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黑暗中的沙漠

Why Mainland Entrepreneurs Prefer Doing Business in Hong Kong?

  • Writer: 炒年糕的貓貓
    炒年糕的貓貓
  • Oct 23
  • 4 min read
Hongkong

According to data from the Hong Kong Census and Statistics Department, as of 2024, there were 9,960 companies in Hong Kong with parent companies located overseas. Among them, 2,620 were backed by Mainland China, ranking first by origin. What makes Hong Kong so uniquely attractive to Mainland entrepreneurs?

I. Six Core Advantages


1. Competitive Tax Regime

Hong Kong adopts a territorial source principle, taxing only profits derived from within Hong Kong. The corporate profits tax rate is highly competitive—8.25% on the first HKD 2 million and 16.5% thereafter. Compared to Mainland China’s 25% corporate income tax, a company earning HKD 5 million in annual profits can save over 30% in taxes by operating in Hong Kong. In addition, Hong Kong imposes no VAT, inheritance tax, or capital gains tax, further reducing overall operational costs.

2. Integrated Identity and Business Development Opportunities

Hong Kong’s talent admission programs provide entrepreneurs with a dual pathway for both residency and business growth. Through schemes such as the Quality Migrant Admission Scheme (QMAS), Top Talent Pass Scheme (TTPS), and Talent Admission Scheme, qualified individuals can efficiently obtain Hong Kong residency. Operating a business locally also increases the likelihood of visa renewal. Permanent residents enjoy 15 years of free education for their children, priority admission to international schools, and medical expenses up to 60% lower than those in Mainland China.

3. Free Flow of Capital and Currency Stability

The Hong Kong Dollar is pegged to the U.S. Dollar, ensuring long-term exchange rate stability and reducing currency risk. With no foreign exchange controls, funds can move freely across borders—enabling businesses to easily receive international payments and manage global capital allocations.

4. Diverse International Financing Channels

As the world’s third-largest financial center, Hong Kong hosts over 70 international banks and offers a wide range of fundraising options, including IPOs, bond issuance, and syndicated loans. Financing costs are generally 30–50% lower than in Mainland China. In the first three quarters of 2025, Hong Kong recorded 68 IPOs raising over HKD 180 billion, ranking first globally in total IPO proceeds—highlighting its capital market strength and vitality.

5. Comprehensive Government Grants and Support

The Hong Kong government provides extensive funding programs for SMEs, such as the BUD Fund and SME Export Marketing Fund, each offering up to HKD 1 million in subsidies. The Technology Voucher Programme (TVP) offers up to HKD 300,000 to support IT upgrades. Innovation hubs such as Hong Kong Science Park and Cyberport provide startups with workspace, equipment, and funding. Some R&D programs offer subsidies up to HKD 10 million for qualified technology projects.

6. Robust and Transparent Legal System

Hong Kong’s common law system, familiar to the global business community, ensures high transparency and world-class efficiency in dispute resolution.The Personal Data (Privacy) Ordinance is regarded as one of the strictest data protection laws globally, helping businesses mitigate compliance risks related to data breaches.Meanwhile, the Intellectual Property Department processes patent applications within 6–9 months—roughly 50% faster than in Mainland China—offering strong protection for innovation and technology enterprises.

II. Practical Guide to Setting Up in Hong Kong


Step 1: Obtain Legal Residency or Work Authorization

Mainland Chinese individuals must first secure valid residency or a work visa before establishing a business. Common pathways include:



Step 2: Register a Hong Kong Company

Once legal status is obtained, the next step is company incorporation.The process includes name search, drafting the Articles of Association, submitting incorporation documents, and obtaining a Business Registration Certificate.


Step 3: Open a Business Bank Account

After incorporation, founders should prepare the Certificate of Incorporation, Business Registration Certificate, Articles of Association, and identity documents of directors and shareholders to apply for a corporate bank account.Hong Kong’s mature banking system offers comprehensive financial services to support daily operations and cross-border transactions.

Conclusion

With its low-tax environment, international financial ecosystem, free capital market, transparent legal system, and integrated residency-business policies, Hong Kong serves as a strategic gateway for Mainland entrepreneurs.Whether expanding internationally, optimizing tax structures, or achieving global asset diversification, Hong Kong plays a pivotal role.


For Mainland companies seeking to “go global,” leveraging Hong Kong’s combined advantages through a systematic three-step approach — Residency → Company → Bank Account — offers a solid and sustainable path toward cross-border growth and long-term success.


Contact Us | Oceanus Strategic

Both residency planning and company setup involve detailed procedures and document preparation. We recommend seeking professional assistance. Oceanus Strategic, with over a decade of consulting experience, provides comprehensive solutions for individuals, families, and businesses worldwide. We take a client-centric approach, tailoring strategies that integrate immigration timing, business expansion, tax planning, and family needs — helping you build a sustainable and globally connected future.

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