Intercompany Management Fees Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Intercompany Management Fees Agreement

"I need an Intercompany Management Fees Agreement for our Hong Kong regional headquarters to provide strategic management and IT support services to our manufacturing subsidiaries in Asia, with a cost-plus markup structure and specific service level requirements."

Document background
The Intercompany Management Fees Agreement is essential for multinational corporations and group companies operating in Hong Kong that share management resources and services across entities. This document is typically used when one group company provides strategic, administrative, technical, or other management services to related entities. It must comply with Hong Kong's transfer pricing regulations, particularly the Inland Revenue Ordinance and DIPN 28, ensuring that fees charged reflect arm's length principles. The agreement is crucial for tax compliance, proper cost allocation, and maintaining transparent intercompany relationships. It should detail service scope, performance standards, fee calculations, and include necessary provisions for audit rights and documentation requirements to satisfy Hong Kong regulatory scrutiny.
Suggested Sections

1. Parties: Identification of the service provider and recipient companies

2. Background: Context of the agreement and relationship between the parties

3. Definitions: Key terms used throughout the agreement

4. Scope of Services: Detailed description of management services to be provided

5. Service Standards: Quality and performance standards for service delivery

6. Fees and Payment Terms: Fee calculation methodology, payment schedule, and invoicing requirements

7. Transfer Pricing Compliance: Provisions ensuring compliance with transfer pricing regulations and arm's length principles

8. Term and Termination: Duration of agreement and termination rights

9. Confidentiality: Protection of confidential information exchanged during service provision

10. Intellectual Property: Ownership and usage rights of IP created or used in service delivery

11. Liability and Indemnification: Allocation of risks and responsibilities between parties

12. Force Majeure: Provisions for handling unforeseen circumstances

13. Governing Law and Jurisdiction: Specification of Hong Kong law and jurisdiction

14. General Provisions: Standard boilerplate clauses including notices, amendments, and entire agreement

Optional Sections

1. Personnel and Secondment: Include when services involve staff secondment or dedicated personnel arrangements

2. Data Protection: Include when personal data will be processed or transferred between parties

3. Tax Gross-up: Include when there may be withholding tax implications requiring gross-up provisions

4. Service Level Agreement: Include when specific performance metrics and KPIs need to be measured

5. Audit Rights: Include when regular auditing of services or costs is required

6. Non-Competition: Include when protection against competition between group companies is needed

7. Cost Allocation: Include when complex cost sharing or allocation methodologies are used

Suggested Schedules

1. Schedule 1 - Services Description: Detailed breakdown of management services to be provided

2. Schedule 2 - Fee Calculation: Detailed methodology for calculating management fees

3. Schedule 3 - Service Levels: Specific performance metrics and service level requirements

4. Schedule 4 - Key Personnel: List of key personnel involved in service delivery

5. Schedule 5 - Transfer Pricing Documentation: Required documentation to support arm's length nature of fees

6. Schedule 6 - Cost Allocation Methodology: Detailed breakdown of cost allocation principles and calculations

7. Appendix A - Form of Invoice: Standard format for invoicing

8. Appendix B - Reporting Requirements: Templates and requirements for service reporting

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Financial Services

Manufacturing

Technology

Real Estate

Retail

Professional Services

Healthcare

Telecommunications

Logistics

Consumer Goods

Energy

Media and Entertainment

Relevant Teams

Legal

Finance

Tax

Treasury

Compliance

Corporate Secretarial

Accounting

Internal Audit

Operations

Shared Services

Relevant Roles

Chief Financial Officer

Head of Legal

Tax Director

Group Financial Controller

Company Secretary

Transfer Pricing Manager

Treasury Manager

Financial Planning Manager

Legal Counsel

Compliance Officer

Group Operations Director

Head of Shared Services

Management Accountant

Corporate Finance Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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