Decide on a Company Type and Name
The first step involves deciding on a company type and name.
Different company types are available for different business requirements.
A Limited Company:
- This is the most common company type
- This is a company which is incorporated in Hong Kong
- Owners can take advantage of all the tax benefits and concessions available to any fully incorporated business
- They can enjoy benefits such as the Closer Economic Partnership Arrangement (CEPA), a free trade agreement with Mainland China.
A Branch Office of a Parent Company:
- This is for companies that are incorporated outside of Hong Kong and establish a place of business in Hong Kong
- They must register with the Companies Registry as a ‘Registered Non-Hong Kong Company’ within one month of establishment
- Unlike a subsidiary limited company, a branch office is not a separate legal entity from the parent and can leverage funds off the credit rating of its owner.
- They cannot engage in profit-making activities and can only fulfil limited functions
- They are useful for companies looking to explore the Hong Kong market before making a larger investment
- If a decision is made to enter into a transaction which creates a legal obligation, it must change the business to a limited company or branch office.
Limited companies incorporated in Hong Kong cannot have the same company name as those in the index of company names kept by the Registrar of Companies. You may conduct a company name search free of charge through the Companies Registry’s Cyber Search Centreor the Company Search Mobile Service.
Most limited companies incorporated in Hong Kong are private companies limited by shares.
A private limited company in Hong Kong requires at least one director who is a natural person and one company secretary. If the company has one director only, the sole director cannot also be the company secretary at the same time. If the company secretary is a natural person, he/she should ordinarily reside in Hong Kong. If the company secretary is a body corporate, its registered office or place of business should be in Hong Kong. A non-Hong Kong resident can be appointed as a director.
The registered office of the company must be situated in Hong Kong.
There is no requirement for shareholders to be Hong Kong residents. The sole shareholder can be a director of the company.
Significant Controllers Register
To enhance transparency of corporate beneficial ownership in order to fulfil Hong Kong’s international obligations, the Companies Ordinance requires a company incorporated in Hong Kong to obtain and maintain up-to-date beneficial ownership information by way of keeping a
Significant Controllers Register. The Register should be open for inspection by law enforcement officers upon demand.
There are minimum entitlements in place for Hong Kong employees. More information on entitlements such as statutory holidays, Mandatory Provident Fund payments, sick and maternity leave and severance and long-service payments can be found at the Employment Ordinance.
Employers are also obliged to take out the employee’s compensation insurance policies for their employees under the Employees’ Compensation Ordinance.
Company Bank Accounts
Before setting up a company bank account, be sure to register and incorporate your business as those documents will be required to support your bank account application. You will be advised by your bank on what other documents are needed.
When opening an account, keep in mind that Hong Kong banks usually require a minimum deposit. Your bank may also request the identity and residence information of all the company’s beneficial owners due to Hong Kong’s anti-money laundering guidelines.
More information about opening and maintaining an account from the Hong Kong Monetary Authority can be found here.
Hong Kong has a wide variety of premises to suit all sizes and types of businesses. At InvestHK, we can help you identify a prime business location or an appropriate rental model and connect you with relevant networks and service providers.