One of the nations with most progressive policies in the world is Hong Kong. It is a special administrative region of China and has most of its operations biased to encouraging investors to come to Hong Kong. In 2003, the Hong Kong Immigration Department introduced a new program (Capital Entrant Scheme) to help people who wanted to invest in Hong Kong get an entry. Before the scheme was introduced, people who wanted to get residence in return for investing in Hong Kong had to use parts of the Employment visa based on investment.
In this post, the Hong-Kong investor visa is looked at into details to establish its criteria, conditions for staying, and success of the visa.
This scheme involved allowing people entry and stay in Hong Kong if they made capital investments in already existing businesses without being directly involved in running them. The investor only identified an asset and invested a specific amount without becoming part of the business.
The capital investment Entrant Scheme was suspended in 2015 by the Hong Kong administration. Info on this scheme will be updated when the administration outlines the next action.
Business investment visas are given to applicants who qualify for them, and it takes about 2-3 months to process.
The bottom line to qualifying for a Business Investment Visa is being able to impact positively on Hong Kong economy significantly. How much capital will the business inject into the economy? What about job creation and the introduction of new technologies? The business must demonstrate that the local vendors will benefit and create a long-term sustainable relationship with huge economic benefits. The business may be in the form of Limited Company or a foreign corporation as outlined in the Hong Kong Company Ordinance. Hong Kong does not allow sole proprietorship or partnerships.
Once you have been issued with a Business Investment Visa, you can bring dependants such as children less than 18 years of age and spouse to stay for one year. After that, the stay can be extended for two years depending on the investment viability. Other conditions attached to the Business Investor Visa is staying free from criminal activities and generating economic activity to prevent becoming a burden to the Hong Kong Economy.
The applicant is required to pay a fee of HKD 135 and to complete form ID(E)936.
Since Business Investment Visa was established, it has had a huge impact on the economy of Hong Kong. Though the immigration department does not publish related statistics, the Director of Immigration Department hinted that about 300 Business Investment Visas are issued every year.
The following are the main differences between Business Investment Visa and Scheme
The main focus of the policy for the scheme is to attract and maintain foreign capital in Hong Kong. According to economic experts, the scheme has been faulted because such capital is already available in banks but only very little amount is available to businesses.
The scheme is also faulted because it caters to investors with no regard for his/her academic qualifications. They are given to the investor who does not engage directly in growing the economy. Because of this, Hong Kong residents have been complaining that it is desperate for investors but the scheme will only bring highly uneducated, unproductive but wealthy people.
Many people in Hong Kong argue that the scheme was made for wives of the wealthy elite from the mainland. Many inland investors consider the scheme an ideal method of rewarding their wives and the numbers have pointed to the same fact.
Under the scheme, the investor is required to inject USD 834,000 or HKD 6.5 Million in specific assets.
In contrast, the Investment Visa requires that you form and invest in a company at the cost of about USD 1,900 or HKD 15,000. If you decide to register a branch of a foreign company, the cost comes down to USD 1,500 or HKD 12,000. If you add on-going costs such as government fees, audit requirements, office, and secretary, the cost will rarely surpass HKD 20,000 in a year. As a result, the Business Investment Visa is by far a better model.
The requirements of good education background, demonstration of economic activity an applicant will be doing and company registration are not too burdensome. Unless an applicant wants to be passive while in Hong Kong, this is no doubt a better option.