February 4, 2026

The Case for Re-domiciling to Hong Kong

In our previous "Update on Hong Kong’s Company Re-domiciliation Regime" bulletin, we outlined the procedures for the Hong Kong re-domiciliation regime. With the mechanism now fully operational and active approvals being granted, this bulletin outlines the primary strategic benefits of migrating a corporate domicile to Hong Kong.

1. Administrative and Cost Benefits

For many groups, the historical rationale for maintaining a non-Hong Kong holding company was driven by factors that have evolved significantly. By re-domiciling to Hong Kong, groups consolidate their corporate administration into a single jurisdiction, avoiding duplicate overheads.

Key cost reductions include:

Elimination of Dual Compliance Infrastructure: There is no need to maintain parallel corporate records or pay annual fees to a foreign registry whilst simultaneously paying business registration fees in Hong Kong (as a Registered Non-Hong Kong Company).
Unified Corporate Secretarial Maintenance: Annual returns, significant controller registers, and regulatory filings are handled under one set of laws. This reduces the "friction costs" of managing compliance across different time zones, legal frameworks, and service provider relationships.
Removal of Offshore Substance Reporting: Re-domiciliation eliminates the requirement to file separate Economic Substance notifications and returns in a foreign jurisdiction — a compliance layer that is often redundant for entities already managed from Hong Kong.

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2. Legal Certainty and Continuity

Hong Kong’s status as a premier common law jurisdiction provides a robust foundation for corporate governance. The re-domiciliation regime is designed to ensure continuity, while the destination itself offers distinct legal advantages.

Business Continuity is Preserved: The company retains its legal identity, assets, liabilities, existing contracts, licences, and ongoing operations. There is no need to wind up or establish a new entity — removing execution risk and third-party consent requirements.
Aligned Legal Framework: For companies whose primary assets and/or commercial contracts are governed by Hong Kong law, re-domiciliation aligns the corporate personality with commercial reality. This eliminates the need for foreign legal opinions on standard corporate actions (such as financing or granting security).
Dispute Resolution: Hong Kong courts are globally recognised for their commercial expertise. Domiciling the entity in Hong Kong ensures that any shareholder disputes or insolvency matters are adjudicated in a convenient, efficient, and highly developed forum, mitigating the risk and expense of parallel proceedings in foreign courts.

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3. Tax Efficiency and Treaty Access

Hong Kong’s tax regime offers material advantages for groups whose economic substance already resides in the territory.

Competitive Corporate Tax Rate: Hong Kong applies a favourable corporate tax rate, whilst offering greater substance clarity than zero-tax offshore centres now subject to OECD BEPS pressures.
Access to Comprehensive Tax Treaty Network: Hong Kong-domiciled companies benefit from access to over 50 double tax agreements (DTAs), providing reduced withholding tax rates on dividends, interest, and royalties across major trading partners, including Mainland China, the UK, and ASEAN economies.
No Capital Gains Tax: Hong Kong generally does not impose tax on capital gains or dividends paid to shareholders, enhancing cash flow efficiency for holding companies distributing profits to parent entities or investors.

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‍4. Enhanced Access to Banking and Finance

In an environment of increasingly stringent Know-Your-Customer (KYC) and Anti-Money Laundering (AML) standards, corporate domicile plays a practical role in banking relationships.

Account Opening: Hong Kong incorporated entities are viewed as "standard" corporate clients by local and regional banks. This significantly streamlines onboarding timelines and reduces enhanced due diligence (EDD) friction.
Simplified Debt Financing: For lenders, lending to a Hong Kong company simplifies the credit approval process as well as reducing documentation cost.

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5. The "On-the-Ground" Expertise

Hong Kong offers an unmatched density of professional expertise. Unlike jurisdictions where the "mind and management" must be artificially demonstrated, Hong Kong is often where the directors, decision-makers, and advisors physically reside.

Proximity to Expertise: Having the company’s auditors, tax advisors, and legal counsel in the same city — and same time zone — facilitates faster decision-making and responsive corporate governance.
Substance Alignment: Re-domiciliation naturally aligns the company’s tax residence with its economic substance. For groups where board meetings and strategic management already occur in Hong Kong, re-domiciliation creates a coherent corporate structure that reflects operational reality.

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6. Access to Regional Capital and Market Infrastructure

Physical Ecosystem Advantage: Hong Kong offers direct access to one of Asia’s deepest capital markets. The city hosts over 200 licensed asset managers, 70+ international banks, and a concentrated network of private equity, venture capital, and family office investors. For companies seeking regional fundraising, refinancing, or ownership transitions, proximity to decision-makers accelerates execution.

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7. Strategic Access to the Mainland Market

Hong Kong-domiciled companies may be eligible for preferential treatment under the Closer Economic Partnership Arrangement (CEPA). This creates a pathway for service suppliers to access Mainland China market with lower entry thresholds — a strategic advantage unavailable to non-Hong Kong entities. For groups seeking to expand operations into the Greater Bay Area or establish service footholds in key sectors (legal, accounting, logistics), CEPA eligibility can materially enhance market access.

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Conclusion

The Hong Kong re-domiciliation regime offers more than just a statutory mechanism for transfer; it offers an opportunity to modernise corporate structures. By moving "onshore," companies can reduce administrative duplication, enhance legal certainty, unlock tax efficiencies, and leverage Hong Kong’s robust financial ecosystem to support future growth.

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How we can help

Our team includes experts with extensive prior experience practising in key offshore jurisdictions (including the BVI, Cayman Islands, and Bermuda). We are uniquely positioned to navigate clients through the dual complexities of the offshore exit and the onshore entry.

We can assist by coordinating with offshore counsel to procure the necessary legal opinions and manage exit procedures. We provide a seamless service, handling all documentation required for the application.

If you would like further information or assistance with the re-domiciliation regime, including a feasibility check for your entity, please contact us.

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