Social Enterprise Law Surveys |
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Macau |
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| (Asia Pacific) Firm MdME | |
| What jurisdiction(s) do you practice in? | Macau SAR, China |
| What are the most commonly used types of for-profit corporate organizational forms in your jurisdiction (e.g., corporation, limited liability company, benefit corporation, social purpose corporation, etc.) used by Enterprises operating a trade ... | The most common for-profit organizational forms used in Macau are (i) limited liability company by quotas which offers substantial management flexibility and corporate governance (e.g., minimum of 1 shareholder and a share capital of MOP25,000.00), as well as lower accounting requirements; and (ii) joint stock companies, which require a more complex structure (board of directors, company secretary and supervisor) and must comply with more stringent accounting and tax reporting obligations, besides the minimum requirements of 3 shareholders and of share capital of MOP1,000,000. These forms are normally used for standard commercial and business operations in Macau. However, a sole proprietorship is also usually used for operating a trade or business. a. For enterprises seeking financing from investors with multiple owners, a joint stock company is a more common vehicle. It provides flexibility in terms of seeking investors by selling shares. Joint stock companies are normally used for highly regulated activities or more investment driven companies (such as gaming operators, banking, finance, energy, telecom, aviation etc.). Notwithstanding, a limited liability company by quotas may also be used for purposes of bringing financing from investors. b. Limited liability company by quotas is the most common and flexible for for-profit organizational. |
| Do any of your jurisdiction’s traditional organizational forms require or permit the board or managers to consider, balance or prioritize interests other than shareholder value in decision making? What other interests, if any, are they required... | According to article 235 of the Macau Commercial Code, the company's directors must always act in the company's interest and must exercise the diligence of a judicious and orderly manager. Company’s interests are generally understood as being the pursuit of profit and/or shareholder value. Companies may consider other interests if these are ancillary to the pursuit of shareholders value. |
| Does your jurisdiction have organizational forms specifically designed for Social Enterprises? If so:a. What type(s) of organizational forms are they?b. How do they materially differ from the most closely analogous traditional organizational ... | There are no organizational forms specifically designed for Social Enterprises in Macau. |
| Are Social Enterprises permitted to be formed and operated as Nonprofits? If so: a. Are Nonprofits that are Social Enterprises treated differently under the law as compared to Nonprofits that are not Social Enterprises, whether from a corporat... | In Macau, most of Social Enterprises are operated under a form of nonprofits (such as foundations or associations), as they pursue social advancement causes instead of profit; however, there is no special framework or treatment by virtue of being a Social Enterprise. |
| Does your jurisdiction allow for worker-owned Enterprises, such as cooperatives? If so, please describe any material benefits of, and/or restrictions on, using such forms. | There are no worker-owned Enterprises such as cooperatives in our jurisdiction. |
| Are there unique reporting requirements for Social Enterprises? If there are, please describe them. Please also discuss what government bodies Social Enterprises are required to report to. | There are no unique reporting requirements for Social Enterprises in Macau. |
| In your jurisdiction, has case law and jurisprudence evolved to address Social Enterprises? If there is meaningful jurisprudence around Social Enterprises, please provide some brief examples. | Macau is a typical civil law legal system, in which legislations are the main source of law and precedent does not form case law. Social Enterprises are not common in Macau and we are not aware that there is precedent, or jurisprudence around Social Enterprises. |
| Does your jurisdiction have any ESG requirements for Enterprises generally? If it does, please describe. | ESG requirements are not established for the Enterprises generally. However, the are some incentives or awards initiated by the Government in order to encourage the promotion of ESG. |
| Does your jurisdiction have any ESG requirements specifically for Social Enterprises? If it does, please describe. | There is no ESG requirements set out specially for Social Enterprises. |
| Does your jurisdiction have any ESG requirements for investors? If it does, please describe. | There are no ESG requirements established for the investors generally. However, there are some incentives or awards initiated by the Government in order to encourage the promotion of ESG. |
