The history of Hong Kong has worked to produce one of the best economies in the world. As an investor, this special administrative region of the People’s Republic of China is no doubt irresistible. It has an independent system of government with favorable tax regime, good financial system, and a great working environment. As an entrepreneur, the best way to enter Hong Kong is using a Business Investment Visa that allows applicants to enter and run their businesses based on their business ideas. Despite this being one of the best methods, only 300-400 visas are successful every year. This has left many people wondering why the few numbers of approvals yet Hong Kong is a business driven economy.
One of the key reasons for the low rate of approval is numerous mistakes in application. Over the years, Hong Kong has come to appreciate that in order to spur growth; people must be involved in direct business operations. Therefore, your application must convince the immigration department beyond reasonable doubt that the applicant will have a positive impact in Hong Kong. In this post, we review the main mistakes that people make and that you must avoid.
Poor understanding of Hong Kong economy
You cannot invest in an economy that you do not understand well. This is a fact that has shaped many decisions by the immigration department on whether a business investor visa should be approved. For example, if you want to invest in the transport industry, you must demonstrate a clear understanding of numbers such as current operators, competitors, and operational trends. If these are not clear to you, the immigration department will find it very difficult even if you have all the resources.
To avoid this mistake, it is very important to carefully review the Hong Kong Market and learn as much as you can. You Might even consider incorporating a Limited Liability company in the area of interest long enough before applying for the Business Investment Visa
Business plan that is inconsistent with the business projection
When many people hear about business plans, the first instinct is doing it theoretically. However, the plan must make your business idea to be felt by the immigration department. The immigration officers ask the best minds in the area you are investing in to make the assessment. Therefore, omissions and poor conclusions will easily be noted.
Do not simply talk good of the area you want to invest in, make the plan realistic. For example, an investor in the hotel industry could cite major problems experienced by top competitors and how he would address them. Take the business plan as a sole opportunity to make your argument. Here, there is no room for errors.
Not having an operational business in Hong Kong
Since the business investment visa was introduced, a crucial leverage is having your hands on a business that is already operational. If you lack an operational hand on the ground, it is very difficult to trust that you will honor the smart business plan. In fact, even if the experts who are called to assess your plan indicate it is a great one, the immigration department will find it very difficult to grant you the investment visa.
Because you have already decided to enter Hong Kong market, start a business by registering a limited liability company and inject adequate capital into it. When you finally submit a business investment visa, the immigration department will no doubt consider you compared to those who have never set foot there.
Difficulty in demonstrating that you can mobilize enough resources for the business
No investment can be viable without mobilizing adequate resources. The business plan you have drawn should form a permanent link to the resources you intend to use. Here, the immigrations department looks for missing links that show you might pull back, downsize or exit within a very short time. The financial experts can easily figure these out from the business plan and two-year profit and loss projections.
Here, you must demonstrate your entrepreneurial being in you. Use the financial statements to make anticipations such as market shocks and how you would raise additional resources to cushion the business.
Applying without approval of the current employer (for those holding working visa)
For foreigners working with an employment permit/work visa, applying for investment visa without seeking approval of the employer is a great mistake. The immigration department never disowns the rules it has created. Because the current working visa is tied to the sponsor, the immigration department will deny you the new visa and insist you continue with the current one.
The best thing to do is seeking approval of the current employer for a side business. If he approves of the idea, go ahead and start the business to make it easy to demonstrate that you are ready to invest and grow the economy. With a limited liability company already running, make sure to take the visa application as a new one to easily persuade the immigration department to grant you the business investment visa.