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Global Expansion Handbook

Hong Kong SAR, China

An international finance, trade and shipping centre whose common law, free capital flows and simple low taxes make it a regional HQ, holding and financing platform for Chinese companies going global. The Companies Registry handles incorporation online with simultaneous business registration; profits tax 16.5% (two-tier), no VAT or dividend withholding.

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Handbook
Updated 2026-11-13
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01Overview

Region
East Asia & Oceania
Capital
—
Currency
HKD
Languages
Chinese, English
ISO code
HK / HKG

Jurisdictions

  • Hong Kong SAR — Hong Kong SAR

China's direct investment

China's 2025 FDI flow
1374.7 USD 100m
End-2025 FDI stock
20350.8 USD 100m
Flow rank
#1 by flow

Source：2025 Statistical Bulletin of China's Outward Foreign Direct Investment ↗ · Flow is for calendar 2025; stock is at end-2025. Flow rank is from Table 8 (top 20); other countries from Annex Tables 1–2 (originally USD 10k, converted to USD 100m; one decimal, two below 1). A negative flow means divestment exceeded new investment that year.

Macro indicators such as GDP and population will be added from the World Bank in the data release (P1).

02Market Entry

Foreign ownership

Whether 100% foreign ownership is generally allowed, and key exceptions. Allowed / conditional / not allowed / unverified.

Foreign and local investors are generally treated alike; very few sectors are restricted

Applies to
Gambling is tightly controlled; broadcasting, telecoms and finance need licences
Jurisdiction
Hong Kong SAR
Source
MOFCOM
Local SubsidiaryIncorporate a separate legal entity in the target country Direct ExportSell goods from your home entity directly to overseas buyers Digital / Service BusinessSoftware, SaaS, AI and professional services abroad

03Business Formation

Common legal entity

The company form most commonly used by foreign investors for a local operating entity.

Private company limited by shares

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
Companies Registry

Registration authority

Primary authority for company or commercial registration.

Companies Registry

Applies to
Online filing available
Jurisdiction
Hong Kong SAR
Source
Companies Registry

Foreign ownership

Whether 100% foreign ownership is generally allowed, and key exceptions. Allowed / conditional / not allowed / unverified.

Foreign and local investors are generally treated alike; very few sectors are restricted

Applies to
Gambling is tightly controlled; broadcasting, telecoms and finance need licences
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Local director / representative

Whether a locally resident director, manager or representative is required.

No resident director requirement; at least one director must be a natural person

Applies to
The company secretary must be a Hong Kong resident or a Hong Kong body corporate
Jurisdiction
Hong Kong SAR
Source
Companies Registry

Local registered address

Whether a local registered address or premises is required at incorporation.

A registered address in Hong Kong is required

Applies to
A corporate service address may be used if it can receive statutory documents
Jurisdiction
Hong Kong SAR
Source
Companies Registry

Beneficial ownership register

Whether companies must keep or file ultimate beneficial owner information.

Must keep a significant controllers register (not filed with the Companies Registry)

Applies to
Kept in Hong Kong for inspection by law enforcement
Jurisdiction
Hong Kong SAR
Source
Companies Registry

Foreign-entity setup flow

Main approval stages for a foreign investor setting up an entity (no time estimates).

Incorporate via e-Registry with simultaneous business registration → open a bank account → profits tax filings with the IRD

Applies to
Excludes processing time estimates
Jurisdiction
Hong Kong SAR
Source
Companies Registry

04Taxation

Headline corporate income tax

Statutory headline rate for ordinary companies, before incentives, exemptions, thresholds or special regimes. Always read with the conditions.

16.5% (profits tax)

Applies to
Two-tiered: first HK$2m of assessable profits at 8.25% for corporations; only Hong Kong-sourced profits are taxed
Jurisdiction
Hong Kong SAR
Source
Inland Revenue Department

Indirect tax (VAT / GST / SST)

Standard rate and type of VAT, GST or sales & service tax.

No VAT or GST

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
Inland Revenue Department

Tax authority

Authority responsible for corporate tax registration and filing.

Inland Revenue Department

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
Inland Revenue Department

Dividend withholding tax (non-residents)

General withholding on dividends paid to foreign shareholders, before treaty relief.

