JACK'S CORNER
Welcome to the first of many editions of the GCSL monthly newsletter. Each month, I plan to write a few words regarding an international business topic that pops up on my radar screen. Constructive criticism, insights or even applause (even if undeserved) will be well-received.

As GCSL has just concluded its first month of operations, I suppose a few thoughts on starting a new business in Hong Kong are appropriate.
Three cheers for the GCSL people. I am truly fortunate to have a great group of people who know what they are doing, work hard, support me when I need them, kick me when I need it, smile a lot, sip a glass of wine with me at 6pm most days while listening to my "old people's" music and generally make the business of running a business a ton of fun!!! Most of my "family" has worked with me for more than five years. Thanks to all of you. I mean it when I say that I would not come to work without you!
Heartfelt thanks to the overwhelming support of my friends/clients, who have decided to work with GCSL. We look forward to working with you, and we will do our best to ensure you receive the service you expect. I am a sucker for loyalty, and I am here for you 24/7, be it business or personal...just tinkle the JackBerry and I will get back to you.
Thanks to Yvonne and Horace for deciding to pass the Asia Offshore Association (AOA) baton to me and the great people at GCSL. We are looking forward to building upon the solid foundation laid by these pioneers, and working with members of the industry to ensure a spectacular future for the AOA. We look forward to seeing you at the 2006 Conference in Bangkok from 27th to 29th September.
Setting up this office reminds me why I love to work in Hong Kong. Although landlords are difficult and space is expensive, I have to say that the people of Hong Kong know how to get things done. Congrats to all our service providers who asked how high when we asked them to jump, worked all hours of the day and made the deadline. Only in Hong Kong!!!
I made a promise when launching GCSL to have our first of many cocktails in July. How do I remember? Simply because so many of you keep reminding me!!! Well, here ya go - "Wine, Food and Song I" will be held at our office on Friday, 28th July at 6pm. Please RSVP to our Ms. Hydon Or at hydon@gcsl.info so we can guarantee enough bottles and food for all. If you miss this one, don't worry...we will have more for sure!!!
I am also pleased to announce the launch of our website at www.gcsl.info. Please have a browse. We accept all sorts of comments!

Off to "school" (what I call work). Thanks for taking the time to read my thoughts for the month.

Onwards and upwards...
WORK, FUN, FOOD AND WINE...FROM LONDON BACK TO HONG KONG!

We landed in London at 5:30am, had our first conference call at 7:30am (who were you, I can't remember?), meeting at 9am (thanks, Martin; let's do it!), 12 Noon, 2pm, 3:30pm (great to see y'all Robert, Tony, Salman, Paul, Shamshed and Michael), 5pm (thanks for the good ole fashion pub beer Marek and Miroslav...M&M?) and finished off around 11pm after a few nice bottles at the Boxwood Cafe with two happening entrepreneurs (good one Glen and Mark!!!) Day one complete...or was it a week?

The next day saw us pop over to Lausanne for lunch with our Panamanian friend (Ciao, Frankie) prior to the June meeting of the International Tax Planning Association ("ITPA"). This was our first meeting at the ITPA as GCSL. We were pleased with the overwhelming welcome from Elizabeth, Milton and all the great people who make the ITPA our favorite platform for mixing business and pleasure. Some of those great people joined us for dinners on Sunday (how 'bout that white, Ludovic!?) and Monday (what time did that bar close, Peter, Frankie and Anthony?). Many thanks to Bank Leu (as always, well-done Thomas) and ILS (spectacular boat trip, David!) for the perfect cocktail parties. Three cheers for the speakers...a tough job, but y'all were up to the task! And to all of our friends, too many to mention here, we thank you for all the kind words and congrats on the launch of GCSL!!!


Private dinners and cocktail at ITPA sponsored by GCSL

Ah, Budapest...thanks for the ride Peter and congrats Marta for putting up with Gabor for 21 years...we are pleased you decided to make him a decent man when you were only 10!!!

Next, we visited the city for which, given the limitations of the English language, there are simply not enough adjectives to describe the splendor. Yes, Prague. Good to meet Peter and colleague. Many thanks to Marta (no more 2in1?), Marek (sans other M) and Pyor (just one more of those pear drinks...yeah, right!) and, as always, Richard is a great person with whom to enjoy lunch (how many kilos did you shed?).

Tallinn with the fellas, and of course the lovely Eva-Marie...congrats Erik, condolences Eva-Marie...when Priiten, when is it your turn? And thanks Piers...really, thanks!!!

Great city, Moscow. Great people Tatiana, Markus, Andrei, Sergey, Vlad, Maria, Natalia, Alexey, Julia, Yury, Dmitry, Alex, Oleg, Maria and Katerina. We look forward to continued co-operation so we can visit Moscow more often in the future...after all, we visited the first time in 1985...y'all have come a long way, baby!!!