| Are any major investor classes (e.g., pension funds, mutual funds, etc.) required to look at ESG issues when making investment decisions in your jurisdiction? a. If they are, please describe the requirements.b. If they are not, are they permi... | There are no such requirements in our jurisdiction. |
| What kinds of philanthropic funding do Social Enterprises in your jurisdiction commonly receive (e.g., grants, charitable investment, traditional investment)? | Social Enterprises in Macau usually adopt the form of non-profit associations, the source of their funding normally come from founders’ contribution, grants or government subsidies. |
| How prevalent, if at all, are new for-profit impact investments in your jurisdiction (e.g. traditional instruments with impact terms, new investment instruments, aggregation with philanthropic capital, community based funding, etc.)? | For-profit impact investments have been increasing in Macau, especially notable in companies with foreign investments. In addition, what have been seen is that traditional companies or investments are now more aware of the importance of impact investments, however, new instruments for impact investments are not common. |
| What are the types of government funding and support available to Social Enterprises, if any, available in your jurisdiction (e.g., grants, investments, bonds, and guarantees)? a. How difficult is it for Social Enterprises to obtain government... | The Macau Government launched 2 phases of funding "Financial Assistance Scheme for Employment Development of People with Disabilities" in 2010 and 2014 for non-profit social service organizations interested in applying for funding to start and operate a Social Enterprise development project with a business model. The application is not difficult and there is no limitation to Enterprises incorporated using Social Enterprise forms as this form does not exist. |
| Are there any companies that are formed as a Social Enterprise listed on your jurisdiction’s leading securities exchange(s)? | No. |
| To what extent are publicly traded Enterprises required to disclose ESG related factors in annual reports/public filings in your jurisdiction. | N/A |
| How prevalent, if at all, are impact bonds in your jurisdiction? | N/A |
| In your jurisdiction, are there any restrictions on foreign investments or donations that are unique to Social Enterprises (whether incorporated as for profit entities or as Nonprofits)? | No. |
| Is “crowdfunding” legal in your jurisdiction? Are there rules under applicable securities laws that make it easier for smaller businesses or Social Enterprises to take money from investors that are not sophisticated/accredited/qualified under a... | There are no rules that make it easier for smaller businesses or Social Enterprises to take money from investors. Crowdfunding may not be pursued by non-financial institutions (i.e. duly licensed by the Macau Monetary Authority). |
| Are there any tax exemptions that are uniquely available for Social Enterprises? a. Please describe any tax exemptions that are available and whether they are partial or full.b. Are they dependent on the Social Enterprise utilized using a spe... | There are tax exemptions available for Nonprofit organizations generally, but there are no tax exemptions that are uniquely available for Social Enterprises. According to article 9 of Regulation of Supplementary Income Tax approved by Law no. 21/78/M, the following situations are exempt from complementary income tax, among others: (i) income from mutual aid associations derived from the investment of capital; (ii) income from associations or organizations of any religion or cult which are recognized as having legal personality and (iii) organisms, associations, collectivities, communities, institutes and other moral persons for the first $ 20,000.00 of their taxable income or profits, besides the exemptions expressed in law. |
| Are individuals or other organizations able to provide tax deductible donations to for-profit Social Enterprises? If they are, please describe any restrictions applicable to tax deductible donations? | No. |
| Are there any other tax benefits uniquely available for Social Enterprises? (e.g. deferrals, favorable tax rates, business deductions, etc.) | No. |
| Does your jurisdiction provide for reciprocal recognition of tax-exempt status that has been granted under the law of any other jurisdictions? | No. |
| Does your jurisdiction have Regulatory Sandboxes or similar policy frameworks for Social Enterprises? If it does, please describe. | No. |
| What government operational support, resources, training or services, are available for small businesses or Social Enterprises? | The government supports consist mainly in funding, as described in II.4. |
| Are there different compliance requirements for different types of Social Enterprises than for traditional Enterprises? Please provide examples if there are. | There are no different compliance requirements. |
| Is there a dedicated government agency or department that oversees Social Enterprises? If there is, please describe its mandate and effectiveness. | There is no dedicated government agency or department that oversees Social Enterprises. |
