Michael Hay PHOTO

North Korea’s only foreign-founded law firm suspends operations

North Korea’s first and only law firm set up by a foreigner, Hay, Kalb & Associates, will suspend operations, the firm’s principal said in a statement on Monday, as the country grows increasingly isolated.

The firm is a joint venture between the North Korean state and British-French citizen Michael Hay, who has represented foreign clients in the capital, Pyongyang, for 12 years.

Hay said he had made the decision based on “business and geopolitical principles”.

“This decision has been taken only after lengthy and thorough deliberation and an examination of the continuing deterioration of inter-regional relations pertaining to the Korean peninsula,” Hay said in a statement.

“It is not unreasonable to assume that no meaningful change or indicator of change in relations shall occur, if at all, until well after the United States Presidential Inauguration, on January 20, 2017,” Hay said in the statement.

North Korea has come under growing diplomatic pressure since its January nuclear test and a long-range rocket launch in February, which led to a new U.N. Security Council resolution in March that tightened sanctions against Pyongyang.

The majority of Hay’s clients are foreign investors, many of whom have been negatively affected by the sanctions, Hay told Advisory Excellence.

“Sanctions are hurting legitimate foreign investors. There still is no credible, consistent evidence I see of DPRK companies hurting,” Hay said. DPRK stands for Democratic People’s Republic of Korea, the North’s official title.

Very few foreigners live or work in North Korea. Those who do are usually members of the diplomatic or NGO community, although a small group of foreign investors have maintained a quiet and steady presence inside the country.

The suspension takes effect from midnight on Monday, Hay said, with an official suspension scheduled for Aug. 14, the firm’s 12-year anniversary.

Hay, who bills his firm as the only foreign-invested firm in North Korea, said he will still maintain an office in Pyongyang.

North Korea has more than 8,000 law graduates, according to an official 2008 census, half of whom are based in Pyongyang. Most are employed by the state.

Tax PHOTO

Tax update: Budget Law 2016; case law on transfer pricing; temporary equalisation tax; and more

Contents:

– Budget Law 2016 and other new tax measures
– Adoption of the FATCA Law enacting the US-Luxembourg IGA
– Bill of law No. 6858 on the automatic exchange of financial account information in the field of taxation
– Bill of law No. 6847 on the amendments to the EU Parent-Subsidiary Directive and other tax measures
– Circular Letter dated 2 October 2015 regarding the definition of institutional investors
– Case law on transfer pricing (Case No. 34190 dated 22 July 2015) 6 International news 7 Council approves transparency rules on cross-border tax rulings
– The European Commission takes the Grand-Duchy of Luxembourg before the Court of Justice of the European Union – VAT exemption regime applicable to independent groups of persons (Case C-275/15 dated 8 June 2015)
– Case law on the meaning of ‘supply of services’ – subscription contract for the supply of consulting services (Case C-163/14 dated 3 September 2015)
– Decree on the temporary equalisation tax
– Circular Letter on the definition of “car rental company” within the framework of the domestic investment tax credit provisions
– Double tax treaty network

Discrimination by association

The case of a Northern Irish bakery’s refusal to fulfil an order for a cake bearing the slogan “Support Gay Marriage” has been widely publicised in the news since 2014, and litigation has been ongoing ever since.

As this was a case about potential discrimination against a customer, rather than a worker, it was originally heard in the County Court. But the same legislation applied as would have applied to a discrimination case in the Employment Tribunal, so it is an interesting case from an employment law point of view…

…sincere religious belief will not exempt an employer or a provider of services from complying

with the equality laws…

Paul Armson PHOTO

The lowdown on the BACK2Y conference

BACK2Y – literally, “Back to why [you do it]”, i.e advise clients – returns this year after its organiser Paul Armson’s alternative conference of the same name launched in 2014.

Last year, a room at the Birmingham Hilton Metropole just about held 198 for the one day event. This year, in response to demand, Armson (pictured) has booked more space at the city’s International Convention Centre, upped the number of speakers and is hopeful of 350-plus attendees.

The format of adviser conferences tends to be predictable: the latest practical information and opinions are imparted, mainly from providers, together with rehashed gripes and with a couple of motivational speakers thrown in.

The ‘industry’ wants advisers to give clients what it wants – product distribution. It’s time to wake up!

BACK2Y was an altogether much more emotive event.

The allure, according to those who went, was the promise of a space to share ideas at what the participants consider to be the vanguard of financial advice.

Speakers spoke evangelically of epiphanies turning them away from transactional advice, the practice of selling products to meet clients’ perceived needs so ostracised by today’s financial planning frontline.

‘Product’ is a dirty word at BACK2Y, and product providers, with their stands offering free stuffed animals and mugs in exchange for five minutes bending your ear about their latest ‘solution’, are banned.

