Our recent webinar Gateway to Asia: Getting Started in Hong Kong and Singapore encouraged a lot of discussion. There were several interesting questions from attendees for HSP's Asia experts; here are some of the highlights, and answers:
How long does it take to establish an entity in Singapore and Hong Kong, respectively?
It takes about 2 weeks from the submission of the application to obtain the authorities’ approval. After the initial business license is approved, it takes another 2-3 weeks to set up a bank account, register the tax ID and register for the Hong Kong MPF and Singapore CPF scheme, respectively.
My company is in the business of manufacturing electronic components, with factories in China. Should I set up my regional HQ in Hong Kong or Singapore and why?
Due to the proximity of Hong Kong to China, and the existence of several economic agreements between Hong Kong and China, holding companies established in Hong Kong can enjoy some advantages over Singapore, such as reduced customs formality and preferential dividends tax rate (when remitted from China to Hong Kong).
How do Hong Kong and Singapore rank on the corruption perception index?
Based on a recent study, in 2011, Singapore was ranked 5th and Hong Kong 11th. This index considers many factors, such as transparency of governmental policies and enforcement, judicial transparency, etc.
What is the timing to obtain employment permits for foreigners? Are there any limits to the number of foreigners a company in Hong Kong or Singapore can hire?
Usually 4-6 weeks is the “standard” time it takes to obtain a work permit, assuming the permit is approved the first time. There are generally no limits to the number of foreigners who may be hired in Hong Kong or Singapore, although it is not advisable to have an office staffed by 100% foreigners and no locals, as the government may otherwise delay or deny the entity set up application.
How easy is it to make intercompany loans from Hong Kong to China?
Intercompany loans between Hong Kong and China entities follow the same requirements as those between other countries and China. The rules are comparatively more stringent in China than Hong Kong.