| Is there a different bankruptcy system available for Social Enterprises? | There is no different bankruptcy system available for Social Enterprises. |
| What are the average time and filing fees to form an Enterprise in your jurisdiction? | Registration of a company in Macau takes between 10-15 business days. Registration fees vary from 300 MOP – 3000 MOP depending on the share capital of the company. |
| What government or third-party certifications or accreditations, if any, are available for Social Enterprises that allow for access to benefits e.g. funding, beneficial tax status, etc.? Please provide examples and briefly describe them as well... | There are no government or third-party certifications or accreditations designed for Social Enterprises. |
| Please describe whether, in your opinion, startups and other entrepreneurial Enterprises generally can easily form and flourish in your jurisdiction. | Yes, startups can easily be incorporated and operate in Macau. Macau Government actively supports start-up companies, including funding and providing working spaces, when the relevant conditions are fulfilled. The Macau Economic Bureau provides numerous financial aid schemes. |
| Please describe whether, in your opinion, Social Enterprises, in particular, can easily form and flourish in your jurisdiction. | Since there is no special legal framework for Social Enterprises, organization which pursues Social Enterprises normally adopt the form of not-for-profit association, which are easy to be incorporated in Macau. |
| Please describe whether in your opinion there are any laws that are obstructive to the formation of Social Enterprises (i.e. that actively disfavor or penalize, or otherwise discourage their formation) in your jurisdiction (for example, are Soc... | N/A |
| In your jurisdiction, are there any major fraud concerns or defects due to corruption or fraud that should be addressed? If there are, please briefly discuss the concerns or defects. | No. |
| What changes to the law do you think would be most beneficial to enabling Social Enterprises to flourish in your jurisdiction? | The removal of the obligation of the directors to pursue shareholders' value should be removed. A formal legal framework regulating Social Enterprise shall be established. Also, the availability of financial incentives and resources supports will be important for the promotion of Social Enterprise in Macau. |
| What changes to the law do you think would be most beneficial to enhancing the social and environmental responsibility of Enterprises generally (whether or not Social Enterprises)? | It would be good if the ESG requirements, including its reporting duties, could be included in the decision-making process regardless of the type of organizations established in the current legal system. |
| Is there anything else you would like to add or guidance you would like to provide? Are there any questions we should have asked but did not? | There is still not much room for the development of social enterprises in Macau. The Macau Government did start to introduce policies to promote the establishment of Social Enterprises, but so far, not many Social Enterprises have been established and operated due to various difficulties, including the applicable legal framework high cost for operation and lack of incentives. |
Social Enterprise Law Surveys
Macau SAR, China
The most common for-profit organizational forms used in Macau are (i) limited liability company by quotas which offers substantial management flexibility and corporate governance (e.g., minimum of 1 shareholder and a share capital of MOP25,000.00), as well as lower accounting requirements; and (ii) joint stock companies, which require a more complex structure (board of directors, company secretary and supervisor) and must comply with more stringent accounting and tax reporting obligations, besides the minimum requirements of 3 shareholders and of share capital of MOP1,000,000. These forms are normally used for standard commercial and business operations in Macau. However, a sole proprietorship is also usually used for operating a trade or business.
a. For enterprises seeking financing from investors with multiple owners, a joint stock company is a more common vehicle. It provides flexibility in terms of seeking investors by selling shares. Joint stock companies are normally used for highly regulated activities or more investment driven companies (such as gaming operators, banking, finance, energy, telecom, aviation etc.). Notwithstanding, a limited liability company by quotas may also be used for purposes of bringing financing from investors.
b. Limited liability company by quotas is the most common and flexible for for-profit organizational.
According to article 235 of the Macau Commercial Code, the company's directors must always act in the company's interest and must exercise the diligence of a judicious and orderly manager. Company’s interests are generally understood as being the pursuit of profit and/or shareholder value. Companies may consider other interests if these are ancillary to the pursuit of shareholders value.