The lack of corporate sponsorship is reflected in the price, with currently available tickets for this year’s one day event ranging from £297 to £347.

The conference does sell something though – professional elitism.

“Most advisers won’t get BACK2Y. But that’s OK. It only takes a few to start a revolution,” Armson said.

A Yacht & Two Pauls

Armson is a part-time financial adviser and CEO and founder of Inspiring Advisers, a coaching programme in which he teaches advisers “how to really succeed as a lifestyle financial planner”.

BACK2Y is an extension of the philosophy Armson preaches in his adviser training company.

“Inspiring Advisers can show you how to WOW! your clients in return for vastly increased fee income – and have a lot of fun in the process,” according to its website.

Mrs Miggins seeking advice on what to do with a pension pot of £50,000 – low, but sadly above the national average – probably isn’t going to be able to afford that vastly increased fee, so presumably only advisers with a large proportion of pretty wealthy clients need apply.

Not a criticism, but a reality.

Armson himself ‘semi-retired’ in 2005 at the age of 45 and split his time between advising clients and sailing “Spellbound”, his 60 foot Oyster yacht, around the world.

In between that he spent three years working alongside Prestwood Group’s Paul Etheridge, founder of the Institute of Financial Planning and darling of those who consider themselves to be the more progressive element of the advice world.

The two created the much lauded cash-flow modelling tool Truth Financial Planning Software.

No Real Value

Armson’s aim with BACK2Y is to marry up acting in the best interests of clients with acheiving professional nirvana for advisers.

“I wanted to create an event to bring together advisers who also believe that it’s all about the client and helping them get what they want,” Armson said of BACK2Y.

“It’s called BACK2Y because it helps take advisers back to what we should be doing for clients – providing peace of mind, financial security, helping clients live life to the full, helping them get and keep their desired lifestyle.

“That’s what proper financial planning is all about. And that is where the value is. It has nothing to do with this product is better than that product.”

Armson draws his battle lines on these terms; there is “no real value” in providing clients a product or investment based service.

“What clients really want to know is: ‘in return for your fees how are you going to make my life better?'” he said. That is probably a fair assessment of any exchange of hard-earned money for goods and services.

Armson’s point is that financial services has been lacking in this respect.

“The ‘industry’ wants advisers to give clients what it wants – product distribution. It’s time to wake up! Advisers are being paid by the client, so we have to give clients what they want – which isn’t products or investments.

“That’s why there are no product providers at BACK2Y. Just successful practitioners of proper financial planning, some of the best in the UK, if not the world, sharing their experiences, best tips and techniques and – just as important – sharing inspiration to help other advisers get their focus back on what really matters.”

The demise of commission brought on by the RDR shifted the power dynamic from advisers relying on providers for an income, to the other way around.

BACK2Y is a product (pun intended) of that change.

It’s “vibe” might not be to every advisers’ taste, but beneath all that, the fundamental premise of a conference delivered by advisers, for advisers, focused on financial planning, has to be applauded.

If you would like to find out more information about the BACK2Y conference, please visit: http://www.back2y.co.uk/

Multisport PHOTO

14 Pro Athletes Turned Successful Entrepreneurs

In today’s sports-crazed world, athletes like Lebron James and Tony Hawk have quickly become household names. But it’s not just their sport that’s making them famous.

Athletes are becoming known for their entrepreneurship and savvy business deals—earning more off the playing field than on. From personalized apparel to multimillion dollar investment companies, see why these athletes truly “score” in the business world.

14. Oscar De La Hoya

Sports: By age 28, boxing’s “Golden Boy” Oscar De La Hoya had won five titles in varying weight classes, making him the youngest boxer ever to win five world titles. He has a career total of 10 championship belts and was a 1992 Olympic gold medal winner. He has generated $612 million in revenue for his 18 pay-per-view fights.

Business: De La Hoya is the top pay-per-view earner in ring history, bringing in more than $600 million. In 2000, he released Grammy-nominated music album “Oscar” in both English and Spanish.

De La Hoya’s management company, Golden Boy Promotions, consists of more than 40 fighters and numerous businesses, generating more than $100 million annually. De La Hoya personally owns more than 50 percent of the company.

13. Michael Jordan

Sports: Arguably the best basketball player known to the game, Michael Jordan changed the way basketball is viewed. He played for the Chicago Bulls and later for the Washington Wizards, totaling more than $90 million in earnings as a player salary.

Business: Currently, he owns the Charlotte Bobcats (which he bought for roughly $175 million) and is the face of Nike’s Air Jordan sneakers. Other endorsements include Gatorade, Wheaties, McDonald’s, Coca-Cola, Chevrolet, Rayovac and Hanes. His estimated worth was more than $500 million before his divorce in 2006.

