The free market policy is a policy that most countries are working towards. The benefit of this policy is that it will make the import and export activities within countries to be fast and easy and it will also promote foreign investment which is a good thing for any economy.

Hong Kong has been successful in this and it known to be one of the best free market cities in the world. In Hong Kong, you can invest and run your business comfortably without facing any extra charges or costs in the name of you are not an original residence of Hong Kong. Apart from this, you will be able to export your good and services to other countries fast and this easily and this is the main reason why most foreign investors go for countries that have the free market policy.

One thing with the free market policy is that there is a quick movement of goods at the ports, both in and out. This makes it very easy for your products to react to the intended market at the right time as scheduled. Countries that have not yet opened up for the free market policy are actually depriving their economy from growing. Hong Kong is open and ready to do business with any country in the world because this is one of the advantages of the free market policy. There are also some countries that do not agree to trade with countries that are not operating under the free market policy.

In Hong Kong, your investment has a higher chance of being successful because your market will be expanded. The Asian market according to the international business reports is one of the markets that have not yet been tapped properly and most investors are actually targeting it. You should know that Hong Kong is located right at the heart of Asia and there is no way better way than using Hong Kong as your gate way to the rich Asian market. With the free market policy in Hong Kong, you can easily trade and expand your business to the rest of Asia.

Hong Kong is open to any type of business and it provides you with all the tools necessary for your business to expand and reach out to the rest of the world especially the rich Asian market. It is very difficult for you to access the Asian market directly without going through Hong Kong because things like the free market policy and professionals for your business growth may not be available for you let alone good communication.

Critical aspects of successful retailing are the qualities and quantities of shoppers that attract customers towards their offers. Being a world renowned known destination for shopping, Hong Kong has the unique distinction of having both.
Being a favorite destination for shopping of the affluent Chinese products from the Mainland, it has an unparalleled “shop window” targeting retailers and a testing bed for further future expansion. One can optimize retail business opportunities because of the presence of free port with no export or import tariffs levied on most goods, zero sales tax and low tax base.
Retail
Irrespective of whether one is a wholesaler, a retailer, involved in trading, sourcing or buying, the territory offers every individual double dual advantages to access and achieve proximity to the consumers. Throughout the year, the climate in Hong Kong is conducive for year-round outdoor and indoor shopping and four distinct seasonal variations propel seasonal consumption.
The superb location of the City coupled with its hub status in Asia, make Hong Kong a very ideal gateway to China Mainland and to other markets that are emerging. This includes manufacturing countries like Indonesia, Thailand, Vietnam and Bangladesh. It also has a huge pool of talented skills, from merchandising to design.
Jewelry
The world’s fifth largest net exporter of jewelry is Hong Kong. It is the world’s number two exporter of customized jewelry. Hong Kong is the leading centre of production for items of pure gold, the main centre for production of jade and leading distribution and trading pearls centre. Top of all, Hong Kong is also the diamond trade capital of Asia.
It has a huge concentration of suppliers, designers and buyers. Affordable manufacturing is easily reachable in Mainland China, coupled with Hong Kong’s huge talent pool, promote suitable conditions for processing which is value-added. On top of that, jewelers who are exporting to China Mainland from the territory of Hong Kong are getting benefits from nil import tariffs, in comparison to those exceeding 35% for outsiders and companies that are not compliant with CEPA.
Final fast Facts
• Most of the Hong Kong’s 48.6 million yearly visitors come with a view for shopping expressly.
• There are zero import tariffs on almost all the products and nil sales VAT or tax due to which, it is really easy to shop here.
• Shop keepers spend $3.8 US billion or more within a month, which is really impressive and huge amount.

In this era, ICT has become the backbone of all human undertakings be it social political but more interestingly in economy. Hong Kong is strategically located for information and communication technology due to which, investors are keeping an eye on the Asian market. The city houses regional offices for the Pearl River delta multibillion companies and many other international offices.  This is a ready market for ICT professionals and companies. The city is blessed with ICT wizards who are ready to execute the regional ICT projects taking care of either the local or the entire region owing to Hong Kong’s centralized location in Asian pacific.

