Hong Kong: Investment vehicles


Costs

Companies

The application fee for incorporation for different company vehicles are as follows:

A business registration fee and levy are also payable to the Companies Registry. The business registration fee and levy are HK$2,000 and HK$250 for a one-year certificate, respectively, and HK$5,200 and HK$750 for a three-year certificate, respectively.

Companies with share capital

  • HK$1,720

Companies limited by guarantee

  • Members ≤25 – HK$170
  • Members >25 but <100 – HK$340
  • Members ≥100 – HK$340 + HK$20 per every additional 50 members (capped at a maximum fee of HK$1,025)


Branches of foreign corporations

To register a non-Hong Kong company, the following are required:

  • HK$1,425 for the issue of a Certificate of Registration of Non-Hong Kong Company, and
  • HK$295 lodgment fee (non-refundable).

If the non-Hong Kong company has yet to register its business under the Business Registration Ordinance, the prescribed business registration fee and levy must also be paid.

Partnerships

Limited partnerships must be registered at the Companies Registry, otherwise all partners will have unlimited liability as the partnership will be deemed to be a general partnership. The registration fee is HK$340 and an additional fee of HK$8 for every HK$1,000 or part thereof contributed by any limited partner.

Furthermore, there are also substantial costs of engaging lawyers in preparing the partnership agreement.

Trusts

For authorised unit trusts, an application fee must be paid to the Securities and Futures Commission.

The fees involved are:

  • HK$20,000 for a single fund,
  • HK$40,000 for an umbrella fund, and
  • HK$5,000 per sub-fund.

Once authorisation is granted, an authorisation fee and the first annual fee are payable. The authorisation fee and first annual fee are HK$10,000 and HK$6,000 for a single fund, HK$20,000 and HK$7,500 for an umbrella fund, HK$2,500 and HK$4,000 per sub-fund respectively.

Furthermore, there are also substantial costs of engaging lawyers in preparing the trust deed.

Typical time frame for setting up the vehicle

Companies

To facilitate the incorporation of a company, one must submit an incorporation form, the articles of association of the company and the incorporation fee. The certificate of incorporation and business registration certificate will generally be issued within one hour after submission of the application at the e-Registry.

Branches of foreign corporations

The certificate of registration will be issued at least 13 days after submission of all registration documents and payment of the registration fees to the Companies Registry.

Partnerships

Once the partnership agreement is executed, the partnership is operative. For limited partnerships, the certificate of registration will be issued around five working days after submission of all registration documents and payment of registration fees to the Companies Registry.

Trusts

A unit trust is operative upon authorisation from the Securities and Futures Commission, depositing of the trust property, collection of investor subscriptions and execution of the trust deed.

A discretionary trust is operative upon execution of the trust deed.

Governance and taxation

Companies

The incorporation of a private company in Hong Kong requires at least:

  • One shareholder (but no more than 50 shareholders, and they need not be Hong Kong residents);
  • One director (can be either an individual or a company and need not be a Hong Kong resident);
  • One company secretary (must be a Hong Kong resident); and
  • One auditor.

Each Hong Kong company must have a registered office in Hong Kong to which all official communications and notices, including service of process, may be addressed. The address of the registered office must be stated in the Incorporation Form filed at the Companies Registry.

Companies must also hold an annual general meeting within nine months (for a private company or a company limited by guarantee) or six months (for an unlisted public company) after the end of their accounting reference period.

Branches of foreign corporations

Non-Hong Kong companies must appoint an authorised representative, who will be responsible for accepting service of proceedings and notices in Hong Kong. This authorised representative must be either a resident in Hong Kong or a firm of solicitors or certified public accountants. Non-Hong Kong companies are required to continue having an authorised representative in place for at least 11 months from the date of cessation of business in Hong Kong.

Partnerships

Governance requirements for partnerships are determined by the partnership agreement, the Partnership Ordinance and the Limited Partnerships Ordinance.

Trusts

Governance requirements for trusts are determined by the trust deed. For unit trusts, there are additional requirements under the Code on Unit Trusts and Mutual Funds, which require the appointment of a custodian and management company.

Compliance costs

Companies

Hong Kong companies must file an annual return with the Companies Registry every year. A private company must file an annual return within 42 days after the anniversary of the date of its incorporation. A public company or company limited by guarantee must file an annual return within 42 days after the date of the company’s Annual General Meeting (if the financial year of a public company begins before 3 March 2014) or 42 days after the return date (if the financial year of a public company begins on or after 3 March 2014). The return date would be six months (for a public company) or nine months (for a company limited by guarantee) after the end of the company’s accounting reference period.

The filing fee for the annual return is HK$105 for a private company, HK$140 for a public company and HK$105 for a company limited by guarantee.

Public companies are subject to the additional requirement to submit their accounts with their annual return.

All companies also have to pay for engaging a company secretary, having a registered office, holding an annual general meeting and keeping accounts.

Branches of foreign corporations

Non-Hong Kong companies must also file an annual return with the Companies Registry every year. A non-Hong Kong company must file an annual return within 42 days after the anniversary of the date of its incorporation. The filing fee for the annual return is HK$180 for a non-Hong Kong company.

Partnerships

Limited partnerships must also file any changes to their registered particulars with the Companies Registry within seven days. It costs HK$26 to register a statement of changes to the particulars of a limited partnership. Additional costs will be payable for changes in the sums contributed by any (new) limited partner (HK$8 for every HK$1,000 or part thereof contributed by any (new) limited partner).

Trusts

Managing a trust involves annual administration costs, which may be payable to the management company depending on the type of trust. Unit trusts are subject to an annual fee payable to the Securities and Futures Commission.

A trust usually incurs annual administration costs, the amount of which will depend on the nature and activities of the trust. In the case of unit trusts, annual management fees and any performance related fees may also need to be paid to the management company. Unit trusts authorised by the Securities and Futures Commission must also pay an annual fee to the Commission. The amount of this annual fee is HK$6,000 for a single fund; HK$7,500 for an umbrella fund and HK$4,500 per sub-fund.

Tax

Companies

Companies only have to pay tax for profits arising or derived from Hong Kong.

Branches of foreign corporations

Branches of foreign corporation only have to pay tax for profits arising or derived from Hong Kong.

Partnerships

A partnership is treated as a separate legal person for profits tax and are assessed according to the Inland Revenue Ordinance. The assessed profits will be apportioned on the basis of the agreed profit-sharing ratio and taxed accordingly.

Trusts

Trusts are subject to profits tax, with the exception of unit trusts authorised by the Securities and Futures Commission which may be exempt from tax liabilities.

Updated on 1 February 2019.

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