There are no organizational forms specifically designed for Social Enterprises in Macau.
In Macau, most of Social Enterprises are operated under a form of nonprofits (such as foundations or associations), as they pursue social advancement causes instead of profit; however, there is no special framework or treatment by virtue of being a Social Enterprise.
There are no worker-owned Enterprises such as cooperatives in our jurisdiction.
There are no unique reporting requirements for Social Enterprises in Macau.
Macau is a typical civil law legal system, in which legislations are the main source of law and precedent does not form case law. Social Enterprises are not common in Macau and we are not aware that there is precedent, or jurisprudence around Social Enterprises.
ESG requirements are not established for the Enterprises generally. However, the are some incentives or awards initiated by the Government in order to encourage the promotion of ESG.
There is no ESG requirements set out specially for Social Enterprises.
There are no ESG requirements established for the investors generally. However, there are some incentives or awards initiated by the Government in order to encourage the promotion of ESG.
There are no such requirements in our jurisdiction.
Social Enterprises in Macau usually adopt the form of non-profit associations, the source of their funding normally come from founders’ contribution, grants or government subsidies.
For-profit impact investments have been increasing in Macau, especially notable in companies with foreign investments. In addition, what have been seen is that traditional companies or investments are now more aware of the importance of impact investments, however, new instruments for impact investments are not common.
The Macau Government launched 2 phases of funding "Financial Assistance Scheme for Employment Development of People with Disabilities" in 2010 and 2014 for non-profit social service organizations interested in applying for funding to start and operate a Social Enterprise development project with a business model. The application is not difficult and there is no limitation to Enterprises incorporated using Social Enterprise forms as this form does not exist.
No.
N/A
N/A
No.
There are no rules that make it easier for smaller businesses or Social Enterprises to take money from investors. Crowdfunding may not be pursued by non-financial institutions (i.e. duly licensed by the Macau Monetary Authority).
There are tax exemptions available for Nonprofit organizations generally, but there are no tax exemptions that are uniquely available for Social Enterprises.
According to article 9 of Regulation of Supplementary Income Tax approved by Law no. 21/78/M, the following situations are exempt from complementary income tax, among others: (i) income from mutual aid associations derived from the investment of capital; (ii) income from associations or organizations of any religion or cult which are recognized as having legal personality and (iii) organisms, associations, collectivities, communities, institutes and other moral persons for the first $ 20,000.00 of their taxable income or profits, besides the exemptions expressed in law.
No.
No.
No.
No.
The government supports consist mainly in funding, as described in II.4.
There are no different compliance requirements.
There is no dedicated government agency or department that oversees Social Enterprises.
There is no different bankruptcy system available for Social Enterprises.
Registration of a company in Macau takes between 10-15 business days. Registration fees vary from 300 MOP – 3000 MOP depending on the share capital of the company.
There are no government or third-party certifications or accreditations designed for Social Enterprises.
Yes, startups can easily be incorporated and operate in Macau. Macau Government actively supports start-up companies, including funding and providing working spaces, when the relevant conditions are fulfilled. The Macau Economic Bureau provides numerous financial aid schemes.
Since there is no special legal framework for Social Enterprises, organization which pursues Social Enterprises normally adopt the form of not-for-profit association, which are easy to be incorporated in Macau.
N/A
No.
The removal of the obligation of the directors to pursue shareholders' value should be removed. A formal legal framework regulating Social Enterprise shall be established. Also, the availability of financial incentives and resources supports will be important for the promotion of Social Enterprise in Macau.
It would be good if the ESG requirements, including its reporting duties, could be included in the decision-making process regardless of the type of organizations established in the current legal system.
There is still not much room for the development of social enterprises in Macau. The Macau Government did start to introduce policies to promote the establishment of Social Enterprises, but so far, not many Social Enterprises have been established and operated due to various difficulties, including the applicable legal framework high cost for operation and lack of incentives.