Is your Hong Kong based company looking for an offshore destination with great potential and reliability where you can extend your operation? Incorporation in BVI is one of the choices that a Hong Kong company can go for if it wishes to expand its incorporations and tax planning. This will be an overview of the benefits, key issues, and step by step procedure for a Hong Kong company to incorporate in BVI.
Content Outline
Introduction: Bridging Hong Kong and the British Virgin Islands
The trading center of the world, Hong Kong, has been in existence for quite a long time. Nevertheless, in a more connected world, several Hong Kong firms are stepping out of their territory towards BVI for the purpose of shielding their assets, searching new possibilities and taking advantage of benefits provided by offshore areas.
Related article: Tax-Friendly Policies in BVI. Are BVI really tax free ?
Why Choose the BVI?
Reasons Why Hong Kong Companies Choose BVI
Strategic Location
Good time zone, and very little language barriers.
Legal Framework
BVI is founded on English common law, same with Hong Kong.
Tax Efficiency
Offshore companies are not subject to any corporate income tax, capital gains tax, and wealth tax in the BVI
Flexible Structure
Limited extra cost to move assets and management from Hong Kong to the BVI.
Learn more at BVI Tax Planning Myths Clarified.
For more in depth details, you can read our previous article Tax Exemption in BVI: Your Comprehensive Guide for deeper understanding.
Click Here To Learn More About BVI Incorporation Services
Who Can Form A Company in BVI?
Unlike Hong Kong, you must require a registered agent / corporate service provider to perform company incorporation in BVI. There isn’t a public form for you to download, fill out and submit.
Only an individual who has been licensed by the Financial Services Commission (the “Commission”) as a company management company under the Company Management Act, 1990, or as a Class I or III trust company under the Banks and Trust Companies Act, 1990, is legally authorized to serve as the agent of a BVI business company.
What Do You Need To Prepare Before The Incorporation?
1. Choose an available name
According to the User Guide No. 2 [Company Names]. Your registered agent can perform an electronic online search to determine if a name is currently or has previously been in use, and can provide guidance on whether your chosen name is likely to be approved by the Registry.
A BVI company is permitted to have foreign characters in the name, thus Traditional Chinese names are allowed for Hong Kong businesses.
Below is a table of a summary of BVI name requirements and Hong Kong examples based on our experience.
| Limitations | Number Names | Reserving Names | Name Display Requirement | |
| Description | Similar names must be avoided. | Every company will be assigned a unique number. If you do not select a company name, your name wil be displayed as below: | A registered agent may apply to the Registry to reserve the name on your behalf. | The company name must be in every written communication sent by or on behalf of the company; and every document issued or signed. |
| Examples & Details | For example, the following names would all be regarded as identical: – Big Cheese Limited – Big Cheese Inc. – The Big Cheese Ltd. – A Big Cheese Ltd – Big (Cheese) Limited – Big Cheeses Corp. – Big Cheese Company Limited | BVI Company Number 12345 | 90 Days reservation if approved | – All letters sent by, or on behalf of, the company – All documents required to be lodged with the Registry – Statements of account – Receipts – Orders for goods – Official company notices – Cheques |
| Hong Kong Examples | KWUN TONG COLOUR LIMITED vs KWUN TONG COLOR LIMITED | N/A | N/A | N/A |
2. Decide Your Registered Office Address
Every company must have a registered office address that is physically in BVI. A postbox is not sufficient. Typically, the registered office of a BVI company is located at the office of the company’s registered agent. This arrangement ensures quick delivery of any documents served on the company to its directors. However, this is not compulsory.
3. Memorendum and Articles
Every company must have a memorandum and articles of association that complies with the Company Management Act. According to the user guide No.3, the memorandum must state:
- The company’s name
- The company’s type (ie whether it is limited by shares, by guarantee etc)
- The address of the first registered office of the company
- The name of the first registered agent of the company
- In the case of a company limited by guarantee, details of the members’ guarantees
4. Decide on Directors & Shareholders
Similar to Hong Kong, every company limited by shares must have at least one shareholder and at least one director, who may be the same person. A licensed corporate provider can provide nominee director services.
Your agent will have 6 months starting from the incorporation date to appoint the first director(s).
How Do You Incorporate A BVI Company From Hong Kong?
