regulations to imagine technological advances and introduce anticipatory laws and if regulations are considered with restrictions on a reactionary basis; that would stifle innovation in fintech and healthcare. In the financial crisis of 2008, the introduction of the Dodd Frank Wall street Reform actually galvanized small fintech companies to innovate and disrupt the financial system. It is much harder to regulate these companies. Big banks, in a bid to limit risk and compliance, many times outsourced financial services to these companies who would find ways to skirt regulation and compliance.

Progress in electronic pricing and trading technologies will enable fintech companies to even weave an inextricable web of derivative transactions in healthcare. It is not difficult to image fintech in healthcare bringing in instruments where medical and healthcare loans could be repackaged into instruments such as healthcare backed securities, collateralized debt obligations, credit default swaps and other second order derivative structures. Regulation challenges would be compounded. Tech companies could take advantage as negative fast and first movers to go into financial and healthcare/healthcare areas where there is no existing regulation. Many such companies also carry a very low asset to equity ratio and since they take advantage of the fact that transactions move at high speeds and low costs, they may even close down at the first hint of regulation with no option of recourse left to the user.

 

Public Private Partnership – Regulatory Possibilities

Fintech in healthcare will have different applications in different countries. In an ideal world, there should be universal laws that are common and govern countries universally. But this is not possible under the current geo-political climate. Each country will have a unique approach towards regulating healthcare and fintech. With borderless and seamless deployment of tech products, cross-border regulation is highly complex.

 

Regulatory Sandbox

The objective of a regulatory sandbox is to construct a well-defined space, for a limited duration, within which companies can experiment with innovative tech solutions in a relaxed regulatory environment and with the support of a national regulator. Rather than preventing failure, a regulatory sandbox seeks to provide appropriate protections to limit impact of failure. Regulatory sandbox itself is an innovation of sorts and have been around only for the past few years. UK FCA reports success in meeting its overall objective of reducing time and cost of getting innovative ideas to market.

Regulatory sandboxes may work well in a country such as Singapore where its citizens and corporates comply with the law. Similarly, the regulatory sandbox can be deployed in states or provinces within a country that have a strict adherence or zero tolerance to legal violations. It will also work well with established companies and big players. In fact, some regulatory sandboxes have a minimum financial entry level requirement. However, in many jurisdictions, individuals and smaller companies may prefer the open market. Some companies may explore loopholes that the current regulatory climate provides and exploit them. There is no assurance that these loopholes will be revealed in a sandbox. Some businessmen will operate on the premise that it is easier to seek forgiveness than permission from regulators. Where the regulatory sandbox is intended to be for toddlers to swim around before entering the ocean, the pool itself may be infested with sharks. A regulatory sandbox prima facie appears to appeal more to the regulators who want to analyse and understand a new environment and therefore prepare regulations and paperwork. The sandbox itself may not provide a live environment or appropriate market size to test the product. Almost like applying what an individual studied in school or college to real life. Plus, there is the perceived danger of a company believing it is on a virtual watchlist if it fails in the sandbox. Further, even if the company passes the sandbox, it may decide against deploying the product in that country.

Having said all that, the advantages of a regulatory sandbox are – equity financing and higher probability of receiving investments due to perceived regulatory compliance, speed to market, more reliable financial innovation to the consumer, understanding a local regulatory climate as well as the process – its ease or difficulty – in obtaining a licence or approval.

 

Self-regulation

Self-regulation by fintech companies in healthcare may be considered as an alternative. However, self-regulation must contain a caveat in that the regulators’ approval need to be obtained before deployment. The difference is operating in a live and an international market as well. Self-regulation can commence with intent of compliance by setting out internal policies, rules and regulations. Government can provide guidelines and principles. This collaboration can bring about corporate policies which may contain:

  • Management and personnel management, training, systems and controls
  • Scope of direct and indirect liability of product and outcomes
  • PR, sales and marketing processes; representations made
  • Standard terms and conditions
  • Statutory and regulatory compliance
  • Systems and control processes periodic review

Consequences of non-regulatory compliance would include regular regulatory scrutiny, criminal penalties and civil sanctions, public announcements.

