Main Characteristics of a Company Incorporated in Hong Kong
General Background – Hong Kong is one of two of China’s unique administrative regions, the second being Macau. In the past, Hong Kong was part of the British colony, however since July of 1997 Hong Kong returned to be under China’s rule. According to the policy of “one state, two systems,” Hong Kong enjoys a greater measure of anonymity and continues to run an independent judiciary, local currency and its own customs and emigration policies that is conventional with other British colonies. The army and defense system and the diplomatic relations are under central government auspices located in Beijing.
Economy – Hong Kong has one of the most booming economies in the world. Hong Kong’s economy is based on international trade and is ranked as number ten in the world in trade volumes. Hong Kong also stands out in the banking sector with all the banking activities that are centered there. Many international companies that operate in markets in the Far East are based in Hong Kong. Hong Kong’s financial center is the 11th biggest center in the world. The GDP stands at $29,000 and the country is ranked at number 15 in the world, such that it is the wealthiest area on the continent for GDP per person. The official currency in Hong Kong is the Hong Kong dollar (HKD).
Tax – Hong Kong, as one of the leaders in finance and trade, is an excellent choice for registaring companies. The customary tax law in Hong Kong is territorial. Meaning that all profit derived from activity that is not in the Hong Kong realm is exempt from tax.
Confidentiality – Hong Kong is known for its confidentiality in business and banking. The names of the directors and shareholders appear with the local registrar. We offer the service of nominee shareholders and nominee directors for a higher level of discretion.
Name of the Company – All companies in Hong Kong must have a suffix at the end of the name. There is a ban on the following use of words in a name: bank, trust, trustees, insurance, security, savings, loans, trading room, university, municipality or any similar words in other languages. The name must not have any indication to the local or national authorities.
Shareholders – There must be at least one shareholder, private or a corporation. The shareholders do not have to be Hong Kong citizens. The names and details of the shareholders are listed with the local registrar such that one cannot offer bearer shares through a company incorporated in Hong Kong.
Directors – At least one director must be appointed, private or a corporation, and does not have to hold Hong Kong citizenship. Names and details of the directors are listed with the local registrar.
Financial Statements – A foreign company registered in Hong Kong must prepare financial statements through a local accountant. GBO provides this service. It is important to note that in most cases one may state that the company has no operations in Hong Kong thus exempting it from submitting financial statements.
Registering a Company in Hong Kong:
Most people register a company in Hong Kong as a private limited company. The advantage is it limits the shareholders’ responsibility. It is important to know that the Hong Kong Company Formation process takes about ten days. A foreign offshore company located in Hong Kong must have a local office with a local address. GBO supplies this service and also ensures registering the company with the local registrar.
Advantages of Incorporating a Company in Hong Kong:
- Gateway into China – one may trade and make transfers in the Yuan and the Dollar. China very much encourages the increase in use of the Yuan on the island. In addition, it is easier to conduct business from the island than from China.
- The tax plan is comfortable and lenient – company tax in Hong Kong is very lenient on local companies and is a major advantage over any other jurisdiction in Asia.
- There is an advanced and professional banking system – most bank accounts that are opened in Hong Kong accommodates all international activity while the manpower in the local banks is extremely competent and professional.
- Company Fomration in Hong Kong is done by remote in a quickly, professionally and discreetly way.