Malaysia Hotline: +603- 2141 8908
Low
tax regime, a spring-board to the Mainland China market, world-class
infrastructure, a free economy are some of the many factors that are attracting
increasing number of foreign investors and entities to setup their business
presence in Hong Kong.
A
subsidiary company, branch office and representative office are the three
business structures available for foreign companies who wish to establish a
presence in Hong Kong. The choice of the specific business structure will
depend on the foreign company’s business plans and goals. Most of the small to
midsize companies opt for a subsidiary or a representative office, while large
corporations opt for setting up a branch office.
Subsidiary company
A
subsidiary is essentially a private limited company incorporated in Hong Kong.
Hong Kong allows 100% foreign ownership of companies, which implies that you
can set up a wholly-owned subsidiary company in Hong Kong.
Setting
up a subsidiary is the most common and preferred option for most foreign
companies, as it provides limited liability and numerous tax advantages. A
subsidiary is a separate legal entity from its foreign parent company therefore
the liabilities of the subsidiary company do not extend to the parent company.
Additionally, locally incorporated companies can gain preferential access to
the Mainland China markets and benefit from the free trade agreement with
China.
Branch Office
A
branch office like a subsidiary is a legally incorporated entity except that a
branch office is treated as an extension of the foreign parent company and is
not a separate legal entity in its own right. This makes the foreign parent
company accountable and responsible for all the debts and liabilities of the
branch office. Like a subsidiary company, a branch office must be registered
with the Hong Kong’s Companies Registry.
Representative Office
Foreign
companies that wish to gain market insight, exposure and a better understanding
of the Hong Kong business environment before setting up a full-fledged office
can opt for establishing a representative office first. A representative office
cannot engage in profit making activities and is not treated as a legal entity.
It cannot sign or enter into any contracts, sign deals on behalf of the
company, raise invoices or letters of credit nor engage in trading activities.
The representative office has to restrict itself to promotion and liaison
activities, undertaking market research and coordinating activities on behalf
of the parent company.
Contact us
If you have further queries, please contact Tannet
24 hours Malaysia hotline：603-21418908;
24 hours Hong Kong hotline：852-27837818;
24 hours Hong Kong hotline：86-755- 36990589;
Email: mytannet@gmail.com
TANNET GROUP : http://www.tannet-group.net, http://en.tannet.com.my