The various stages involved in setting up a Hong Kong company in the BVI. Let’s navigate through the process:
1. Select Your Corporate Structure:
Start by identifying and evaluating available corporate structures in the British Virgin Islands for your setup of a Hong Kong company. Such options comprise of Business Company, Limited Partnership, or Special economic Zone entity with unique benefits.
2. Engage a Registered Agent like FastLane:
You must obtain the services of an approved and authorized registered agent sanctioned by the BVI FISC. The registrar appointed for this entity will assist in the registration process and see that they comply with local laws.
The registered agent will submit a completed application form to the Registry along with:
- The memorandum and articles of association (including up to three copies), and
- A written consent to act as the registered agent.
Upon verifying that all submitted materials are correct and complete, the Registry will:
- Register the submitted documents,
- Assign a unique number to the company,
- Issue a certificate of incorporation to the registered agent,
- Return the copies of the memorandum and articles of association, each stamped with the Registry’s seal.
Assuming the documentation is accurately completed and the selected name meets all requirements, a standard Hong Kong company limited by shares (without Chinese character name) should be incorporated in the British Virgin Islands within one working day from when the application is received by the Registry.
The company becomes officially incorporated from the date indicated on the certificate of incorporation and will bear the name as specified on the certificate.
3. Open a Bank Account:
Open a bank account in the BVI for convenience in handling financial operations and management of assets. Choose an ideal bank having its major branch in Hong Kong and BVI so that the funds can be transferred swiftly.
4. Regulatory Reporting:
Keep up to date with requirements of annual filing, financial reporting, and adherence to national regulations. Get in touch with such individuals as lawyers and accountants so that they can help you meet the above requirements. Read more New BVI Requirement to Produce an Annual Return (AR) Each Year
After Incorporation
There are duties expected from a BVI company director. It is expected that these duties are being upheld after the incorporation.
As a director, you must:
- Act with honesty and diligence.
- Understand the company’s operations and ensure compliance with all laws and regulations.
- Guarantee the company can pay its debts and maintains accurate financial records.
- Exercise extra caution if handling other people’s money.
- Always prioritize the company’s interests, even over your own or other affiliations.
- Ensure all regulatory filings are completed on time.
- Use information obtained through your role responsibly and in the company’s best interests.
BVI Company Formation Government Fees
Here’s the information about the incorporation fees for Hong Kong companies looking to incorporate in the British Virgin Islands (BVI), presented in a table format:
| Authorization Level | Incorporation Fee | Annual Fee | Annual Fee Due Date |
|---|---|---|---|
| Less than 50,000 shares | $350.00 | $350.00 | May 31st if incorporated between Jan 1 and Jun 30 Nov 30th if incorporated between Jul 1 and Dec 31 |
| More than 50,000 shares or Unlimited shares | $1,100.00 | $1,100.00 | May 31st if incorporated between Jan 1 and Jun 30 Nov 30th if incorporated between Jul 1 and Dec 31 |
| Bearer Shares (Note) | Significantly higher | Significantly higher | Same as above |
Note: The incorporation and annual fees for a company authorized to issue bearer shares are significantly higher than those stated for other authorization levels.
Conclusion: A Gateway to Offshore Success
Integration of a Hong Kong Company in the British Virgin Islands presents numerous advantages and opportunities. Through combining the strength of the international business environment of Hong Kong and competitive offshore benefits of BVI, your company will succeed well in the world marketplace. Therefore, if you choose to begin this offshore journey, ensure to consult professionals and abide by laws. Synergic cooperation of Hong Kong with the BVI points towards success on the international level, as well as asset protection.
Are you prepared to look into what is possible with a Hong Kong company in the BVI? Do not wait any longer and contact FastLane Group to start your offshore journey.
Frequently Answered Questions
Yes, there are no nationality or residency restrictions for directors or shareholders of a BVI company. This flexibility makes it an attractive option for international businesses.
BVI companies are not required to hold annual general meetings unless specified in the articles of association. Meetings can be held virtually from anywhere in the world, adding to the jurisdiction’s flexibility.
BVI companies are commonly used in estate planning to manage and distribute assets globally, often in conjunction with trusts, to facilitate seamless succession and minimize probate requirements.
Many law firms and corporate service providers in Hong Kong like FastLane specialize in BVI company formations and can handle the entire process, from initial incorporation to ongoing management and compliance.