For many companies, the benefits of Hong Kong company formation are apparent. A company that is registered in the territory can do much more than keep its books. It can also issue shares to its shareholders. It is referred to as “double-entry” or “insurance”. Various reasons make this preferable to most businesses.
Firstly, there is less paperwork involved. It means that you have more time to focus on your core business through an open company in HK. In the UK, it may take years to get things going. Whereas, in Hong Kong, you can register your company within three months. You will be able to get a solicitor and accountant on the job so that you can handle all the minutiae of incorporating your company.
There is also less chance of a conflict of interest. When you go through a formal company formation service in the UK or the US, there are often conflicts of interest between the different parties. When you establish an open company in Hong Kong, there is only one major party. It makes the process easier on all concerned.
Secondly, the rules governing Hong Kong company registration are much more restrictive. The area is home to many kinds of businesses. Therefore, if you have a product or service that is not regulated by the Chinese market, you cannot open a Hong Kong company. However, any business requires a limited liability protection agreement, a director and secretary, and all shares listed in the stock exchange.
Even one that is not registered requires at least one share for it to be considered valid. Suppose your company is comprised of just a few employees or a small number of shareholders. In that case, you can get around this problem by including a “sole proprietorship” clause in your Memorandum and Articles of Association. It will allow you to specify that shares of any kind are issued by the company and held exclusively by the company’s officers and shareholders. It will help you avoid the problem of shares being published and being held by different people.
Companies that issue shares also require that they get to approve or subscribe for them. In general, companies that issue shares also need to them before they issue any share of stock. For new companies and have not established a name in the market, getting subscribe orders for stock shares may take time. If your company is one of these, then getting an investor to invest in your company and getting your claims certified can take some time, primarily if the investor is not based in the country where your company is based.
Some investors may want to use their money to finance the business, but others may want to use it to earn profits by investing in your company. To find out what kind of investors are interested in your company, you should research the web and get the information you need. One way you could get information about interested investors is through company registration in Hong Kong. It is a database that can help you find information about the people or firms that have registered their businesses on a specific date.
You should know about the company registration Hong Kong as an immigrant: if the person or the firm is a non-immigrant, they will not be able to avail of the share financing option. However, the number of firms interested in this will increase as soon as an area’s economy improves. It is another way that you can find investors interested in your company’s shares.