Many fintech entrepreneurs are seasoned. By not limiting functions of a fintech company within a “sandbox” and without the fear of big brother watching directly, fintech companies can be allowed freedom and innovation. By limiting fast and immediate exposure to the market by the aforementioned collaboration, the regulators can anticipate potential problems with the fintech product. The friendliness of the regulator can be displayed in the approach to the self-regulation.

Private public interaction and collaboration should further focus on the following:

  • Help craft consistent, thoughtful regulation for fair use of products
  • Reduce inconsistencies in the scope and application of local regulations (state, province)
  • Standardization of regulatory and supervisory expectations
  • Advancing policy initiatives
  • Coordination between regulators themselves.
…and last but not least, a mandatory selfie with Astrid S. Tuminez, Regional Director, Corporate, External, and Legal Affairs at Microsoft Southeast Asia, Wayne Chia from Asia P3 Hub and Azmul Haque, Managing Director of Collyer Law!

For partnerships, speaker and general business enquiries with 2iB Partners:

Contact Person Dylan Tan
Designation COO
Email Dylan@2ibpartners.com

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8 Points to consider for an IPO

8 Points to consider for an IPO

In the previous parts, for Preparing your Company for a Liquidity Event, we covered:

For the last installment of the series, we’d like to touch on a little on the supposed “holy grail” of companies – the Initial Public Offering (IPO). It is the dream of many entrepreneurs and business owners to bring their company public whether it is the ASX in Australia, the London Stock Exchange, the Hang Seng, the American NASDAQ, NYSE or the Shanghai A.

However, it is one of 2iB Partner’s common mention that IPO is not the end, it is the start of the new beginning and a new level of maturity, reporting and many other things. Liquidity events require special care in the case of IPOs and listed companies.

Here are 8 IPO points out of a long list that people need to consider:

 

8 IPO Points

 

  1. Due Diligence:
  2. Internal due diligence by in-house counsel or project manager to ensure the process is clearly defined with relevant reporting requirements built in. The DD should also sanitize any outstanding issues.
  3.  
    1. Management Appointment or Change:

    While the MD, CEO, Chairman may remain the same, s/he should ensure capable professionals in finance, law, tax and operations on the board to implement smooth transactions, particularly CFOs. Applies more so in cross-border cases. Some Exchanges may have this as a mandatory requirement.

    1. External:

    Ensure appropriate external service providers such as investment bankers, brokers, underwriters, lead managers, auditors, depositories, certified advisers.

    1. Regulatory:

    Depending upon the extent of shares traded, laws of different countries will need to be adhered to. This not only covers compliance related to trading, but anti-trust (anti-monopoly), employment, local authorities and tax.

    1. Insider Trading & Market Abuse:

    The silver bullet is disclosure. However, the subject matter and timing of disclosure will require the involvement of certified adviser or notified agent or sponsor or the exchange itself.

    1. Valuation:

    If more than one country is involved in any of the liquidity events, the valuation itself and corresponding taxation, will undergo change depending upon that country’s laws.

    1. PR:

    PR agencies that specialize in announcements to the public. Care has to be ensured that announcements need to be in consonance with legal disclosure requirements.

    1. In-house counsel:

    In-house counsel to coordinate with all internal and external compliances and more importantly in coordinating with different law firms, PR agencies, investment bankers, underwriters, certified advisers and other legal authorities as there will be international elements in the liquidity events apart from controlling costs and preparing documentation.

     

For partnerships, speaker and general business enquiries with 2iB Partners:

Contact Person Dylan Tan
Designation COO
Email Dylan@2ibpartners.com

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8 Legal Points to note during a Liquidity Event

8 Legal Points to note during a Liquidity Event

Flashing back to Part 1, a liquidity event is an exit strategy for investors to convert their equity into cash and occurs when any of the following typical change of control events takes place:

  1. merger
  2. acquisition
  3. sale purchase – part or whole, shares or assets
  4. leveraged recapitalization – debt to finance purchase of equity
  5. ESOP
  6. IPO of a company

The occurrence of liquidation, dissolution or winding up of a company may also be included as a liquidity event.

