Hong Kong
Sakura Consulting works with you to ensure you establish a business entity that fits your needs for Hong Kong. Below are the most common business entities in Hong Kong:
Limited Liability Company:
The most common business vehicle in Hong Kong is a Limited Liability Company. A limited liability company offers protection of personal assets from business risks and liabilities and is a separate legal entity.
Partnership:
This business structure allows two or more people to share ownership of a single business. Furthermore, partners share partnership responsibilities and have the ability to raise funds. However, partners are jointly and individually liable for the actions of the other partners. The most common form of partnership is a Limited Partnership, as it offers limited liability to limited partners.
Branch Office:
Non-Hong Kong companies wishing to operate in Hong Kong may register in the form of a branch office. The branch and its head office must be the same legal entity. The establishment of a branch is subject to the provisions of Part XI of the Companies Ordinance. Non-Hong Kong firms must have an office address in Hong Kong and must authorize a representative to take charge of its business. The authorized representative may be an individual, a law firm or a professional accounting firm, but should be a resident in Hong Kong. A branch must register with the Business Registration Office within one month from its date of commencement of business.
Representative Office:
When a foreign company wishes to analyze the suitability of the Hong Kong market for its goods or services, a representative office can be opened. A company establishing a representative office should register under the Business Registration Ordinance. This type of business entity is only permitted to carry on promotional and liaison work in Hong Kong. A representative office is prohibited from carrying on any business in Hong Kong or entering into any contracts in Hong Kong. Once the Representative Office starts conducting business generating activities, it is required to register under the Companies Ordinance.
Hong Kong Private Limited Company:
A foreign company may wish to incorporate a wholly-owned Hong Kong subsidiary as a Hong Kong company. One advantage of a subsidiary arrangement is that it limits the liability of the parent company in relation to operations carried on by the Hong Kong subsidiary. The subsidiary may be either a private company or a public company. Either type has unique advantages. The majority of subsidiary companies are private companies. Private companies are limited to a maximum of 50 shareholders, must have restrictions on the transfer of shares and may not issue shares in bearer form. Private companies are also subject to fund raising restrictions and must not engage in any activity that would require the lodgement of a disclosure document (e.g. a prospectus). A company may be incorporated with one member and companies which are not part of a listed group may have a single director. The directors of a Hong Kong company are not required to be Hong Kong residents. Every Hong Kong incorporated company must have a company secretary, who must be resident in Hong Kong.
