2 March 2021
Against the backdrop of Hong Kong’s largest economic decline on record, the Hong Kong Financial Secretary announced on 24 February 2021 a series of stimulus measures focusing on stabilizing and reviving the economy in Hong Kong. One of the takeaways on the asset and wealth management side of things, is a plan to submit a legislative proposal in the second quarter of 2021 to allow foreign investment funds to re-domicile to Hong Kong.
Since the establishment of the two new fund structures in Hong Kong, namely the Open-ended Fund Company (“OFC”) and the Limited Partnership Fund (“LPF”), there has been a steady rise in newly set up OFCs and LPFs in Hong Kong, consolidating Hong Kong’s status as an international asset and wealth management centre. The legislative proposal will allow foreign investment funds to re-domicile to Hong Kong for registration as OFCs or LPFs. In particular for OFCs, there are also planned incentives in the form of subsidies to cover around 70 per cent of the expenses paid to local professional service providers (capped at HK$1 million per OFC) for OFCs set or re-domiciled to Hong Kong in the coming three years.
An Amendment bill to provide tax concessions for carried interest by private equity funds operating in Hong Kong. The current aim is to pass the bill within the current session for the tax concession to apply starting this year.
For further information, please contact:
Charing Yu, Associate, Hauzen LLP
info@hauzen.hk