Continuing on from Part 2: 8 Considerations before the liquidity event, which in summary talked about the below 8 considerations, we now move on to Part 3: 8 Legal Points to note during a liquidity event.

  1. Types of entities involved
  2. Cash receipts or pay-outs
  3. Escrow Consideration
  4. Type of Equity
  5. Value of Equity
  6. Local Laws
  7. Effects on Employment
  8. Tax matters

As if Part 2 were not exciting enough, here is where the real exciting part comes. Here are practical things to take note of DURING the event itself. You’ve flirted ideas with your buyer/investor and finally there is some understanding and mutual agreement after a courtship process.

However, here is where you will need to get really cautious and have a full understanding on what each part means and why it is done. The below is a far from exhaustive list but points out some essential points to note.

 

8 Legal Points to note

 

At the liquidity event itself, the following legal issues should be considered:

  1. Representations and warranties in contract containing the liquidity events that could make or break a deal

Sometimes overlooked as standard clauses, a target is willing to give any and all representations and warranties that an acquirer is looking for. But this could be quite dangerous as the sale and purchase agreement will invariably contain indemnity clauses and this will affect the deal. In a sale and purchase agreement, certain specific representations and warranties are covered within the substantive part of the agreement itself and many so-called standard clauses are covered as an annexure, schedule or attachment to the main agreement. The standard clauses are mostly the sum total of the experiences of professionals and standard templates that have evolved over time. Involvement of local lawyers is required. Misrepresentations could have serious legal repercussions.

 

  1. Covenants (to do or not to do something) and obligations. On pre-closing, closing and post-closing

As with all financial transactions, a buyer would seek to protect his money and delay payment until all conditions are satisfied and a seller would agree to do anything to receive the pay-out at the earliest. Incapacity to pay, failure to fulfil conditions, non-receipt of corporate and statutory approvals are some of the factors where the deals fall through. Post-sale, many negative covenants such as non-disclosure, non-compete, non-solicit and non-circumvention would continue to operate and can operate against the seller/target and affect the future operations of the target.

 

  1. Special rights that are covered in the agreement, such as options, transfer, approvals, put-call, drag-tag along, lock-ins/lock-ups, share-asset price ceilings

Liquidity events call for perusal and scrutiny of past and future contracts for sale and purchase, subscription and shareholders agreements. Many corporate, statutory and regulatory approvals are required. The constitution or articles of the target may also contain special rights of existing shareholders. In some occasions, agreements between shareholders may be privy and enforceable between shareholders and not involve the company. In these circumstances, the company will not be liable for the contract inter se shareholders unless these rights are enshrined within the constitution documents.

 

  1. Indemnification, liabilities and remedies. Who bears consequences

Liabilities and indemnification thereto vis-à-vis the seller are called for misrepresentations and failure to comply with conditions of transfer. Similarly, the buyer can also be liable by forfeiting his deposit at the time of signing a contract as well as be liable for indemnification for non-payment/non-fulfilment of conditions of the contract. Legal liabilities should be monitored during and after the liquidity event.

 

  1. Set offs. Does cash pay-outs or equity issuance create set-offs on price and valuation?

If projections are not met or if conditions fail during the course of a transaction that does not involve a bullet payment, this will affect the cash pay-out as well as issuance of equity. Some events for set-offs in terms of cash and time may be mitigated by force majeure clauses. Even in bullet payments, if negative covenants are violated, the seller can still be dragged into litigation and set-offs may not mitigate the risk.

 

  1. Other contracts relating to or effecting the liquidity event

The occurrence of liquidity events affects many other factors in the target. Investors will seek blanket clauses covering their investment in the present and near future and will look out for other contracts entered into by the target that affect the valuation of the company or its shares. The other contracts would include existing shareholders agreement, deeds of adherence, options agreements, voting agreements, warrants, management agreements, key employee agreements, debt instruments and agreements, share subscription agreements, constitution documents – where the company is bound to do or not do certain acts. Documents such as warrants may also contain provisions for protection when public acquisitions take place. Normally, a due diligence covers these issues. Negligence of a proper due diligence affects the investor greatly rather than the target.

