Why should Hong Kong businesses relocate to Singapore?
The obvious choice for an alternative Asian hub, is of course Singapore, who has just overtaken Hong Kong to be the world’s freest economy. Both Singapore and Hong Kong have shared several inherent benefits as investment hubs — minimal red tape, low regulation, and simple tax systems to name a few.
That relative equality is now of course shifting with the erosion of Hong Kong’s viability as a secure hub for international investment, making Singapore the safer option.
A shift of assets and investments from Hong Kong to Singapore may seem daunting, but the process is actually rather straightforward, albeit increasingly urgent in its necessity. Let’s take a look at your options for moving your company from Hong Kong to Singapore.
Please keep in mind that you will need to partner with a reputable Singapore Company Incorporation service provider in order to comply with the Singapore Accounting and Corporate Regulatory Authority (ACRA). This is a good thing of course, as they will help make the process as quick and easy as possible, while advocating for you during the process.
First things first, and that is reviewing your options in order to choose the optimal business structure for relocating your Hong Kong business to incorporate in Singapore. While Singapore makes it relevantly easy to incorporate into the best possible structure, there are of course positives and negatives for each.
There are three main options to choose from when choosing a business structure in Singapore.
Create a Singapore Parent Company for your Hong Kong Company
This option allows you to set up a company in Singapore that acts as the parent company for your Hong Kong operation. In time, once the transfer is complete, you will set up a second, separate Singapore company that will act as the ultimate, long-term operating company for your business.
To begin with, your second, long-term Singapore company will be wholly owned by your initial Singapore parent company, but in time you can shift the shareholding to be equal to your Hong Kong Company. You can then, in your own time, facilitate a shift of business activity from your Hong Kong Company to your long-term Singapore Company.
The benefit with this option is that you can keep your Hong Kong company operating alongside your Singapore operation. If however there are calamitous developments for your Hong Kong Company, your Singapore companies can take the operational reins, all while providing sturdy legal protection during any transition.
Once all operations have transferred from your Hong Kong company to your Singapore company, the Hong Kong company can be closed and deregistered. You can then continue to operate your Singapore company under your original Singapore parent company, or close the parent company to have a standalone company.
Read more on why you should move your Hong Kong Business to Singapore at Rikvin.com.
