How to Open a Company in Hong Kong: A Complete Guide for Foreign Entrepreneurs

Hong Kong is one of the world's leading financial centers, offering a dynamic business environment, low taxes, and ease of establishment for foreign businesses. For foreign entrepreneurs looking to expand internationally, Hong Kong is a strategic choice. In this guide, we explain step by step how to open a company in Hong Kong and the benefits of doing so.

Why is Hong Kong the Ideal Destination for Foreign Businesses?

• Favorable Taxation: Hong Kong follows a territorial tax system, meaning that profits earned outside Hong Kong may be tax-exempt. The corporate tax rate is only 8.25% on the first HKD 2 million of taxable profits and 16.5% on the remaining taxable profits.

• Ease of Business Registration: The business registration process is fast and straightforward, often completed within a few days.

• International Business Environment: Hong Kong has a world-class financial infrastructure and direct access to the Asian market, facilitating internationalization. Additionally, all company documents can be prepared in English.

Step-by-Step Guide to Opening a Company in Hong Kong

1. Choose a Company Name: Check the availability of the name with the Hong Kong Companies Registry.

2. Define the Corporate Structure: A subsidiary can be 100% owned by the foreign company, with a director (who can be a foreigner).

3. Register with the Hong Kong Companies Registry: The process is efficient, and the company can be established within a few days.

4. Obtain the Business Registration Certificate: A mandatory document to operate legally in Hong Kong.

5. Open a Corporate Bank Account: Some institutions require physical presence, but online accounts are possible.

6. Obtain Necessary Licenses and Permits: Depending on the business sector, specific licenses may be required.

Branch, Subsidiary, or Representative Office? What’s the Best Option for Foreign Businesses?

• Branch: Unlike other markets, Hong Kong requires foreign companies to have a local registration to operate. This means that a foreign company cannot simply open a branch; it must establish a legally registered entity in Hong Kong, such as a subsidiary.

• Subsidiary: A separate legal entity, highly recommended for foreign businesses. It allows legal separation, tax optimization, and has a broader scope of operations.

• Representative Office: An option for those who only wish to conduct market research and provide support services without engaging in commercial activities. However, due to bureaucratic hurdles and operational limitations, most foreign businesses opt for a subsidiary.

To learn more about the different types of companies in Hong Kong, read this article we wrote on how to decide which type of company to open in Hong Kong.

Legal and Accounting Obligations

• Maintaining accounting records and undergoing an annual audit.

• Compliance with the Companies Ordinance and Inland Revenue Department (IRD) regulations.

How Can Brasia Limited Help?

At Brasia Limited, we assist foreign businesses in the complete process of opening subsidiaries in Hong Kong, from registration to accounting and tax compliance. Our specialized team ensures a fast, secure, and efficient process.

Conclusion

Expanding to Hong Kong can be a significant step towards international success. With low taxes, an easy registration process, and access to the Asian market, Hong Kong is a strategic destination for foreign businesses. Contact Brasia Limited today and start your business journey in Asia!