HONG KONG ADVANTAGES

World's Freest Economy
Hong Kong is famous for its open economy system and it is one of the world's premiere financial centres. Its freedom of capital movement, sound legal system, efficient transportation system, state-of-art telecommunication backbones and the wide use of English in business have contributed to its success. Free trade is the life-blood of Hong Kong. As a result, it is one of the most open, externally-orientated economies in the world. The Heritage Foundation and Fraser Institute of Canada have consistently rated it as the world's freest economy. Hong Kong embraces globalization of trade and services and is an active participant in international organizations that promote such activities.

	The cornerstone of the economy rests on free enterprise, free trade and free markets open to all
	No barriers to trade - no tariffs, no quotas, no exceptions
	No restrictions on investments inward or outward
	Trade to GDP ratio of 250% in 2002
	No foreign exchange controls
	No nationality restrictions on corporate ownership

Clean Government
Hong Kong is headed by the Chief Executive. The executive arm of the Government, the Administration, is organised into the Government Secretariat and departments. Bureaux in Government Secretariat formulate policies and initiate legislative proposals while departments implement laws and policies and provide direct services to the community.

Hong Kong is one of the most corruption-free economies in the world. Cronyism, influence-peddling and bribery receive zero tolerance here. This is due to our strong administration as well as Hong Kong's Independent Commission Against Corruption (ICAC). Since it was founded in 1974, the ICAC has promoted a strong anti-corruption culture in Hong Kong. Its success has been such that several countries around the world, including Australia, have modelled their graft-fighting agencies on Hong Kong's and consult the ICAC regularly.

The clean government ensures that companies are free to pursue their business interests on a level playing field without concern for corruption.

Rule of Law
The rule of law is fundamental to Hong Kong's success. Hong Kong was ruled by the British Government but it became the Special Administrative Region of the People's Republic of China (PRC) on 1 July 1997. The British introduced the English legal system to Hong Kong. As a result, English common law and rules of equity apply. Laws in Hong Kong have also developed through the Legislative Council enacting its own statute law (i.e. Ordinance). After 1997, the laws in Hong Kong remain basically unchanged and Basic Law serves as the constitutional legislation.

Hong Kong's legal system is separate from Mainland China. The impartial judiciary is independent of the legislature and executive, and is drawn from several British Commonwealth jurisdictions as well as from Hong Kong itself. Cases are heard in English and/or Chinese.

The Court of Final Appeal operates in Hong Kong and is staffed by senior judges from Hong Kong and distinguished overseas judges on rotation. It replaced the British Privy Council as the final arbiter on all affairs other than foreign affairs, defence and Chinese constitutional issues, which are the responsibilities of the sovereign state, China.

Hong Kong has developed into one of the world's major arbitration jurisdictions since establishing its International Arbitration Centre in 1985. Its expertise in commerce, finance, shipping and construction provides the necessary pool of experienced professionals to promote dispute settlements. These include accountants, architects, bankers, engineers and insurance experts, as well as lawyers.

Hong Kong has its own 35 000-strong police force. It operates independently of Mainland China's law-enforcement institutions. Crime levels in Hong Kong are low. And its streets are among the safest in the world.

Low Taxes
Hong Kong taxes are among the lowest in the world, and the tax regime is simple and predictable. Profits tax payable by local and foreign companies is equally low 17.5 percent. The actual tax bill is even less after various deductions and depreciation allowances.

There is no capital gains tax in Hong Kong. Furthermore, there is no withholding tax on dividends and interest and no collection of social security benefit.

Salaries tax is also very low using a progressive tax rate imposed on all salary income of individuals derived in or from Hong Kong. The salaries tax is demanded on a yearly basis and can be paid in two instalments, usually between December and March.

The property tax applies to owners of land or buildings situated in Hong Kong. Again this is low 16 percent (for 2004/5) of the rental income from the land or buildings and an allowance of 20 percent is permitted for repairs and maintenance.

