HONG KONG

General Business Information

900px-Flag_of_Hong_Kong.svgOccupied by the UK in 1841, the city-state of Hong Kong was formally ceded by China the following year; various adjacent lands were added later in the 19th century. Pursuant to an agreement signed by China and the UK on 19 December 1984, Hong Kong became the Hong Kong Special Administrative Region (SAR) of the People’s Republic of China on 1 July 1997. In this agreement, China promised that, under its “one country, two systems” formula, China’s socialist economic system would not be imposed on Hong Kong and that Hong Kong would enjoy a “high degree of autonomy” in all matters except foreign and defense affairs for the subsequent 50 years. [Source: CIA World Factbook]

Hong_Kong_Skyline_viewed_from_Victoria_Peak.jpegAs one of the world’s leading international financial centers, Hong Kong has a major capitalist service economy characterized by low taxation and free trade. The currency, Hong Kong dollar, is the eighth most traded currency in the world as of 2010. Hong Kong was once described by Milton Friedman as the world’s greatest experiment in laissez-faire capitalism, but has since instituted a regime of regulations including a minimum wage. It maintains a highly developed capitalist economy, ranked the freest in the world by the Index of Economic Freedom every year since 1995. It is an important center for international finance and trade, with one of the greatest concentrations of corporate headquarters in the Asia-Pacific region, and is known as one of the Four Asian Tigers for its high growth rates and rapid development from the 1960s to the 1990s. Between 1961 and 1997 Hong Kong’s gross domestic product grew 180 times while per-capita GDP increased 87 times over.

The Hong Kong Stock Exchange is the seventh largest in the world, with a market capitalization of US$2.3 trillion as of December 2009. [Source: Wikipedia]

Fast Facts

Capital

N/A

Time zone

HKT (UTC+8)

Area

426 sq. mi. (1,104 sq. km.)

Population

7,112,688

Climate

Subtropical monsoon

Official Languages

Chinese, English

Currency

Hong Kong dollar (HKD)

Government

Special Administrative Region of the People’s Republic of China

GDP per capita

$52,700

Labor force

3,873,000

Unemployment rate

3.1%

Main trading partners

China, Japan, US, South Korea, Taiwan

Weights and measures

Metric

International dialing code

+852

Internet domain suffix

.hk

Doing Business rating

2 (of 189)

Starting a business rating

5

[Source: The World Bank, Wikipedia, CIA World Factbook]

Establishing a Business

Types of companies

A Limited Company is the most commonly-used company type. This is a company which is incorporated in Hong Kong, which means that the owner can take advantage of all the tax benefits and concessions available to any fully incorporated business, including the Closer Economic Partnership Arrangement (CEPA), a free trade agreement with Mainland China.

Branch Office of Parent Company. If a company incorporated outside Hong Kong establishes a place of business in Hong Kong, it must register with the Companies Registry as a ‘Registered Non-Hong Kong Company’ within one month of establishment. Unlike a subsidiary limited company, a branch office is not a separate legal entity from the parent and can leverage funds off the credit rating of its owner.

Representative Offices cannot engage in profit-making activities and can only fulfill limited functions. They are useful if a company wishes to explore the Hong Kong market before making a larger investment. If the company decides to enter into a transaction which creates a legal obligation, it must change the business to a limited company or branch office.

Company names

For limited companies incorporated in Hong Kong, the company name must not be the same as a name appearing in the index of company names kept by the Registrar of Companies. You may conduct a company name search free of charge through the Companies Registry’s Cyber Search Centre or the Company Search Mobile Service.

Company structure

Most of the limited companies incorporated in Hong Kong are private companies limited by shares.

A private limited company in Hong Kong requires at least one director who is a natural person and one company secretary. If the company has one director only, the sole director cannot be the company secretary of the company at the same time. If the company secretary is a natural person, he/she should ordinarily reside in Hong Kong. If the company secretary is a body corporate, its registered office or place of business should be in Hong Kong. A non-Hong Kong resident can be appointed as a director.

The registered office of the company must be situated in Hong Kong.
There is no requirement for shareholders to be Hong Kong residents. The sole shareholder can be a director of the company. [Source: InvestHK]

Business Registration

LocationHongKongUnder the one-stop company and business registration service, any person who delivers an application for incorporation of a local company or an application for registration of a non-Hong Kong company will be deemed to have made a business registration application at the same time. The Companies Registry will issue the Certificate of Incorporation (or the Certificate of Registration of Non-Hong Kong Company) and the Business Registration Certificate in one go if the application is successful. Other businesses have to register with the Inland Revenue Department within one month of business commencement.

Online applications for company incorporation and business registration can normally be processed within one hour. If you deliver your application in hard copy form, the Certificate of Incorporation and Business Registration Certificate will normally be issued within four working days. If you submit your application for business registration in paper form, your business registration certificate will be issued in 30 minutes over the counter, or in two working days by post. [Source: InvestHK]

American Corporate Services offers experience and expertise for astute investors who wish to establish offshore businesses. Whether an investor wishes to immigrate or simply to establish a business entity, our network of professionals has the ability to advise, assist, direct and enable clients to understand and navigate the process for Hong Kong company formation.

Our services include everything you need for starting a new business in Hong Kong. In addition to helping to establish a Hong Kong business bank account, helping you set up your business to conform to Hong Kong accounting standards and to comply with Hong Kong taxes, we also offer boutique amenities such as Hong Kong secretarial services. We can even help you to create a Hong Kong virtual office that will appear to others as though you are actually in Hong Kong, even though you may be just about anywhere else on the globe at the time. Our business is making your investment a success..