Benefits of registering a non-Hong Kong company as a branch office
According to the statistics released by the Companies Registry in January, a total of 145,053 local companies were newly registered in 2024. By the end of 2024, the total number of local companies registered under the Companies Ordinance was 1,460,494, increasing by 29,736 compared to 2023, which was an all-time high figure.
There were also 1,079 non-Hong Kong companies – branch offices – that established a place of business in Hong Kong and were registered under the Companies Ordinance in 2024. By the end of last year, the total number of registered non-Hong Kong companies was 15,126, up 2% compared to 2023 which was also an all-time high figure.
Registering a non-Hong Kong company as a branch office in Hong Kong can, under certain circumstances, offer distinct advantages to incorporating a new Hong Kong company.
A branch office provides direct access to the Hong Kong market and its potential customers but is regarded as an extension of the parent company and is not a separate legal entity. The parent company is therefore fully liable for the debts and liabilities of a Hong Kong branch and, generally.
A branch office is generally subject to the same legal and tax consequences as a company incorporated in Hong Kong but is only required to comply with limited provisions under the Hong Kong Companies Ordinance and may offer the following benefits:
- Simplified set-up – compared to setting up a wholly-owned subsidiary, establishing a branch office can be a quicker and less complex process.
- Cost-effective – branch offices can be more cost-effective than subsidiaries, especially in terms of initial set-up costs.
- Stronger brand presence – operating under the same name as the parent company can enhance brand recognition and credibility in Hong Kong.
No stamp duty is payable in Hong Kong on the transfer of shares held in the foreign company which operates a branch in Hong Kong. There is no requirement for a separate audit and the business operation of a branch can be terminated easily by notifying the Hong Kong Companies Registry that it has ceased to have a place of business in Hong Kong.
A branch office must be registered with the Hong Kong Companies Registry as a non-Hong Kong company that has established a place of business in Hong Kong under Part 16 of the Companies Ordinance. This must be done within one month of establishing the place of business in Hong Kong.
The registration form should include the following particulars of the foreign company:
- Name.
- Place of incorporation.
- Date of establishing the place of business and its address.
- Address of principal place of business in Hong Kong.
- Identity of company secretary and directors, together with dates of appointment and particulars.
- Identity of a local ‘authorised representative’ appointed to accept service of process.
- Details of the registered office and principal place of business overseas.
The form must be accompanied by certified copies of the foreign company’s constitutional documents, a certificate of incorporation, a completed Notice to Business Registration Office and its most recent published financial statements. The latter requirement is waived if it is not also required under the law of the foreign company’s place of incorporation, or if the company has been incorporated for less than 18 months and has not yet published financial statements.
Upon approval, the Hong Kong Companies Registry will issue the Certificate of Registration of Non-Hong Kong Company and the Business Registration Certificate. Following registration, a foreign company is obliged to keep the Hong Kong Companies Registry and Business Registration Office updated of certain changes. It should also file an annual return, supported by the most recent financial statements, where applicable.
A foreign company must maintain the appointment of an authorised representative for as long as it maintains a place of business in Hong Kong, and for a further year after it ceases to have a place of business in Hong Kong.