Quality telecommunication infrastructures in Hong Kong stand tall in the world; this makes it good for international data centre as well as excellent for investments providing the world with competitive markets. This infrastructure includes 17 overhead cables, 8 satellites and eight submarine cables. The town doesn’t have history of natural disasters compared to their neighbors and the efficient and constant power supply has drawn more cables installed including the southeast-Asia Japan cables and the Asian submarine –cable express.

Cloud Technology

Logistics, manufacturing and financial institutions are the large customer bases for the cloud technology and related services. Hong Kong has the demand which can’t be easily quenched so there is a potential for growth in this sector. The government proposal to provide e-services and disseminate information via cloud technology has increased the technology demand though, includes functions to support infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS) from private sector for all government offices and departments.

Data Centre’s

Data centre operators enjoy the secure and privacy of such data in Hong Kong. The diverse unsatisfiable market of the Asia pacific ranges from financial institutions, service companies, transports and logistics sector.

Software and Services

Owing to the client base in the finance, electronics and multinational companies, most of the international software development companies have regional offices in Hong Kong. The city has a tech savvy population and the intellectual property protection by the government in place which tells the potential the city has.

Telecommunications

Asia’s telecom market serves as an ideal location for multinational telecommunication companies. If you are one of them, the government has liberalized the market whether you have come from the South or North Pole, Hong Kong is your business ground especially for the telephone industry and its accessories. We are at proximity with the China’s mainland and the local market and professionals in the city.

Hong Kong has been in the front line to providing the most friendly emigration policies. This has helped various professionals to access the job market in Hong Kong and the neighbor growing economies. The well educated population has grown a vast task force in areas of specializations from the local talent enhancement though formal and technical education. The society is pegged on excellent work ethics that make them cope well with any working environment and anyone as an employer embracing international professional code of conduct.

People of Hong Kong are cultured to perform an efficient work and have a positive mental attitude towards work. This is a proof that their economic growth is out of their efforts and they are hard working and knowledge of western business culture. Hong Kong schools and business colleges teach English, which is the most preferred language in the entire business world. This serves as a common factor for the professional competitiveness and exploitation of skills. Vast population can as well communicate proficiently in the languages used in China and Hong Kong. These languages are Putonghua and Cantonese respectively.

The best work ethical practice in Hong Kong leaves people with no fear for industrial actions in the event they have been hired locally. The visitor’s friendly immigration policies have attracted such professionals from all over the world along with investors towards the city. Work visa are more or less free for the talented and skilled professionals. The human policies allow diplomats and the expatriates to bring with them their dependants and family members who in turn can freely work in Hong Kong and can do any type of investments.

Hong Kong houses the best and most competitive science and technical universities in Asia. In the year 2012/2013, QS world university rankings have placed Hong Kong University the best in the entire Asia. The same thing applies to the Hong Kong’s business colleges with such colleges like the Hong Kong University of Science and technology on top in the EMBA programme world wide.  In order to sum it, Hong Kong has 3 universities in the top 50 and up to 5 in the best 200 globally. You can guess the quality and competitiveness of such graduates who leave these universities for the Hong Kong job market. The liberal job market leaves people with choices and they can do it with a lot of ease

Hong Kong Offers Unrivalled Opportunities in the Financial Sector

Monetary Services

Hong Kong is the perfect portal for remote firms looking for access to the Mainland, and for territory ventures going worldwide. Famous for its free stream of data and capital, progressed fiscal foundation and successful administrative administration, Hong Kong has pulled in a rich pool of expert ability and monetary dexterity. Moreover, Hong Kong’s position as a major possession administration, capital framing, saving money and protection center point is underpinned by a business-nature’s turf, low levy and a trusted lawful framework.

Actually, Hong Kong overwhelms the United States and the United Kingdom to top the World Economic Forum’s twelve-month Financial Development Report discharged in October 2012. This is the second sequential year Hong Kong stacked up in first and Hong Kong’s position was supported by solid scores in non-saving money fiscal administrations, for example, Ipo movement and protection.

