Foreign business in Hong Kong: the legal framework.

Abstract

The aim of this thesis is to provide a legal framework for foreign investors that want to do business in Hong Kong, describe foreign investments in the area and explain Italian commercial and tax relations. Hong Kong’s legal environment is still influenced by the English Common Law and, under the principle of "one country, two systems", it differentiates its political and economic system from China. Except in military defence and foreign affairs, Hong Kong has independent executive, legislative, and judiciary powers. It is one of the most significant financial centres and the world’s freest economy, thanks to the implementation of a prudent economic policy within a transparent legal environment and a high level of market openness. Chapter 1 gives a business framework to foreigners who want to do business in Hong Kong: the Common Law influence, the sources of law as well as the commercial law. After a brief illustration of the Companies Ordinance, I explain the characteristics of the entity types foreigners can choose. Then, I provide a description of the tax system. Chapter 2 is the core of this thesis: foreign investments. I describe law, regulations and restrictions to foreign investments but also incentives. Other important aspects illustrated in this chapter are Hong Kong’s participation to international agreements, the most common forms of business vehicles and the main sectors that can provide business opportunities. Chapter 3 deals with the relations between Italy and Hong Kong. I first disclose some information about the Italian presence in Hong Kong as well as some data about export and import activities. The core of this chapter is the CDTA between Italy and Hong Kong and Hong Kong exits from the Italian black list.