Investment vehicles
Types of investment vehicles
Legal forms of typical investment vehicles
There are four types of investment entities:
- Companies;
- Branches of foreign corporations;
- Partnerships; and
- Trusts*.
*Note: Unit trusts authorised by the Securities and Futures Commission under statutory requirements may be exempt from tax liabilities.
Setting up an investment vehicle
There is no minimum capital requirement in Hong Kong regarding the four investment vehicles.
Setting up an investment vehicle
Client spotlight
Foreign investors
Funds
Family offices / Ultra-High Net Worth Individuals (UHNWIs)
Share transfers of companies are popular with foreign investors because the stamp duty payable is lower.
Trusts are typically used by fund clients because they can invest in a wide range of properties and fund managers can manage the fund for investors. However, investors must pay management charges and fees; may have less control over underlying assets owned by the fund; and may not be able to cash out the fund at a time of their choice.
Both asset and share transfers of companies are typically used by family offices and UHNWI clients. For share transfers, stamp duty is payable at a lower rate compared with asset transfers.
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