 

  1. Governing law. This is particularly relevant on cross-border transactions

Some countries provide specifically for the place where the cause of action arises and thus bring the parties within that jurisdiction. Some countries may completely ignore the governing law and protect its citizens, individuals and corporates. The governing law also matters as contracts are interpreted differently, whether under civil law or commonwealth law or general law by different countries. There have been instances where the governing law is of a jurisdiction different from the nationalities of both parties.

 

  1. Dispute resolution. Arbitration, mediation or local courts

Alternate dispute resolutions such as mediation, arbitration and conciliation may mitigate consequences when heads of the respective parties meet, but these may be exercises in futility. Where the parties are from different countries, treaties between the countries where the parties reside will dictate whether a judicial order passed can be enforced against the penalized party. Many parties settle for international arbitration which can be slightly more expeditious than established court systems. This is because arbitration takes only a particular matter into consideration whereas the courts have to handle all matters relating to its jurisdiction.

Stay tuned for the LAST part of the series: 8 Points on Initial Public Offerings

For partnerships, speaker and general business enquiries with 2iB Partners:

Contact Person Dylan Tan
Designation COO
Email Dylan@2ibpartners.com

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8 Considerations when Preparing your Company for a Liquidity Event

8 Considerations when Preparing your Company for a Liquidity Event

Liquidity events are usually an exciting and most looked forward to event in the business cycle. For some it means injection of new growth capital, for others it means cashing out their multi-million dollar exits. While it is certainly an event to look forward to, it is also something that should be planned towards.

Flashing back to part 1, a liquidity event is an exit strategy for investors to convert their equity into cash and occurs when any of the following typical change of control events takes place:

  1. merger
  2. acquisition
  3. sale purchase – part or whole, shares or assets
  4. leveraged recapitalization – debt to finance purchase of equity
  5. ESOP
  6. IPO of a company

The occurrence of liquidation, dissolution or winding up of a company may also be included as a liquidity event.

Here are 8 Considerations in the preparatory stage:

 

8 Considerations

 

Types of entity involved – company, trust, JVs. Regulation in cross-border related events.

Far as regulations are concerned, foreign direct investment regulations play a role in control over the target as well as limits on the amount of investment. Some countries place a particular valuation method over others and these will have to be adhered to. Compliance and recognition of an entity within the books of the target regarding the transactions would vary depending upon the type of entity. If a branch office of an acquirer is involved, there would be other considerations.

 

Cash Receipts or Pay-outs: in full or instalments. Earn out provisions. Shares or assets.

If the liquidity event amount is low or the target’s financial statements readily manageable, it could mean a bullet payment of a cash transaction. However, if the valuation is high, the pay-out may be partly in shares or partly in cash. The cash to be paid out will be based on performance and milestones achieved by the target over a period of time. This tends to keep the founder in place for an extended period and limits risk for the investor. If payment is made over a given period and liabilities emerge, the cash consideration could be affected as indemnities would kick in. A public company divestment or sale would result in a direct cash transaction with direct market price without valuation asymmetry.

 

Escrow consideration

One of the biggest considerations for the target is completing the transaction in the minimum time frame. An acquirer may make an offer out of belief that the transaction would pay for itself, and the question of whether the acquirer pays on time or has the capability to pay is relevant. Post-transaction, it would be difficult for the target to roll-back. Setting up an escrow or obtaining bank guarantees would be a way to offset the risk to the target. However, this may meet with resistance as no party would like to tie up their funds over a period of time where it can be put to other use. Many acquirers would also leverage the same funds by committing to different projects at the same time.

 

Type of equity. Voting provisions, restrictions in transfers, convertibility

Some liquidity events involve ordinary share transactions and some preference share transactions or a combination of both. The transactions may also be in the nature of bonds and convertible instruments. These shares may carry different voting rights. Some are compulsorily convertible at a given period and some indefinitely – meaning over a long period of time. Some countries may have restrictions on different classes of shares and shares carrying different voting rights. Targets may convert shares into one class before triggering a liquidity event. The manner of shareholding in private companies would be governed by documents such as shareholders or subscription agreement.

