Company Registration in China and Company formation - Hong Kong Incorporation

Types of Companies in Hong Kong

a@b.com (admin) — Mon, 30 Mar 2009 09:56:22 +0800

Company

1 Company

A company can be incorporated by registration with the Companies Registry under the Companies Ordinance. Although there are different kinds of companies, more than 99% of investors set up their business by forming a private limited company (shown as private company in the following diagram) rather than by the other forms. There may only be one or two thousand public companies, but there are more than 500,000 private limited companies in Hong Kong.

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Setting up Business in Hong Kong

a@b.com (admin) — Mon, 30 Mar 2009 09:46:52 +0800

WHY INCORPORATE IN HONG KONG?

Hong Kong is a low tax jurisdiction with companies paying tax at the rate of 17.5％ on local profits. The Hong Kong Government is keen to promote Hong Kong as a regional centre for Asia and offers an exemption to tax for companies registered in Hong Kong but transacting its business outside of Hong Kong. The effect of the exemption is that qualifying companies can operate tax-free. In summary Hong Kong is an established and highly regarded jurisdiction, has not been blacklisted by any regulatory authority, benefits from low taxes and has developed into an efficient base for doing business in China and throughout Asia. Most importantly businesses can operate in Hong Kong and enjoy the tax benefits associated with most tax havens without creating the negative image commonly associated with being based in a tax haven.

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Hong Kong as an IPO Centre

a@b.com (admin) — Mon, 30 Mar 2009 09:45:47 +0800

Large initial public offerings are always welcomed in Hong Kong, particularly when they are successful, whether measured by the degree of over-subscription or the extent of the increase in the prices of the shares on their debuts. It is also a clear confirmation of the status of Hong Kong as an international financial centre. Last week we had the Industrial and Commercial Bank of China (ICBC) IPO, which is, so far, the largest IPO in the world. The fact that this IPO and several other large IPOs were organised so successfully in Hong Kong and not in London or New York, or any other international financial centre is something that those involved in the Hong Kong Stock Exchange, the investment banks, the banking system, and the interbank payment system can justifiably be proud of. I hope this is something that the Hong Kong community, including all the investors, will be proud of too. Having watched these events closely, I think the lack of excessive volatility in the interbank rates over the course of the IPO and the absence of any hiccup in the interbank payment system on the payment and refund days are quite an achievement.

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