12. Venus Williams

Sports: Currently ranked No. 3 in the world in singles and No. 2 in doubles, Venus Williams is a professional tennis player who has redefined women’s tennis. She pulled in $15.5 million from playing this year, according to Forbes.

Business: Williams is currently CEO of her interior design firm “V Starr Interiors”. She also launched her own fashion line in 2007. She is part owner of the Miami Dolphins with sister Serena. In 2001, she signed a five-year endorsement contract with Reebok International for $40 million. Her new book “Come to Win” was No. 5 on the New York Times Best Seller list. She was ranked number 83 on Forbes’ 2010 Celebrity Top 100 list.

11. Tony Hawk

Sports: Sponsored by the age of 12 and pro at 14, Tony Hawk changed the face of the skateboarding world. Over the next 17 years, he entered more than 100 pro contests, winning 73 of them and placing second in 19. In 1999, Tony Hawk landed the first-ever “900” at the X games—two and a half spins mid air! In total, Hawk invented more than 80 tricks.

Business: Hawk is the owner of Birdhouse, one of the largest skateboarding companies in the world, and he started his own clothing line, aptly named “Hawk Clothing.” He has deals with Activision, Six Flags, Kohl’s, Infospace, Adio shoes, Jeep and Sirius Satellite Radio.

In conjunction with Activision, Hawk created Tony Hawk’s Pro Skater Video game in 1999, which quickly became a best seller, now making him the No. 1 action-sports video game franchise. Tony continues to release video games for all gaming systems. He also released an autobiography, which was a New York Times bestseller. Hawk grossed $12 million in 2008 alone, according to Forbes.

10. John Elway

Sports: Although originally drafted to the Baltimore Colts, John Elway played for the Denver Broncos. His initial contract with the Broncos was for a 6 year, $12.7 million contract. He is best known for his 15-play, 98-yard offensive series in the AFC Championship game, aptly known as “The Drive.” He helped lead the Broncos to five Super Bowl appearances and two wins.

Business: Since retirement, he has owned several businesses and writes an NFL blog. He also founded The Elway Foundation, a non-profit organization for the prevention of child abuse. He is also the owner of two restaurants and once owned five car dealerships in the Denver area. He sold them to AutoNation in 1997 for $82.5 million. He is still in the car dealership business.

9. LeBron James

Sports: Drafted directly out of high school to the Cleveland Cavaliers, LeBron James is said to show talent on the same level as Michael Jordan. Earning $19 million in his first 4 years with the Cavs, James recently signed with the Miami Heat for a little less than $16 million.

Business: Before James even signed with the Cavs, Nike signed him to a seven year, $90 million contract. When Nike released his first shoe, Air Zoom Generation, it sold 72,000 pairs at $110 in its first month.

He also owns his own marketing agency, known as LRMR, which secured endorsements with Nike, Sprite, Glacéau, Bubblicious, and Upper Deck. In 2010 alone, James totaled $30 million in endorsements.

8. George Foreman

Sports: This heavyweight champion took the boxing world by storm, with his most notable fight “Rumble in the Jungle” against Muhammad Ali for the world heavyweight title in Zaire, Africa. Although he lost the fight, he pulled in more than $5 million for the fight alone. He won the gold medal in the 1968 Olympic Games for the United States. He was undefeated in 40 straight fights.

Business: Over 100 million George Foreman Grills have been sold worldwide. Foreman sold the marketing rights to his grills in 1999 for $137 million—more than what he ever made in his career as a boxer. His other business ventures include a clothing line and a cleaning product line.

7. Dave Bing

Sports: This seven-time all-star is named one of the NBA’s 50 greatest players. Starting out with the Detroit Pistons, over nine seasons Bing negotiated his contract from $15,000 up to $450,000.

Later, he played two seasons for the Washington Bullets and ended his basketball career as a Boston Celtic. He was the sixth rookie in NBA history to top 1,600 points and held a record of 18,372 points for his career total.

Business: In 1980, Bing launched Big Steel in Detroit. Within a decade, his steel mill was pulling in $61 million in annual sales, making Big Steel the 10th largest African American-owned industrial company in the nation. He later founded Superb Manufacturing, a $28 million-per-year metal stamping company. As chairman of Bing Group, an automotive supplier, he has sales of over $200 million.

6. Roger Staubach

Sports: Staubach was the quarterback for the Dallas Cowboys from 1969 to 1979. In his last year playing, he had an 83.4 passing rating, which was the best mark by an NFL passer at that time. He was an all-NFC choice five times and was selected to play in six Pro Bowls.

Business: In 1997, Staubach founded real estate firm the Staubach Company. He has served as CEO since 1982. The firm had 60 offices in the US, Canada and Mexico, until recently bought by Jones Lang Lasalle for $613 million.

