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Starting a Business in Hong Kong

While Hong Kong is renowned for being an easy and convenient place to start a business, entrepreneurs still need to know something about starting a business in Hong Kong. As a licensed trust or company service provider (“TCSP”), Eclat Accounting and Taxation Professionals Limited (“EATPL”) suggests that entrepreneurs start their businesses by forming a Hong Kong Private Limited Company because it offers a number of unique advantages:

1. Incorporating a Hong Kong Private Limited Company does not involve lengthy documentation. It is simple, quick and likely to be perceived as “legitimate”.

2. The cost of incorporation and annual maintenance is relatively low.

3. The shareholder’s liability of a Hong Kong Private Limited Company is only limited to the amount of paid-up capital.

4. There is no minimum requirement on paid-up capital.

5. There must be at least one individual director, but the number of shareholders may vary from 1 to 50.

6. Bearer shares are not allowed and at least one ordinary share must be issued on incorporation. The share can be freely transferred, subject to stamp duty charges.

7. One registered address in Hong Kong is required. The address must be a physical address. PO Box is not allowed.

8. Corporate Directors and Secretaries are allowed but the Corporate Secretary must have his/her registered office or a place of business in Hong Kong.

9. Offshore sourced trade profits and service incomes are not taxable under the Hong Kong territorial taxation system.

10. Under certain conditions, foreign tax credits are available for a Hong Kong Private Limited Company.

11. There is no tax on capital gain, dividend, interest, net worth and royalty.

12. A Hong Kong Private Limited Company can be listed when satisfying the listing rules of the Main Board or GEM.

Considerations for Foreign Entrepreneurs

Foreign entrepreneurs must take into account the following three points before they plan to register a Hong Kong Private Limited Company:

1. Foreign entrepreneurs are not required to be physically present at the time of company incorporation. But it may be necessary when opening a bank account.

2. There are no residency requirements for incorporating a Hong Kong Private Limited Company. Foreign entrepreneurs are free to be a sole shareholder and director of it.

3. Foreign entrepreneurs are free to operate a Hong Kong Private Limited Company from overseas.

Documents Required for Incorporating a Hong Kong Private Limited Company

1. A copy of the Articles of Association of the company

2. A copy of Hong Kong Identity Card / Passport (*) (A passport is only required for a non-resident individual shareholder and director) and residential address proof

3. A copy of Certificate of Incorporation and Articles of Association for corporate shareholders and directors

4. A duly completed incorporation form (specified form NNC1 for companies limited by shares and specified form NNC1G for companies not limited by shares) which includes information on the company name, registered address, particulars of shareholders, directors and the company secretary, a brief description of business activities, paid-up capital on incorporation, liability of shareholders and number of shares allotted to subscribers

Why Hong Kong?

Procedure on Intcorporating a Hong Kong Private Limited Company