Why Hong Kong is the best place for Offshore Company Registration?

by Cheap Incorporation | October 12, 2023

Hong Kong has been around for over 150 years and has a fascinating history. It is widely regarded as one of the most important financial hubs in the world due to its unique geopolitical position. In fact, Hong Kong’s economy has grown so steadily that, according to the International Institute for Management Development’s (IMD) World Competitive Yearbook 2022, the city was ranked 5th out of 63 economies worldwide, making it a top-rated competitive financial city not only in Asia, but also universally. 

Free Market Principle 

Hong Kong is so appealing for foreigners to invest and incorporate their businesses, in addition to its comparatively low tax rate for onshore regime, a 0% taxation policy for offshore enterprises. Not to mention, Hong Kong has long advocated for the “free market principle,” which is an integral part of Hong Kong society, allowing anyone from almost any country to do business here; the three main pillars that uphold Hong Kong’s values as an international financial centre are trade freedom, monetary freedom, and government integrity. Furthermore, Hong Kong functions as a gateway city for foreigners operating businesses in China. This makes Hong Kong an even more appealing place for foreigner entrepreneurs because it perfectly serves as a platform that provides endless potential business opportunities between an emerging global superpower and the rest of the world; especially with the Chinese government’s “Belt and Road Initiative” heavily promoted in recent years, where foreign investment has been actively sought after.

No Foreign ownership restrictions

Hong Kong maintains no foreign ownership restrictions under the distinctive “One Country, Two Systems” framework. In comparison to our competitor, Singapore. The Singapore government requires a local Singapore director for foreigners to establish a firm there. Foreigners cannot own the entire corporation. HK, on the other hand, does not have this limitation; foreigners are permitted to own 100% of a HK corporation. Because of our established judiciary system, which allows Hong Kong to have its own currency, political, and legal systems, Hong Kong’s economy has been continually well-maintained. Our official languages are Chinese and English, with English serving as the preferred business language. This demonstrates our drive and strong ambition to become a world-class metropolis ideal for conducting business in. Furthermore, the International Institute for Management Development (IMD) has consistently ranked Hong Kong favourably as one of the world’s leading financial centres in four major categories: economic performance, government efficiency, business efficiency, and infrastructure. Aside from the areas listed above, Hong Kong is also ranked first in “Business legislation,” and is in the top three in “Public finance,” “Tax policy,” and “Global investment.”

Best Gateway into the Asia / China market 

Because of its geographical location, Hong Kong is only a few hours away from other Asian financial centres, making it highly convenient for overseas businesspeople and tourists to fully take advantage of the benefits it offers. Hong Kong enjoys the freedom of its independent legal system, free flow of information and capital, and rule of law under the “One Country, Two Systems” program; there is over a million local companies registered under the Companies Ordinance in 2022, and the number is increasing every year. Because Hong Kong is so popular, it is always the first choice for entrepreneurs. The Hong Kong administration, on the other hand, is always striving to extend its commercial partnerships with foreign countries. The Hong Kong government has successfully negotiated free trade agreements with a number of countries, including Australia, New Zealand, Chile, the European Free Trade Association (EFTA), and the Association of Southeast Asian Nations (ASEAN). By aggressively interacting with other countries to generate greater commercial links, Hong Kong helps to promote a positive image in terms of its friendliness in commerce operations and its overall perception to the rest of the globe.

Easy to register a Company in Hong Kong

Many people may wonder what the primary role of a company secretary is and what benefits there are for having one for their company.  According to Section 474 of the Hong Kong Companies Ordinance, having a company secretary is a legal necessity for company registration in Hong Kong. A company secretary is more than just an administrative function; they provide significant support to your company to ensure it runs smoothly even if you do not have a physical presence in Hong Kong. A company secretary’s main duty is to ensure the company they present runs smoothly without your physical presence in Hong Kong. Registering and sustaining an incorporated firm in Hong Kong can be difficult because many documents are required to be filed, as well as extensive research to better grasp the rules and regulations. Companies, for example, are obliged to pay the Business Registration Certificate renewal cost and complete the NAR1 form every year; however, because many people have a busy work schedule and may desire to save money, they frequently overlook such critical requirements. NAR1 must be filed within 42 days of its incorporation anniversary date. Late filing will result in a penalty with a late fine, which can be significant depending on how late you file the form.  In addition to that, the Hong Kong government will send four letters to your company annually from 2 departments, one from the Statistics Department and the other being the Inland Revenue Department. Not to mention, the Statistic Department and the Inland Revenue Department will each send several documents to your company respectively every year. This is where our service comes in, as we will provide our clients with a hassle-free company secretary service, with all relevant documents completed and submitted to the government in order for you to prevent from paying a potential hefty late fee. 

Hong Kong is an excellent location to establish a business because of our unparalleled advantages that few other cities in the world can match. It is a busy city with an abundance of activities to participate in, so if you are an open-minded person who enjoys challenges and adventures, Hong Kong is the ideal place for you to start your offshore company.

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