There is no sales tax or VAT in Hong Kong. The limited tax base, combined with exceptionally low tax rates, makes Hong Kong's tax incidence much lower than in virtually all other developed economies.

Generally, a newly incorporated business will receive its first Profit Tax Return about 18 months after the date of incorporation. Then, the annual exercise to issue Profit Tax Returns in bulk takes place on the first working day of April each year. It is the practice of the Inland Revenue Department not to call for the annual submission of Profit Tax Return in instances where trade or business carried on does not give rise to assessable profits or where it has not commenced or has ceased and not recommenced. However, upon receipt of a Profit Tax Return which may be issued from time to time in the course of reviewing their future tax potential, the requirement to lodge the return form must still be complied with.

The Stamp Duty Ordinance (Cap. 117) imposes duty on certain types of documents (conveyance on sale, agreement for sale of residential property, lease of immovable property, and transfer of Hong Kong stock). On transfer of Hong Kong stock, stamp duty on sale or purchase of any Hong Kong stock is charged at rate which vary with the amount or value of the consideration as follows: a). Sold/Bought Note - 0,1% of consideration/ value; b). Instrument of Transfer - HK$5.

Estate Duty is to be abolished as announced in the 2005/06 Budget by the Financial Secretary.

There is no Sales Tax / VAT in Hong Kong.

There is no Capital Gain Tax in Hong Kong.

Free Flow of Information
Hong Kong enjoys a constitutionally-guaranteed free press and freedom of speech. More than 40 newspapers and 700 periodicals are published in Chinese and English in a city that is home to about 130 media organisations. There is no government censorship and both local and overseas publications circulate without hindrance. All the top international news organisations maintain a presence in the territory and many trans-continental publications print their Asian editions here. As a result, journals such as the International Herald Tribune, the Financial Times, USA Today and Nihon Keizai Shimbun are available first thing in the morning.

All the world's major news agencies, including Reuters, Associated Press, Agence France-Presse, Dow Jones Newswires and Bloomberg, have a presence in Hong Kong, where they freely collect and distribute news, data and financial information. Their services are augmented by smaller specialist agencies, including mainland Chinese and Taiwanese organisations.

Hong Kong is one of the most Internet-savvy cities in the world. It is rapidly adopting the latest wireless technology as it rolls out. The government does not seek to censor Internet access through mandatory filtering software or other measures. Broadband is available to over 98% of households and more than 95% of business buildings.

Skilled Workforce
Hong Kong ranks among the very best in the world in terms of management experience in international business. The extraordinary success of our economy owes much to its well-educated and adaptable workforce. Hong Kong's workforce is computer-literate, resilient, flexible and entrepreneurial. The culture here is one of industriousness underlined by a hunger among individuals to better themselves. Labour relations are generally harmonious. English is the lingua franca of the business and legal community.

Immigration procedures for skilled personnel are transparent and straightforward.

Unrivalled Location
Hong Kong has a prime location at the geographical and economic centre of Asia.

Business executives in Hong Kong have fast and easy access to all the major markets in the Asia Pacific region. We have a world-class airport that operates on a 24-hour basis. Daily non-stop flights are available to major cities in the Asia Pacific, North America, Europe, the Middle East and South Africa. Taking a flight from the Hong Kong International Airport, one can reach most countries in Asia within five hours or less.

Located on the southeast coast of Mainland China, Hong Kong has the vast hinterland which, with 1.3 billion people, is going to be the largest single market in the world. Corporate executives can travel back and forth to Beijing, Shanghai and other major Chinese cities in a single day while making their home in Hong Kong. For companies with manufacturing facilities in the Pearl River Delta area, their executives can go there by car within one to three hours.

World Class Infrastructure
The telecommunications system in Hong Kong is fully digitised. The government began de-regulating the industry as early as 1995 when it issued fixed line telecommunications network service licences to four providers. The mobile phone services market is very competitive with six operators and 11 networks. There are currently more than 200 Internet Service Providers in Hong Kong, more than five of which provide broadband connections. Broadband Internet connection is available to over 98% of households and more than 95% of business buildings.