 

Value of equity. Volume weighted average if listed company

Valuations of shares may vary. Some of the methods are: Asset pricing (intrinsic value) – which are based on the real value of the assets; market value basis (yield basis or earning capacity) – where the effective rate of return on investment in terms of a percentage is taken into consideration; fair value basis – the mean of intrinsic value and yield value; return on capital – where predetermined or expected rates of return are applied; price-earnings ratio – the ratio of the market price of the share to earning per equity share; DCF – discounted cash flow where discounting of the profits (dividends, earnings, or cash flows) of the shares in the future and a final value on such disposal. In the case of listed companies, some use a fixed period volume weighted average of the existing share price and add a premium to it to make a public offer or tender. Goodwill is a factor that needs to be factored in while calculating the cost of equity. Much consideration may be swept under the goodwill valuation.

 

Local laws governing payment and transfer

Foreign direct investment or FDI regulations play a role in contracts for sale and purchase of shares involving different countries. It also addresses control over the target and limits on the amount of investment. Some regulations stipulate the valuation methods used. Compliance with registration of new owner and the type of entity would vary. For instance, some jurisdictions do not recognize trusts and only its trustees. While some countries may permit compensation for projected loss, others do not. Different countries also have different treatments on law and tax involving future equity, restrictions on different classes of shares and shares carrying different voting rights.

 

Effects on employment – local and international in cases of cross-border related events

Acquisitions on occurrence of liquidity events must take into consideration the effect on employment within the target. Post-acquisition may result in less than desirable effects on the economics and hence post-valuation of the company itself. In addition, effects on employment may hinder the liquidity event especially when trade unions are involved. Many governments take special care to see the labor market is not affected and this in turn affects the liquidity event.

 

Tax matters – double taxation in cases of cross-border related events.

During the sale of shares, taxation may be a driving factor for the type of shareholder who may be a trust, a listed company or as in the US a C-Corporation or an S-Corporation. Similarly, purchase may be made by a similar entity. In some cases, a joint venture may attract different tax considerations. Further, consideration should be given to double taxation avoidance agreements where tax paid in a country can be offset or credit claimed in the home country.

 

Stay tuned to Part 3: 8 legal points

For partnerships, speaker and general business enquiries with 2iB Partners:

Contact Person Dylan Tan
Designation COO
Email Dylan@2ibpartners.com

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2iB Partners to speak at ACCESS: Fintech For Health Conference 26-27 October, 2017

2iB Partners to speak at ACCESS: Fintech For Health Conference 26-27 October, 2017

2iB continues to play an active role in advising on the various business ecosystems and how different sectors can engage with each other seamlessly.

As part of the panel of experts, Mr. Yang Yen Thaw, Managing Director of 2iB Partners will be speaking at the Fintech For Health Conference on “Accelerating innovation: Partnerships and regulatory frameworks for the integration of fintech and health tech” as part of a 30 minute panel discussion with veteran lawyers on regulatory frameworks.

 

FINTECH FOR HEALTH

Fintech for Health is a high level conference exploring key opportunities at the intersection of fintech and health tech. We are bringing together people and partners from across sectors to envision healthcare of the future— one that is patient centered, high quality, affordable, and accessible. We will explore how the integration of fintech with digital health technologies, such as blockchain and artificial intelligence, can result in improved healthcare access and quality, across resource poor to resource rich settings.

Hear from experts on real world health systems challenges and the innovative approaches that companies and governments are using to tackle them. Explore the role of deep technology in making health financing more secure and efficient. Meet like minded individuals and organizations across industry, development, and government who are committed to outcomes and impact.

 

Registrations open at http://fintechforhealth.com/

For partnerships, speaker and general business enquiries with 2iB Partners:

Contact Person Dylan Tan
Designation COO
Email Dylan@2ibpartners.com

YOU MAY LIKE

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