Create an Offshore Company in Hong-Kong

by Shames P. Global Business advisory

Hong Kong is a top financial hub and at the same time one of the most competitive economies in the Asia-Pacific Region occupying top positions in the most prestigious surveys in 2016. Among these, the Global Competitiveness Index and the Ease of Doing Business Report placed Hong Kong among the first countries in the world in terms of economic development.

Foreign investors looking to open a company in Hong Kong have the liberty to choose between a numbers of types of business structures. Out of the available ones, the most common one is the Hong Kong limited liability company. This is also the one used to open offshore companies in Hong Kong.

Our specialists in company formation in Hong Kong can help foreign investors who want to incorporate any type of company in this jurisdiction.

Business forms in Hong Kong

Company incorporation in Hong Kong is simple across all of the available types of companies and understanding their characteristics and differences is important before deciding to invest here.

There are several types of business forms that can be incorporated in the Special Administrative Region. Below, you can see their description presented by our team of agents who specialize in company registration in Hong Kong:

Limited liability companies: these can be public or private and they are separate legal entities; the founders are thus protected against business risks and have limited liability.

Sole trader: the simplest business form and also the one with the highest degree of liability; it is incorporated by a single individual.

Partnership: a business structure formed between two or more partners in which at least one of them has full liability.

Foreign investors can also open branches or representative offices in Hong Kong.

Investors who wish to know more about the available business forms can reach out to our agents. The corporations, in either the form of a private or a public company, are the ones that are available to purchase as shelf companies and they are the business forms that are used by investors who wish to open an offshore company in Hong Kong.

Small and medium companies are set up in the form of the private limited company – the most widely used business form. Investors who wish to purchase a shelf company should also know that this is the business form most often offered for purchase. The advantages of a private limited company are the following: separate legal entity and limited liability for the founders as previously stated, ease of raising capital and ease of transfer of ownership, perpetual succession and an overall positive business image because limited companies have more credibility compared to sole trader or partnerships.

The company has a share capital which is divided into shares that correspond to a certain class, as defined in the Articles of Association. In the case of business failure, the shareholders will lose their investment, meaning that they will lose the shares they own in the company. As long as the company is profitable, the shareholders are entitled to share these profits in the form of received dividends.

Investors who are interested in company formation in Hong Kong will start by choosing their preferred business structure. Some of the questions that can be answered when making this decision include the following: what is the purpose of the business? What is its size? How much capital is available for starting the business? What is the degree of liability for the founder?