The only modern, fully developed deep water harbour between Singapore and Shanghai, Hong Kong is the focal point of all maritime activities in southern China. The container port in and around Kwai Chung is privately owned. In 2001, Hong Kong handled a total of 17.8 million TEUs, making it the world's busiest port. Vessel turnarounds are among the fastest in the world and port charges are among the lowest world-wide. Container ships at terminal berths are routinely turned round in 10 hours or less, while conventional vessels working cargo at buoys are in port for only 1.8 days on average.

The state-of-the-art Hong Kong International Airport is just 23 minutes from the central business district by rail. Opened on July 6, 1998, the Hong Kong International Airport links to some 130 destinations world-wide served by more than 3 600 flights per week. It is already one of the world's busiest airports and can process about 35 million passengers and 3 million tonnes of air cargo annually at present.

International Lifestyle
Hong Kong offers a stimulating, dynamic and cosmopolitan lifestyle. It's a city that never sleeps. But it also has its tranquil side with lush countryside and remote beaches accessible only from the sea. Some 40% of Hong Kong is country park and shielded from development. Botanists and zoologists are still finding hitherto unrecorded species of flora and fauna. The marshlands shelter one of the widest varieties of birdlife in the world.

It's a city of eastern and western culture with arts centres, museums and libraries. The annual Arts Festival and cultural events all year round feature top performers from around the world.

It's the food capital of China. Every Chinese regional cuisine is celebrated in Hong Kong. It's a city with well-developed international tastes, too. Whatever one fancies, whether it's haggis or sushi, French haute cuisine or burgers, falafel or pizza, Hong Kong diners are spoilt for choice.

Residential rentals are in line with those in major international cities such as London and New York. The choice of accommodation is wide: ranging from luxury high-rise flats in the heart of the city to detached villas in the rural New Territories. Two-year rental leases are standard. There are no restrictions on foreigners buying property.

Taxis and buses run around the clock and there is virtually no corner of inhabited Hong Kong that is inaccessible. The underground and over ground railways are fast, reliable, reasonably priced and equipped with state-of-the-art equipment. Ferries and catamarans link Hong Kong's inhabited offshore islands. For those not in a hurry, the tried-and-tested two-tier electric trams, in service for more than a century, still trundle along the east-west axis of Hong Kong island's north shore. The Peak tram is more than a tourist attraction. Many inhabitants of Victoria Peak use it to commute to Central District.

Some 44 international schools offer more than nine curricula, providing children with an education compatible with their home country. These include the Australian, British, Canadian, French, German/Swiss, Japanese, Korean, Singaporean and US systems. Several Hong Kong universities offer opportunities for part- or full-time life-long learning opportunities.

World-class private and public health services are staffed by locally and internationally trained doctors, dentists, nurses and other medical professionals. As an additional benefit, Hong Kong is the world leader in research in traditional Chinese medicine and licenses trained practitioners.

Listing all Hong Kong's clubs, associations, interest, hobby and activities groups would be a full-time job. Suffice to say it is probably harder to find an interest or activity that is not catered for in some way.

Hong Kong's dining, bar and clubbing scene offers the widest range of choice and variety in Asia, catering to all tastes and desires. People here work hard, but they also play hard.

Athletes, whether fanatical or purely recreational, are well catered for. Horse racing is the most popular leisure activity among Hong Kong people but top class facilities abound for just about every activity. Many private clubs offer reduced entrance fees for those with sporting skills.

Rugby has grown in stature since Hong Kong began hosting its annual international sevens tournament 20 years ago. Sailing has long been popular and windsurfing has taken off since Hong Kong won its first Olympic gold in the sport. Wakeboarding and surfing are the latest crazes. Public facilities are provided for all the mainstream sports, including soccer, golf, riding, table tennis and court-sports such as squash, badminton, tennis and basketball.

Almost every style of the martial arts is practised in the city that invented the kung fu movie genre. Cricket, hockey (ice and field), karting and mountain-biking all have followings in Hong Kong.

Order Incorporation