The monetary administration industry is one of Hong Kong’s four column businesses, which utilized 226,400 individuals in 2012, or 6.2% of the city’s whole workforce. In the keeping money segment, Hong Kong is one of the biggest saving money centres on the planet with 70 of the planet’s top 100 banks being made a vicinity here.

Hong Kong’s Role as an Offshore Rmb Centre

The expanding renminbi (Rmb) business is an alternate splendid spot in Hong Kong’s budgetary administrations industry. Hong Kong has improved into the most exhaustive and aggressive stage for seaward Rmb business. In 2012, renminbi exchange settlement took care of by banks in Hong Kong developed into Rmb2,633 billion yuan, representing 90% of the aggregate sum of Mainland China’s outer exchange settled throughout that period (Rmb2,937 billion yuan). This reflects Hong Kong’s part as the worldwide center point for renminbi exchange settlement, serving both nearby and abroad banks and organizations. Separated from furnishing a full run of Rmb saving money administrations incorporating exchange settlement and financing, Hong Kong has the biggest pool of seaward Rmb liquidity, and has turned into the worldwide center point for Rmb faint entirety securities with issuance totaling Rmb237 billion yuan in 2012.

Managed Growth in the Fund Management Sector

Hong Kong’s trust administration business is not just exceedingly internationalised. Consistent with the most recent review issued by Securities and Futures Commission (Sfc), the holdings under administration (Aum) arrived at Hk$5,764 billion in 2011.

In the meantime, Hong Kong’s fence stock investments industry remained vigorous. As the most recent review from Sfc demonstrated that the aggregate fence investments Aum in Hong Kong expanded from Us$9.1 billion in 2004 to Us$87.1 billion in Q32012.

http://www.investhk.gov.hk/business-opportunities/financial-services.html

Hong Kong succeeds on brawny employment principles, competence and a positive approach. Its citizens propose a charming amalgamation of global confidence and information about latest commerce civilization. Approximately all commerce specialized personnel articulate outstanding English, the customary verbal communication of commerce. A lot of citizens also articulate Cantonese and Mandarin; this is a sign of success in the marketplace. Employing confined workers is uncomplicated and Hong Kong’s brawny employment principles formulates business exploit an enormously atypical occasion. Hong Kong’s migration strategies are considered to exert a pull on in a foreign country proficient personnel, aptitude and sponsorship. Guidelines are easy to understand and migrant human resources can usually convey their partner and contingent belongings.
Visa information can also be acquired by the visit of the website as it is an easy and authentic source of knowledge. Through this technique, people can gain proper information about visa types and they can promote their business easily without any complexity. In the same way, this information is helpful for those people who are taking interest in working with those firms and companies that are presenting their business programs in Hong Kong. So, employees and employers can connect with each other and this connection is simple and effective due to the use of the latest technologies and resources that are accessible for all people without any doubt and reservation. Accordingly, people can find best professional opportunities in the society with the use of modern employment techniques that are also suitable for those companies that are also seeking for talented and qualified personnel in the market place.
Some things are subsequently important in this matter which should be followed essentially to make professional life winning and successful. For instance, employees should follow the employment rules and regulations because this care is the cause of creation of long term business relations in the market. In other side, those people who are careless in this matter are not able to make their professional life winning and successful. So, people should be careful and use proper sources to attain proper awareness about employment programs that are favorable for all people without any difference and divergence in the society. Thus, proper awareness and concentration of the public is essential to make employment programs winning and accomplished without any complexity. In this matter, the use of contemporary sources is also beneficial for all people to make their professional and societal life uncomplicated.

Overview of the Pilot FTZ
Shanghai Pilot FTZ is a regional free trade zone established by the PRC
Government in Shanghai, with an area of approximately 28.78 km2 covering
four zones, namely Waigaoqiao Free Trade Zone, Waigaoqiao Bonded
Logistics Park, Yangshan Bonded Port Area, and Pudong International Airport
Comprehensive Free Trade Zone. The Pilot FTZ, focusing on service industry
and trading industry, and system innovation, will promote the reform in and
opening of six industries, i.e. financial service industry, shipping service
industry, commerce and trade service industry, professional service industry,
culture service industry and social service industry. Moreover, new service
models and administrative and management systems will actively be tested in
the Pilot FTZ in order to create an international business environment in which
the rule of law is upheld.

