China and Hong Kong maintain a very close business relation, despite the differences between their business regimes and the fact that the Mainland is opening up to the world more in recent years. Hong Kong is an important business hub in Asia and many foreign investors open a Hong Kong company
to use it as a springboard for their business activities and investments in the Mainland.
Hong Kong, an important business link to China
Hong Kong’s history as a British colony shaped its future but did not cut the city off completely from the Mainland. The Special Administrative Region celebrated its 20 year anniversary as being handed over to China once more and on the eve of this event, business specialists questioned the evolution of the relation between the two jurisdictions.
While China is opening itself up more to the rest of the world and had even surpassed Hong Kong in some areas (for example, the Shanghai and Shenzhen ports are ranked above the Port of Hong Kong), the city is still a gateway to and from China.
Company formation in Hong Kong
thought to be more straightforward compared to that in China, mainly because English is also an official language but also because of the pro-business environment and low taxes.
Hong Kong – China relations
Hong Kong remains a key hub for investment flows to and from the Mainland. Experts emphasize the fact that Hong Kong has a more profound understanding of doing business with the West and this is evident in the investors’ preferences. Moreover, Hong Kong has a high degree of autonomy under the one country, two systems framework and its laws are different as far as foreign investments are concerned.
China and Hong Kong have signed a double tax treaty
: an agreement that allows for double taxation relief for those companies that derive income both from the Mainland and the Special Administrative Region.
Our company formation agents in Hong Kong can help answer any questions regarding the taxation of companies that do business in both jurisdictions.
if you want to know more about opening a Hong Kong company and expending the business activities to China.