Overview of options when starting a business in Hong Kong
Hong Kong remains one of the world’s most open and efficient places to run a company. The city offers reliable institutions, modern infrastructure, a deep capital market, and a clear tax system. Its location gives direct access to Asian supply chains and a natural bridge to Mainland China.
Getting started begins with choosing the right structure. Below is a plain language overview of the main options available to foreign and local founders, along with when each option makes sense and the key setup steps.
Why choose Hong Kong
Hong Kong combines a stable legal system, straightforward company administration, and a competitive profits tax regime that taxes profits arising in or derived from Hong Kong. Banking, payments, and cross border logistics integrate smoothly with regional markets, which helps new ventures scale.
Main setup routes
Hong Kong private limited company
A private company limited by shares is the most common route for trading and investment. It is a separate legal person, offers limited liability for shareholders, and can sign contracts, hire staff, and open bank and payment accounts in its own name. Companies prepare annual financial statements and file required returns.
Good for startups, trading firms, service providers, and holding companies that want a clean local presence.
What setting up involves
- Name search and preparation of incorporation documents
- Filing with the Companies Registry and obtaining a Business Registration Certificate
- Appointing directors and a company secretary and setting a registered office
- Opening bank or payment accounts and setting up accounting and tax
Hong Kong limited shelf companies
A shelf company is a ready made private limited company that has already been incorporated and is available for immediate transfer. After purchase the new owners update directors and shareholders and may change the company name.
Good for projects that need a company very quickly while still meeting know your customer and compliance checks.
What setting up involves
- Selecting an available shelf entity
- Transferring shares and appointing officers
- Updating statutory registers and filings and arranging bank readiness packs
Branch office in Hong Kong
A branch is an extension of an overseas company. It is not a separate legal person and the parent remains liable for branch obligations. A branch carries out the same activities as the head office and pays Hong Kong Profits Tax on profits arising in or derived from Hong Kong.
Good for established companies that want to operate under the parent’s identity and balance sheet.
What setting up involves
- Registering the overseas company as a non Hong Kong company
- Obtaining Business Registration and providing a local registered office
- Maintaining branch records and making required statutory filings
Representative office
A representative office is a liaison presence for research, promotion, and partner contact. It has no separate legal status and cannot generate revenue, issue invoices, or sign sales contracts.
Good for market exploration before committing to a full trading vehicle.
What setting up involves
- Business registration for the representative office
- Setting internal policies that reflect permitted activities only
- Providing a business address and basic administration
Sole proprietorship and partnership
A sole proprietorship is owned by one individual and is not a separate legal person. The owner has unlimited personal liability and must obtain a Business Registration Certificate within one month of starting the business.
A partnership is owned by two or more persons who share profits. A general partnership does not limit liability for general partners, while a limited partnership includes at least one general partner with unlimited liability and one or more limited partners.
Good for very small operations where limited liability and external investment are not priorities.
What setting up involves
- Business name and Business Registration
- Basic accounting and Profits Tax filings
- Employer registrations if staff are hired
Offshore company to complement Hong Kong
Some groups use an overseas offshore company, for example in well known jurisdictions such as the British Virgin Islands or Cayman Islands, as a holding or international contracting vehicle alongside a Hong Kong operating entity. Modern rules require proper know your customer procedures and beneficial ownership disclosures, and economic substance rules may apply depending on activities and location.
Good for holding structures, investment vehicles, and specific cross border purposes when paired with local advice.
What setting up involves
- Selecting a suitable jurisdiction and registered agent
- Completing incorporation, beneficial ownership, and compliance checks
- Obtaining certified or apostilled document sets for banking and counterparties
How to choose the right route
Ask three questions to narrow your options.
- Do you need a local legal person that can contract and invoice
- Do you want limited liability that is separate from your personal or parent company assets
- How quickly do you need to start trading and what bank or payment access is required
If you need a full trading presence and limited liability, choose a private limited company or acquire a shelf company. If you want to test the market without selling, set up a representative office. If you are extending an established overseas business and want to keep everything under the parent, register a branch. Sole proprietorship and partnership suit very small or low risk ventures. Offshore entities can complement Hong Kong for holding and international structuring with proper compliance.
Key next steps after you choose
- Company secretary and registered office
- Business Registration Certificate and statutory books
- Bank or payment account onboarding and merchant setup
- Accounting system, payroll, and tax timeline
- Visas for owners or staff who need to relocate
If you would like, I can turn this guide into a downloadable checklist and a short comparison table for your site so visitors can self select the right structure and contact Prism for the next step.
Talk to Prism Hong Kong
Book a short consultation and get a clear plan for setup, timelines and costs. You will receive a tailored checklist, fixed fee proposal and a single point of contact who coordinates incorporation, banking, accounting and visas.
