There are many entrepreneurs all over the world who would like to set up their businesses in Hong Kong. However, before beginning a business in Hong Kong, registration of a business and outlining all business activities are necessary.
One of the key components of the business registration process in Hong Kong is a classification of the Hong Kong Standard Industrial Classification Code (HSIC) which is a system that classifies economic units in Hong Kong and breaks down each sector based on the businesses classified according to the type of their primary economic activities.
This article will focus on the HSIC, its significance, and how to get the code that best refers to your business activities.
Content Outline
What Is The HSIC Code?
The Hong Kong Standard Industrial Classification (HSIC) system divides business classes into economic activities categories,which allows the collection of the statistical data of different activities on industries and sectors in Hong Kong. This framework came in handy in undertaking economic analysis, research and policy formulation on international trade and business activities.
The HSIC, whose codes follow the ISIC Revision 2 introduced in 1990, has gone through its first version, the HSIC V1.0, early 2000s, and an updated version, the HSIC V1.1, in 2001. In 2008 the second version of the HSIC, V2.0, was launched into operation and employed from the year 2009 onward.
Due to the ISIC Revision 4 or “All Economic Activities” by the UN Statistics Division, HSIC V2.0 strives to increase the relevance, alignment and transition compatibility. The taxonomy has undergone transition from a 4-level to a 5-level hierarchy, and now it has 21 top-class categories. This makes the standard more global and allows more precise analysis.
What Are HSIC Codes Used For?
HKSI codes are employed to categorize the business entities in Hong Kong based on the kind of economic activities that they are involved in. Here are some of the reasons HISC codes are used for :
- Data Analysis: HSIC codes help us classify statistical data eliminating the nightmare of going through a mess of data. Thus, analysis becomes easy to conduct an in-depth analysis and stand up to the trends and patterns within certain industries or sectors.
- Government Policies: Governments and policymakers employ HSIC codes as a tool to determine the efficiency of industries, identify growth opportunities, and frame policies supporting economic growth.
- Business Planning: Companies can use the industry classification which is the HSIC codes to help with their business strategy, market research, and competitive analysis.
- Regulatory Compliance: Some of the requirements within the regulatory framework might be device-specific and so the HSIC codes assist businesses in being compliant with the regulations that apply specifically to them.
Ultimately, HSIC codes are an important tool for analyzing the Hong Kong economy, and determining policies, and business operations.
How To Choose HSIC Code For My Business?
HSIC V2.0 has a 5-level hierarchical system:
- The most general section at the top level are industrial category. There are twenty-one industry categories.
- Each industry category has its own subcategories that we call industry divisions. It consists of 88 branch industries.
- For each of the industry divisions, there are industry groups. Some classified sections include 221 business categories.
- Under every industry group are the industry classes. There are 483 industry groups in total.
- Generally, for each industry class, there is an industry sub-class for the specified business class. The industry consists of all “1001” industries.
This table shows how to read the HSIC Code :
| Level | No. of Categories | HSIC code format [Range] | Example |
|---|---|---|---|
| Top level: Industry Section | 21 | 1-digit alphabet [A-U] | G – Import/ export, wholesale and retail trades |
| Second level: Industry Division | 88 | 2-digit numeral [01-99] | 47 – Retail trade |
| Third level: Industry Group | 221 | 3-digit numeral [011-990] | 472 – Retails sale of food, beverages and tobacco in specialized stores |
| Fourth level: Industry Class | 483 | 4-digit numeral [0110-9900] | 4721 – Retail sale of food in specialized stores |
| Fifth level: Industry Sub-class | 1001 | 6-digit numeral [011000-990000] | 472105 – Retail sale of fruits and vegetables, fresh |
Sections of HSIC Industries
As previously stated, HSIC V2.0 has a 5-level hierarchical scheme, with industry sections serving as the highest-level category.
It is important to note that there are 21 industry sections in total, which are mentioned below:
| Section | Industry |
|---|---|
| Industry Section A | Agriculture, forestry, and fishing |
| Industry Section B | Mining and quarrying |
| Industry Section C | Manufacturing |
| Industry Section D | Electricity and gas supply |
| Industry Section E | Water supply; sewerage, waste management and remediation activities |
| Industry Section F | Construction |
| Industry Section G | Import/ export, wholesale and retail trades |
| Industry Section H | Transportation, storage, postal and courier services |
| Industry Section I | Accommodation and food service activities |
| Industry Section J | Information and communications |
| Industry Section K | Financial and insurance activities |
| Industry Section L | Real estate activities |
| Industry Section M | Professional, scientific and technical activities |
| Industry Section N | Administrative and support service activities |
| Industry Section O | Public administration |
| Industry Section P | Education |
| Industry Section Q | Human health and social work activities |
| Industry Section R | Arts, entertainment and recreation |
| Industry Section S | Other service activities |
| Industry Section T | Work activities within domestic households |
| Industry Section U | Activities of extraterritorial organizations and bodies |
What Is The Appropriate HSIC Code For My Business In Hong Kong?
The proper selection of the HSIC code is very vital for your business to use the HSIC code for its principal activities.
You have to choose a code of such kind that may suit the purpose of applying for the license from your state. To get a general knowledge of it, just refer to the lists of trade codes (available in both English and Chinese).
To check up on a particular SIC code in Hong Kong, do it through the code search tool. If the code is chosen, the next step is to make a feature that can be used as a license that will be used at the entry point of Hong Kong.
You might also find detailed interpretative notes that will give you explanations of the industries covered in the HSIC which you could use for more information.
How FastLane Group Can Help?
FastLane Group will help you to utilize the business possibilities in Hong Kong. We provide company registration and accounting services including compliance and beyond, by our expert team, ensuring that they do everything possible to make the journey for your business a smooth one. Call us today and experience the ease of doing business with us.
Frequently Answered Questions
You can find the HSIC codes of your industry by referring to Hong Kong’s Standard Industrial Classification system given by the Census and Statistics Department. It creates business categories for their primary economic capabilities.
The HSIC code is critical because it assists in determining a business engaged in which for statistical and administrative purposes. It supports data analysis, good governance, business forecasting, regulations enforcement, and so on.
Usually, a business cannot change its foreign trade code (HSIC) in its own way. It needs to be functioning based on its main economic activity. Nevertheless, when substantial changes take place in how your firm operates, it may be necessary to revise the HSIC code accordingly.
However, all business sectors in Hong Kong are classified under HSICE by their economic activity. A code that is correctly done will be needed for statistical draft, regulatory purposes, and useful for planning issues.
However, it is better for you to choose the HSIC code that best fits your main business area of activity, even if it is not an exact match. In case no particular response is required, then you can reach out to the relevant authorities for help.
Yes, if your business carries out many activities and serves many sectors, you may register under various HSIC codes to show that your business has diverse operations.