As always, we love to visit Bangkok. Thanks to the great people at The Oriental for working with us on the next Asia Offshore Association conference (27 - 29 September 2006) and all the Thailand-based speakers who will make this a truly exciting event. As the song goes, see you in September
THE REPORTS OF THE DEATH OF ASSET PROTECTION TRUSTS ARE GREATLY EXAGGERATED

Every year, one commentator or another opines that Asset Protection Trusts are dead. The pundits writing these obituaries normally are relying on one or several of the correctly decided cases like Laurence or Anderson where some foolhardy nut-job tried to push the limits of proper planning and got in trouble. Asset Protection Trusts work well. There are THOUSANDS (really 10's of thousands) of solid Trusts out there working just fine. These Plans were done when the financial seas were calm as part of solid financial plans and were done in such a way that the person who did them is able to comply with any order from any U.S. judge.

All of the bad cases involve either crooks, scoundrels or people who chose to retain so much control that they appeared to be abusers of the system. The settlors of these overreaching and inappropriate Trusts and their advisors were and are idiots who stretched the limits of common sense and got caught. All of these bad cases were decided correctly and do not stand for the proposition that Asset Protection Trusts are unethical or ineffective. If a person follows the Kinetic Asset Protection Trust model, he can sleep comfortably knowing that his assets are safe, and that he has done no wrong which can expose him to any material risk of facing down a contempt order.

I have hundreds of clients who have such Plans. Not one has ever lost a penny of protected funds to a creditor (many have settled suits for pennies on the dollar though because of their Plans) and not one has ever spent a day in jail. PERIOD. For the right person, Trusts work and work well. They are simple, straight forward and effective.

I have literally been through trial by fire with these types of Trusts. I have seen huge law firms with unlimited budgets go after my clients with no success. In all cases, my clients: 1) Did their planning when the financial seas were calm retaining sufficient assets in an unprotected environment to more than satisfy all known creditors, and 2) were well and truly out of a control position so that they had no power to move any assets at all. In all cases, my clients were represented by excellent law firms and behaved ethically. In each case, the clients have clean hands both before and after the Plans are implemented as a part of their normal financial/estate planning effort. I have been through several chapter 7 cases where the Trusts were disclosed and held up. Honestly, the good cases are not reported as there is no issue with the Trust at all.

Every single case where an appellate judge has held up a contempt order involving Asset Protection Trusts was decided correctly. Guys like Lawrence and the Andersons (who got to keep their money B.T.W.) are crooks who deserve worse treatment than they received by the judicial system. These guys do not deserve the benefits of Asset Protection, and they should end up in the jailhouse as they are essentially flicking the judicial system (and the individual judge reviewing their case) the bird. Judges are not stupid, and they hate to be told to go to hell.

Asset Protection works well when done right at the right time. Just like forming a corporation, LLC, LLP or even a pension plan. Some of these naysayers even go so far as to say that advocating Asset Protection Trusts is malpractice. To follow this position to the logical end, it should be malpractice for a lawyer to form a LLP to shield his assets from liability for the malpractice of his partners. Pure poppycock. Asset Protection Planning is both ethical and important. Asset Protection Trusts work and are alive and well.

It is certainly not malpractice to propose an Asset Protection Trust. In fact, I believe it is malpractice to fail to propose Asset Protection Planning (which may involve a properly done Kinetic Trust) when doing estate planning. Apparently, judging from the calls I get from estate planners, many agree.

WHEW. At least I am transparent and easy to figure out. Asset Protection in all forms is important and helpful. SIMPLE. Protect it or lose it.

Contributed by Robert Lambert, President, Asset Protection Corp
www.assetprotectioncorp.com
www.trustmakers.com

CHINA UPDATE

Qualified Domestic Institutional Investors (QDII)

On May 30, 2006, the China Banking Regulatory Commission (CBRC) approved 6 banks of QDII qualification, including four local banks: ICBC, China Construction, Bank of China and Communication Bank. The two foreign banks were HSBC and Bank of EastAsia. This approval allows these banks to assist local Chinese to invest in offshore capital markets.

Circular (2006) 37
To cool down the real estate market, the Chinese government issued a circular on May 30, 2006 (effective on June 1, 2006). The following points of the circular are of interest:

  1. If the house is sold within 5 years from the purchase date, the proceeds are subject to business tax.
  2. A property developer's paid in share capital must be more than 35% of the funds borrowed for projects.
  3. Developers may not refinance loans for developments with a high number of vacancies. No specific percentages are mentioned.
  4. If an entire development is vacant for 3 years, the developer cannot use the property as security for any loans.
  5. For mortgage loans issued to individuals, banks may only lend 70% of the purchase price.