System Innovation

From:http://www.conpak.com/Interpretation-of-Policies.html

Negative List Management
The negative list management of the Pilot FTZ represents a significant breakthrough for the foreign
investment system in China. Traditional investment management list tells the investors “what they can do”
while the negative list tells “what the investors cannot do”, indicating that the investors are allowed to do
anything other than those listed on the negative list. According to “Catalogue of Industries for Guiding
Foreign Investment” and relevant laws and regulations, the municipal government of Shanghai issued the
first negative list on 1 October 2013, setting out 1,069 subcategories and 190 clauses of regulatory measure.
Although the items set out in the negative list are generally the same as current restricted and prohibited
items, the government officers have stated that the negative list would be modified in due course based on
the laws and regulations for foreign investment and the needs for the development of the Pilot FTZ, and
therefore it is still expected that the negative list will enhance the flexibility of investment.
Filing System for Offshore Investment
A filing system is adopted for the administration of establishment of enterprises carrying out oversea
investment by the enterprises in the Pilot FTZ and the general items of overseas investment. Previously, the
enterprises had to go through rigorous examination and approval procedures and complicated application 4
Filing System for Offshore Investment
A filing system is adopted for the administration of establishment of enterprises carrying out oversea
investment by the enterprises in the Pilot FTZ and the general items of overseas investment. Previously, the
enterprises had to go through rigorous examination and approval procedures and complicated application
formalities for oversea investment, bringing much uncertainty to the investment plans. Upon the
implementation of the filing system, the relevant formalities will be streamlined which helps the enterprises
expand their businesses into international markets.
Financial Reform
The Opening and reform of financial industry is also a bright spot of the Pilot FTZ, and the details of which
are as follows:
– Allow the conversion of capital account items and separate accounting on the condition that risks are
– controllable.
– Encourage financial institutions to exercise their rights of self-pricing to gradually promote the
– marketization of interest rate.
– Allow carrying out cross-border RMB business to boost the cross-border use of RMB
– Establish an appropriate foreign exchange management system for the development of the Pilot FTZ to
facilitate trading and investment
– Allow different types of financial institutions to be set up in the Pilot FTZ to build an international
trading platform
In the Pilot FTZ, banks are not subject to the restriction of “one branch only in a city” and are allowed to
set up “branches” rather than “sub-branches”. Currently, ICBC, Bank of China, SPD Bank and Bank of
Shanghai have set up branches in the Pilot FTZ while those foreign owned banks and insurance companies
such as Citibank, HSBC, BEA and Standard Chartered Bank have also set up points of service one after
another.
So far, no details for the financial reform in the Pilot FTZ have been announced and the extent of opening
up is still uncertain. In view of the fact that only the interest rate for deposit has not yet been liberated in the
process of interest rate marketization, the market expects that the PRC Government is likely to launch the
marketization interest rate first. Moreover, the financial innovation of the Pilot FTZ will also promote the
development of offshore financial services.
Mode of Supervision and Control
A mode of supervision and control under which the first line* is opened and the second line* is controlled,
and goods within the FTZ are freely moved is implemented in the Pilot FTZ. The first line mainly focuses
on checking and controlling people entering in or coming out of the zone and the checkpoint authorities are
only responsible for necessary inspection and quarantine control. On 9 October 2013, the policy of
“importation before declaration” was adopted in the Pilot FTZ, permitting an enterprise to directly transport
the goods into the zone with import manifests and make declaration with the competent customs office with
an imported cargo record list. Meanwhile, the goods may also be freely moved within each special customs 5
controlling areas and across those areas within the Pilot FTZ. Enterprises set up in the FTZ will not in
principle be subject to regional restriction, and they are allowed to make investment or carry out business
activities outside the Pilot FTZ. However, if specific regulation requires the completion of relevant
formalities, the enterprise should follow such regulation. This new mode of administration is a breakthrough
of the administration modes adopted in other comprehensive bonded zones, significantly facilitating the
movement of people and goods and lowering import and export cost of cargos.
Note: The rst line: national boundary
The second line: domestic industry sectors
Reform on Business Registration System
To create a fair business environment, a reform on business registration system has been implemented in