5. Vinnie Johnson

Sports: Seen as one of the greatest “sixth men” in basketball history, Vinnie Johnson helped lead the Detroit Pistons to numerous NBA victories. He is best known for sinking the winning shot in the 1990 NBA finals against Portland with 00.7 seconds left in the game. That same year, he held out on resigning his contract until he signed for $3.2 million in a two year agreement.

Business: After retirement, Johnson founded Piston Automotive. The company now has more than 200 employees and sales of over $85 million.

4. Cal Ripken Jr

Sports: This Baltimore Oriole shortstop is best known for breaking Lou Gehrig’s record of consecutive games played—totaling 2,632 games. He is one of eight players in history to achieve 400 home runs and 3,000 hits. In 1992, he signed a five-year, $30.5 million contract to continue playing for the Orioles.

Business: As chairman and CEO of Ripken Baseball, Inc., Ripken helped build a baseball complex in his hometown of Aberdeen, Maryland. He owns the Augusta GreenJackets (the Class A affiliate of the San Francisco Giants) and the Charlotte Stone Crabs (the class A affiliate of the Tampa Bay Rays). A best-selling author, Ripken also has been the spokesperson for Energizer, Holiday Inn, Rinnai and State Farm Insurance.

3. Chris Webber

Sports: As a member of the Golden State Warriors, Chris Webber became the first NBA rookie to score more than 1,000 points, 500 rebounds, 250 assists, 150 blocks and 75 steals. He is a five-time NBA All Star.

Webber remains the only sixth player in history to average more than 20 points, 9 rebounds, and 4 assists per game. When he signed his contract again with the Sacramento Kings in for $123 million in 2001, his contract made him the second highest paid player in NBA history.

Business: Webber is active in investment companies representing basketball and football players, real estate and film projects. He had endorsement deals with Coca-Cola, EA Sports, Sony Playstation, ESPN the Magazine, Fila, Nike, Pepsi, Carl’s Jr., THQ Wireless and New Era.

He currently owns a real estate development company, Maktub LLC, which primarily focuses on redevelopment efforts in Chicago. He also opened his own restaurant in Sacramento, Calif., aptly named Center Court with C-Webb. He is also a music producer and is featured on numerous hip hop tracks.

2. Wayne Gretzky

Sports: Considered one of the greatest hockey players ever, Wayne Gretzky holds or shares 61 NHL records—40 for the regular season, 15 for the Stanley Cup playoffs and six for the NHL all star game. He was paid more than $40 million from 1989 to 1999.

Business: Gretzky bought the Hull Olympiques of the Quebec Major Junior Hockey League for $175,000 CA, and sold it seven years later for $550,000 CA. In 1992, Gretzky partnered with Bruce McNall in an investment to buy a rare Honus Wagner T206 cigarette card for $500,000 US. It most recently sold for $2.8 million US. He also owns his own restaurant, aptly named Wayne Gretzky’s Restaurant, as well as his own winery. Forbes estimates he earned $93.8 mil between 1990 and 1998.

1. Magic Johnson

Sports: At 6-feet-9-inches, Earvin “Magic” Johnson was the tallest point guard in league history. His 13-year NBA career was spent entirely with the L.A. Lakers. In 1984, Johnson signed a 25-year, $25 million contract with the L.A. Lakers.

Business: Magic runs Magic Enterprises, a chain of movie theaters. The Magic Johnson Foundation has awarded more than $1.1 million to community organizations that focus on HIV/AIDS prevention. He is also known for bringing big business to urban commercial areas. He has partnerships with Starbucks, T.G.I. Fridays and AMC Theatres.

Pensions News – September 2014: budget reforms; legislation; public service pension schemes; and more

Welcome to the latest edition of Pensions News, which aims to help employers and trustees keep up to date with all the latest developments in pensions legislation, guidance and case law. This edition of Pensions News summarises the key developments from September 2014.

In This Issue:

Budget reforms: the announcement that the 55 per cent death benefits tax charge on pension funds held in a drawdown product at death or uncrystallised after age 75 will be abolished in April 2015.
The Pensions Regulator: information on new questions in the DB scheme return; and the publication of the staff determinations procedure that applies to cases where a decision is made by the executive arm of the regulator.
DWP: an announcement about the removal of the NEST restrictions, which also gives some indication on the possible timescale for the introduction of the system for automatic transfers.
Legislation: the coming into force of certain provisions of the Pensions Act 2014; the progress of the Pension Schemes Bill through Parliament and the publication of notices of amendments; and amendments to the draft updated IORP Directive.
HMRC: the coming into force of a statutory requirement for scheme administrators to be fit and proper for the role and the publication of HMRC guidance about this requirement; and the latest Pension Schemes Services newsletter.
Public service pension schemes: a policy note about the NHS pension scheme and Fair Deal; and an update to the directions on valuations and the employer cost cap.
Other news: the annual review of the Pensions Advisory Service; and the Pension Protection Fund’s latest Technical News publication.