Chinese SVA invest EUR1 billion in TV factory in Bulgaria
Chinese electronics company SVA has decided to invest close to EUR1 billion in a TV factory in Bulgaria's central city of Veliko Tarnovo. The SVA-BG factory would produce 100,000 colour TV sets per year, reports say. The Chinese money is the largest foreign investment in the region, reports say. TV-sets production will start in the fall, with 30 employees working on it in the beginning and 50 more joining in at a later stage. This is SVA's first investment on the continent. The Shanghai-based company has 42 factories in China and several more in the Republic of South Africa, Argentina and Pakistan.

Contributed by Borissov Law Office, Sofia, Bulgaria
www.borissov-law.com

Growing...
Based on World Bank's official measure in 2005, China has overtaken the United Kingdom as the world's fourth-largest economy. The leaders are the USA (1), Japan (2) and Germany (3).
SINGAPORE UPDATE

FOREIGN SOURCED INCOME
The 2006 Singapore budget provides that companies engaged in substantial business activities outside of Singapore that remit their foreign sourced dividends, foreign branch profits or foreign sourced service income to Singapore may be granted a tax exemption. Foreign income detailed in these circumstances must meet certain qualifying conditions to be exempt from tax, i.e. the taxpayer must be able to track the source of the foreign income, the Commissioner of Income Tax must be satisfied there is no "round-tripping" of Singapore sourced income via an overseas investment and the Singapore entity receiving the foreign income is not a "shell company". An example would be foreign sourced dividends received in Singapore that originate from a foreign tax jurisdiction which has a tax rate of at least 15% are exempt from Singapore income tax despite the fact no tax has been paid in the foreign jurisdiction.

Please visit www.iras.gov.sg for more information.
TAIWAN UPDATE

FOREIGN INVESTORS' DIVIDEND INCOME
Effective June 2006, an amendment to the Income Tax Law of Taiwan will subject all profit-seeking enterprises without headquarters in Taiwan to withholding tax on dividend income and earnings distribution income received from Taiwan profit-seeking enterprises, regardless of whether or not the profit-seeking enterprises without headquarters in Taiwan invests directly or through an established place of business in Taiwan. Tax will be withheld at source at either 20% (foreign investors approved by the Investment Commission of the Ministry of Economic Affairs to conduct business in Taiwan) or 25% (non-government approved foreign investors.

Please visit www.dot.gov.tw/en/index.asp for more information.
HONG KONG UPDATE

New and expanding regional operations reinforce Hong Kong's status as Asia- Pacific hub
Hong Kong has long been host to many of the world's leading companies looking to secure a foothold in the Mainland and Asian marketplaces. The city has gained increasing global recognition as a regional and international centre for finance and trade, and has attracted many of the world's largest companies as well as an ever increasing number of SMEs.

In 2005, foreign direct investment into Hong Kong reached US$35.9 billion, even higher than the robust US$34 billion in 2004 which was second in Asia and seventh in the world. These investors represent a variety of sectors, ranging from IT and technology to tourism and entertainment, transportation and logistics and financial, business and professional and trade-related services.

Hong Kong has become a two-way platform, a strategic entry point for business seeking to reach the Mainland, the Asia-Pacific region and global markets. It is also a logic place from which to manage Asian operations. Some 3,800 overseas and Mainland companies operate regional headquarters or offices in Hong Kong ---- and more are coming in every week.

Contributed by Invest HK, a government agency which promotes the many advantages of Hong Kong to the international community business. Please visit www.investHK.gov.hk
TIDBITS

The things that make us smile, frown and generally make life interesting...

Our monthly quote(s) that made us smile
"Sex without love is an empty gesture. But as empty gestures go, it is one of the best." Woody Allen
"If the British and the Americans had better taste, I wouldn't have to destroy so much of my wine." A French winemaker, who is the poster-boy for everything that is wrong with the French wine industry.

Madness...at least it only happens once every four years
We have been reading with complete confusion about the "Football" World Cup, aka "Soccer World Cup" (according to the Yanks), "a good game with lousy rules" (offside rule is nonsensical...just ask any FIFA ref) or "high school dating" (people bump into each other and sweat a lot but they rarely score...just like the matches). Some of the madness includes:

* 25,000 Hong Kong people (likely not one athlete in the group given Hong Kong's less than sporty attitude) sitting in an open area of a mall to watch their former colonial ruler win its opener against a country the name of which most Hong Kong people can't pronounce (we know we can't),
* EURO30 per night hostels being built all over Germany to house "hooligans" and "fans"...at that price, we wonder if there is a difference,
* an upsurge in revenues for prostitutes in Germany, which is much better than high school dating because EVERYONE scores, and
* stockmarkets in South America closing early or trading lightly on game day so fans can gamble on a different type of game for the day.
Madness...we wouldn't have it any other way Go China...oops, they didn't qualify.