the Pilot FTZ with following actual measures:
– Business licenses of the same type will be issued to the enterprises set up in the FTZ except those
– enterprises under business licenses for a rural specialized cooperative association as a legal person and
– business licenses for privately or individually-owned business.
– A pilot registration system for subscription for registered capital is implemented in the Pilot FTZ under
– which the industry and commerce bureau only registers the registered capital or total capital subscribed
– by all shareholders or the promoters and no paid-up capital of a company will be registered. A
– shareholder’s liability to a company with limited liability is limited to the amount of capital contribution
– subscribed by such shareholder. A shareholder’s liability to a company limited by shares is limited to the
– shares subscribed by such shareholder.
– The requirements of minimum registered capital of RMB 30,000 for a company with limited liability,
– RMB100,000 for a company with limited liability with sole shareholder and RMB5 million for a
– company limited by shares are waived in the Pilot FTZ.
– Normal production and operation activities may be carried out by an enterprise set up in the Pilot FTZ
– once it has been registered with a industry and commerce bureau and obtained a business license.
– However, for an enterprise which carries out permitted business activities, it must obtain the business
– license and a permit or an approval before the commencement of such activities.
– A pilot system for public announcement of annual reports will replace the annual check system and an
– enterprise may submit its annual report to the industry and commerce bureau and disclose the same to
– the public through the credit information public announcement system. An enterprise which fails to
– comply with the requirement will be included in the unusual operation list (經營異常名錄).
– An application for business registration can be made either on site or online. Such applications will be
– collectively collected, and relevant documents will be collectively dispatched to the applicants, by the
– industry and commerce bureau.
It is worth noting that, upon the reform of business registration system, shareholders of a company may on
their own determine the subscribed capital contribution and the mode of and deadline for contribution. No
minimum registered capital is required. Enterprises may need to consider whether corresponding
adjustments have to be made to their future investment plans.6
Establishment of a legal system
An arbitration court was established on the Pilot FTZ on 22 October 2013. As a platform for arbitration of
international business disputes, the arbitration court provides such legal services as arbitration consultation,
initial proceedings and trial. However, in addition to the establishment of legal institutions, legislation is
also an important part for the establishment of the legal system for the Pilot FTZ. It is essential to determine
how the power of law making is granted and how the local laws of Shanghai are made in line with the
development of the Pilot FTZ.
Tax policies
As at 31 October 2013, two tax policies for the promotion of investment and five tax policies for the
promotion of trade were introduced, details of which are as follows:
– Income tax on gain on asset valuation from such asset restructuring as external investment using
– non – monetary assets earned by an enterprises or an individual shareholder may be paid by installments
– within a 5 year period.
– The policy for paying individual income tax by installments is adopted for equity incentives granted by
– an enterprise to highly skilled employees of the enterprise or to attract those talents in short supply by
– means of shares or capital contribution.
– A project subsidiary under a financing leasing company or under a financial lease company is admitted
– into the scope of export tax refund for financing leasing.
– A duty should be levied on the goods produced, processed and sold to the mainland market by an
– enterprise through the second line based on relevant imported parts or the actual status of declaration and
– inspection.
– No tax is imposed on the machines and equipment imported by manufacturing enterprises or
– manufacturing service enterprises.
– The tax refund policy for the port of departure has been improved.
– Value added tax preference for imported cargos will be granted on the aircrafts with aircraft load of over
– 25 tons purchased oversea by domestic leasing companies or their project subsidiaries and leased to
– domestic airlines.
Moreover, if in line with the tax reform and international practice, the PRC Government will study ways to
improve the tax policies appropriate for overseas equity investment and the growth of offshore business,
and to establish a categorized supervision model for monitoring goods based on their status. In response to
the call for a 15% tax rate for enterprise income tax on the Pilot FTZ, the government officials replied that
the time had not matured. From this point, we can see that the reform of the Pilot FTZ pays emphasis on the
system rather than the policies, which indicates the shift in the PRC’s development direction .