No withholding tax on dividends

Applies to
Hong Kong also does not levy profits tax on dividends
Jurisdiction
Hong Kong SAR
Source
Inland Revenue Department State Taxation Administration

Tax treaty with China

Whether a double taxation agreement with China is in force. Rates and conditions per the treaty text.

In force (Mainland–Hong Kong double taxation arrangement)

Applies to
Terms per the arrangement text and STA publications
Jurisdiction
Hong Kong SAR
Source
State Taxation Administration (China)

05Banking & Payments

Exchange controls

Whether general exchange controls or cross-border fund rules apply.

No exchange controls

Applies to
Funds move freely; cross-border cash or bearer instruments above HK$120,000 must be declared
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Banking & financial regulator

Primary regulator for banking and foreign exchange.

Hong Kong Monetary Authority

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
MOFCOM

06Employment

Foreign employee work permit

Main permit types needed for foreign employees to work legally.

Employment visa from the Immigration Department

Applies to
Mainland residents apply under the Admission Scheme for Mainland Talents and Professionals; others usually under the General Employment Policy
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Labour & work permit authority

Authority for labour rules and foreign employee work permits.

Labour Department

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
Labour Department

Social security contributions

Main employer social security schemes for local and foreign employees.

Mandatory Provident Fund (MPF)

Applies to
Employer and employee each contribute 5% of relevant income (capped); expatriates staying 13 months or less or covered by an overseas scheme may be exempt
Jurisdiction
Hong Kong SAR
Source
Mandatory Provident Fund Schemes Authority

07Trade & Customs

Customs authority

Authority for import/export clearance and tariffs.

Customs and Excise Department

Applies to
Hong Kong is a free port; most goods carry no tariff
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Main free trade agreements

Main regional and bilateral trade agreements relevant to Chinese exporters (not exhaustive).

Mainland–Hong Kong CEPA and nine free trade agreements

Applies to
Ordinary companies
Jurisdiction
Hong Kong SAR
Source
MOFCOM

08Investment & Manufacturing

Investment authority / agency

Body responsible for approving, registering or promoting foreign investment.

Invest Hong Kong (InvestHK)

Applies to
Under the Commerce and Economic Development Bureau; investment promotion and landing support
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Free zone / SEZ regime

Whether free zones or special economic zones operate under rules different from the mainland.

The whole territory is a free port; no separate special economic zones

Applies to
No customs duty except on tobacco, liquor, hydrocarbon oil and methyl alcohol
Jurisdiction
Hong Kong SAR
Source
Customs and Excise Department

09Digital & IP

IP office

Authority for trademark and patent filing and registration.

Intellectual Property Department (trademarks, patents, designs)

Applies to
IP protection is territorial
Jurisdiction
Hong Kong SAR
Source
MOFCOM

Personal data protection law

Main law and regulator governing collection, use and cross-border transfer of personal data.

Personal Data (Privacy) Ordinance (Cap. 486)

Applies to
Supervised by the Privacy Commissioner for Personal Data
Jurisdiction
Hong Kong SAR
Source
Office of the Privacy Commissioner for Personal Data

10Compliance & Risk

New York Convention party

Whether the country is party to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which affects enforcing foreign arbitral awards locally.

Yes

Applies to
China extended the Convention to the Hong Kong SAR; foreign arbitral awards can be enforced under it
Jurisdiction
Hong Kong SAR
Source
UNCITRAL

Live risk monitoring

Geopolitical, conflict and trade-route risk events for Asia-Pacific, monitored by our sister site Global Risk Monitor.

View Asia-Pacific risk monitor

Global Risk Monitor · Geopolitical and trade-route risk monitoring

11Step-by-Step

Main setup steps in Hong Kong SAR, China

  1. 1Incorporate via e-Registry with simultaneous business registration
  2. 2open a bank account
  3. 3profits tax filings with the IRD
General checklist (setting up a subsidiary)
  1. Decide model and jurisdiction
  2. Confirm licences
  3. Prepare documents
  4. Incorporate
  5. Register for tax
  6. Open bank account
  7. Obtain operating licences
  8. Start operations

Steps follow the setup-procedure fact on this page, without times or fees; rely on the official sources.

12Official Resources

Chinese official resources

Country materials from MOFCOM, the State Taxation Administration and China's overseas commercial offices

Official guides are long Chinese-language PDFs updated on the publishers' schedules. Our structured facts cite local authorities as primary sources; use these guides to cross-check.

Local authorities