Hong Kong is the record holder for the world’s most free economy for the last two decades. It is perceived as an ideal place to start a business.
Today, it’s among the global leaders economy in business and banking sector that offer gross benefits.
Additionally, Hong Kong is proud of an international economy spot with outstanding state support, including some tax incentives and advisory offices. It’s also among the least corrupt countries on the globe with readily available lively coworking spaces.
The process of starting a new company in Hong Kong is relatively easy and very cost-effective.
Unlike other nations, you can fully own your company, as the shareholder or sole director. This is due to friendly regulation capacities of the state, promoting the art of business.
Moreover, if you anticipate to expand your current business in other surrounding countries like China, Hong Kong is a great gateway to launch out with.
In this article, you’ll be guided on how to kickstart a profitable business in Hong Kong. Beyond that you learn:
- Common types of companies in Hong Kong.
- How to start a business in Hong Kong as a foreigner.
- Details of Hong Kong company formation.
- How long it takes to register a business in Hong Kong even if you are a foreigner.
- How to choose an interesting business name that can be easily approved in Hong Kong.
- Legal requirements that will keep your business safe and thriving in Hong Kong.
- Cost of Hong Kong company setup services.
- And why you should consider setting up a branch of your company in Hong Kong.
What Are the Common Types of Companies in Hong Kong?
The process of setting up a company in Hong Kong, and registering with the government varies depending on the type of business one would want to operate (sole proprietorship, a partnership or a corporation).
The most foreign business type is a limited company. This is the most common business type as it’s officially incorporated in the country.
A limited liability company enjoys the same tax benefits as resident businesses do. You can also utilize the free trade agreement with neighboring China.
However, for a corporation established in another country, you can use other options such as a branch or representative office.
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It is worthy to note that a limited company is an entirely separate legal entity from its owner.
It’s considered a legal person with its rights and must comply with provisions in the Companies Ordinance of Hong Kong.
A sole-proprietorship means you’re self-employed and a partnership would mean you and your partner must submit identification documents in addition to other forms for some legal considerations.
How to Register a New Company in Hong Kong
Regardless of the type of company, the first step is to visit the Business Registration Office but you can also remotely hire an incorporation company based in Hong Kong who will help you to register your business.
The office processes applications for incorporation of local limited companies and registration for foreign companies incorporated outside Hong Kong but already set in Hong Kong.
This is a mandatory legal step to consider.
What’s The Process Of Choosing A Name For My Business in Hong Kong?
Choosing a name for your business is the first and foremost step of starting a business in Hong Kong.
Carefully choose a name for your business and check its legal availability.
You can conduct a company name search for free with the Companies Registry’s Cyber Search Centre to make sure no other company is under the same name.
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What’s The Process Of Opening My Business In Hong Kong?
To process your application, which is quite a simple step, you need to register your business.
You can apply for incorporation of the local limited company, or registration for non-Hong Kong company incorporated outside the country but looking to stabilize a place of business in the country.
By submitting the above applications, the government assumes you have made a business registration application at the same time.
If your application is successful, the Companies Registry issues the business registration certificate and a certificate of incorporation or the Certificate of Registration of a Non-Hong Kong Company as per your application terms.
A registration fee of HK$2000 and protection of wages on insolvency fund levy of HK$250 applies.
Critical Company registration documents include:
- An incorporation Form for limited companies by shares(Form NNC1).
- Notice to Business registration office (form IRBR1).
- A copy of the company’s Articles of Association.
Download the necessary forms here https://www.gov.hk/en/business/supportenterprises/businesstopics/licensing.htm
How Long Does It Take to Open A Business in Hong Kong?
This is what many ask.
Online registration takes only an hour, assuming all your documents are in order. Registration by mail takes up to 4 business days.
The business also needs various government licenses, permits, certificates, and approval prior to starting operations in Hong Kong.
Familiarize with Hong Kong Government taxes. Also, very important is to understand various statutory obligations and duties to your employees as well as labor legislation for detailed information on employment protection and benefits for employees.
You will also need to take the necessary steps to protect and manage your intellectual property.
Lastly, open a bank account. Open a corporate bank account to keep your business transaction separate from personal transactions.
The process of starting a business in Hong Kong is relatively simple and opening a company will only take few days. From there, you will benefit from opportunities to increase your market shares in Asia, and much more.