With in-depth understanding of Chinese market of foreign investors, many of them tend to set up wholly foreign-owned enterprise to do business. Setting up wholly foreign-owned enterprises will not only enable the investors to increase marketing decision and response speeds, but also provide the greatest security for the investors to protect their scientific research confidentiality and keep centralized management intact. Meanwhile, foreign investors contribute by installment towards the registered capital, where the first installment shall be paid in an amount at not less than 15% of the statutory capital within 90 days from the date of issue of the business license, and the last installment shall be paid up within 2 years.

Required Documents for Incorporation mainly includes:

1. The feasibility study report
2. Articles of association
3. Enterprise Name Approval in Advance Notice
4. The application for foreign investment company incorporation signed by the proposed legal representative
5. Meetings Record
6. The investor’s entity qualification certificate or the natural person’s ID card
7. The appointment letters and ID cards of directors, supervisors and managers
8. The legal representative’s appointment letter and ID card
9. Certificate of assessment of capital
10. Lease contract or certificate of property rights
11. Documents or certificates for earlier setup examination and approval

Taxes Involved in the Operation of Wholly Foreign-owned Enterprise in China:

1. Corporate Income Tax: generally the tax rate is 25%; the high tech enterprises with key aided enjoy 15% preferential income tax; those enterprises qualified for small profit enterprises enjoy 20% preferential income tax.

2. Tariff, and Value-added Tax on Importation: foreign investors carrying out investment in related file or projects, shall be entitled to first taxation, and then refund, of tariff and value-added tax or enjoy the tax exempt.

3. Value-added Tax, and Consumption Tax:  The foreign investment productive enterprise being a general taxpayer shall be entitled to “Exemption, Credit and Tax Rebate” of taxation or “Collection First and Refund Later” on the self-managed export, or export on consignment, of its self-produced goods. Meanwhile, during the process of export sales, they can enjoy the tax exempt of value-added tax.

The foreign capital investment enterprise shall be exempt from tariff and value-added tax on importation and consumption tax payable on the goods imported by the trade method of processing materials supplied by customers, and processing imported materials, and exempt from the value-added tax on production and consumption tax on the exported goods produced by it. While, to those foreign capital investment enterprise categorized as “encouraged” shall be entitled to full refund of the value-added tax payable on the home equipment, falling within the scope of the Exemption Catalogue, and purchased within its aggregate investment.

4. Individual Income Tax: Foreign nationals are entitled to a monthly exemption of RMB4800, with the remainder subject to individual income tax at 3-45%. Foreign nationals are exempt from individual income tax payable on the interests from saving deposits with financial institutions

5. Staff Social Security: The enterprise will make a certain social security contribution for its employee at a percentage of the employee’s monthly salary, of which the base and proportion are calculated differently due to different living standards in different regions.

Schedule of Taxation Involved in Foreign Enterprises in Major Industries(china taxation http://www.conpak.com/China-Taxation.html)

Taxation	Tax Rate	Taxation Involved in Various Industries					Linkage
		Manufacturing	Commerce	Services	Processing with materials, processing according to samples and assembling parts supplied by investor or clients and conducting compensation trade	Representative Office
Value Added Tax	17%			–	–	–	Click for Value Added Tax details
Business Tax	3%-20%	–	–		–		Click for  Business Tax details
Consumption Tax	3%-45%		–	–	–	–	Click for Consumption Tax details
Corporate Income Tax	15%-25%						Click for Corporate Income Tax details
Real Estate Tax	1.2%						Click for  Real Estate Tax details
Land Value Added Tax	30%-60%						Click for  Land Value Added Tax details
Stamp Duty	0.005%-0.1%						Click for Stamp Duty details
Customs Duty	As provided by the Customs			–	–	–	Click for Customs Duty details
Individual Income Tax	3%-45%						Click for Individual Income Tax details