Hmmmm....
We read with amazement about the 336 year old pig intestine condom on display in an Austrian museum inclusive of the Latin user's manual suggesting the little ditty be cleaned in warm milk to avoid diseases. And here we thought condoms, with or without warm milk AND definitely without alcohol, helped to avoid diseases.

The Stella Awwards...gotta love the Yanks
We were, as we do every year to ensure a good laugh at our culture's expense, reading the recently announced Stella Awards. Named after the famous Stella who successfully sued Mickey D's Lounge after spilling hot coffee on herself, the Stella Awards rank the most frivolous, ridiculous and successful lawsuits in the USA. Of particular interest is the fact we do not need to comment...these babies speak for themselves...

5th Place (tie): A lady in Texas was awarded US$80,000 by a jury after breaking her ankle when tripping over her son who was running around in a furniture store.

5th Place (tie): A 19-year-old Los Angeles' man won US$74,000 and medical expenses when his neighbor ran over his hand with a car from which the teenager was trying to steal the hubcaps!!!

5th Place (tie): A burglar in Pennsylvania was awarded USD500,000 for suffering "undue mental anguish" after locking himself in a garage of a home where the residents were away on holiday for eight days, thus requiring him to live on a case of Pepsi and a bag of dog food.

4th Place: A genius in Arkansas pulled down US$14,500 and medical expenses because the next door neighbor's dog bit his bum after he had scaled the fence to shoot pellets at the little pooch.

3rd Place: A Philadelphia restaurant had to fork out US$113,500 after a customer broke her tailbone when slipping on soda she had just thrown at her boyfriend with whom she was arguing.

2nd Place: A nightclub reveler in Delaware made away with USD12,000 and dental expenses when she knocked out her two front teeth falling from a bathroom window to avoid paying the USD3.50 cover charge.

1st Place: A lady in Oklahoma won USD1,750,000 and a new motor home when she put her now destroyed RV on cruise control so she could go to the kitchen to make a sandwich...the Owner's Manual failed to mention this would be a problem.

A doggie-dog world
We could not help but smile - knowingly - when reading about the dog owner who was a chaperone to his lil pooch for a birthday party...of another member of the "man's best friend" club. We have three "kids" in Hong Kong and two in Thailand. Butch, Spike and Gina, the Hong Kong "kids", are living large with a domestic helper, baths two times per week, a nice backyard in which to frolic, two square meals a day and no chores. Popeye and Caesar, the Thailand "kids", are living larger with two domestic helpers, baths three times per week, teeth brushed twice a week, a very big yard in which to frolic, two square meals a day and no chores. Yes, living large...but not inside the houses as we have confirmed with leading theologians that God intended houses for people, and backyards for doggies...so let it be written!!!

Free trade...be serious
We recently read the free trade bits of wisdom handed down by Pascal Lamy, director general of the World Trade Organization to various questions posed by unknowing global citizens. "Bi-lateral agreements", "investment rules" "labor standards", "social dumping"...Free trade? C'mon, be serious. Fair or managed trade, maybe. You want free trade...visit Shenzhen, China, baby...and beware for that which you wish

Mickey D's loung long march to Americanize China
We read with fear and loathing about McDonald's plan to launch a chain of drive-through fast-food outlets at 30,000 gas stations of Sinopec, China's biggest gas station operator. Mickey D's Lounge, more than any democracy-crazed journalist or human rights activist, seems to be leading the charge to Americanize China...we wonder...

No guns, please, we are Ameri...I mean Czechs!
We noticed with a certain sense of unease the no guns sign as we were passing through the immigration desk at the Prague airport. Here we thought only the Yanks had to be reminded of the issues of carrying weapons...the NRA love of guns seems to be growing like the cancer it is

The contents of the Global Consultants and Services Ltd's ("GCSL") Newsletter is for reference purposes only, and is provided by GCSL as a complimentary service. We have reviewed many different publications to compile this information, and we recommend that readers conduct due diligence before acting on any opinions mentioned herein. GCSL, its directors, officers, shareholders, employees, affiliates and agents do not warrant the accuracy or reliability of any information made available herein. In accordance with the Personal Data (Privacy) Ordinance, Chapter 486, of the Hong Kong Special Administrative Region of the People's Republic of China, we hereby inform you that we will discontinue sending our newsletter to you in the event you request we do the same.