Hong Kong’s penchant for being a central hub for all things business makes it an attractive opportunity for those living abroad.
With low tax rates and an infrastructure built for success, Hong Kong welcomes entrepreneurs from all over the world to participate in its dynamic business culture.
However, the same traits that make it enticing for legitimate business purposes also attract an underworld element.
Due to the proliferation of money laundering that takes place through foreign accounts within the country, the country has established strict rules to combat this criminal action.
This can make it difficult, but not impossible, to secure a bank account within the country while living outside the country.
Here’s what you need to know to open a Honk Kong business account from the Philippines.
Because of the adoption of Know Your Customer (KYC) rules to dissuade money laundering, it is significantly more complicated to establish a business account from the Philippines than it is to set up a personal account.
KYC requires a lot of additional information about your proposed business, its purpose, and all important personnel that are associated with leadership. This is to ensure that your business is legitimate and has a well-developed plan for success.
You should also be aware that if this is your first account in Hong Kong, you won’t be able to create an account entirely online as this is another countermeasure against laundering.
Before anything else, you have to make sure that your company is registered and incorporated in Hong Kong because you will need the associated documents as part of the verification process.
Registering and Incorporating
It normally takes an average of two weeks to complete this process. Here is what you will need to do to get your company registered:
- Choose your company’s official name and decide if you will register as a share-limited company or a guarantee-limited company.
- Apply through e-filing, submitting the following documents:
- Decide whether you want to receive your Certificate of Incorporation and Business Registration Certificate digitally or through the post as physical copies.
- Investigate whether you need additional licenses or permits through the Trade and Industry Department.
Establishing a Hong Kong Bank Account from the Philippines
Now that you are formally recognized, it is time to collect the documents you will need to open your Hong Kong bank account.
While there may be additional requirements depending on the situation, the typical requirements are as follows:
- Director’s ID, Hong Kong ID, Passports - Any and all documents you have that can be used to verify your identification. You must satisfy the requirements for credentials before you can continue with the process.
- Rental Lease or Property License - Either one of these or some other legitimate form as proof of your address.
- Business Registration, Articles of Incorporation, Register Books, Etc - Here is where your incorporation comes into play. Any documents that you have to prove the validity of your business are necessary to complete the process. Information on contracts, suppliers, payments received, and other proof that your business is legitimate will be expected.
- Business Plan - If your business is new and you do not have a wide variety of transaction evidence, you must submit a detailed business plan that demonstrates that you are serious about your business and have goals to achieve success that are logical and reasonable.
If you have any other documents that may prove useful, keep those close at hand as well. It’s much better to be overprepared than underprepared.
Collect these documents and have them accessible for when you complete your application process.
What Account Fees Are Involved?
While different banks have different charges and rates, there are a few standard fees you can expect to pay:
- Initial Deposit - This is the amount required as a deposit when first creating your account, usually between HK $5000 up to $50,000.
- Minimum Balance - Banks usually require that you maintain a set amount in the account at all times, and this may be from $50,000 dollars up to $500,000 in certain scenarios.
- Processing Fee - Try to find a bank that will waive this fee if possible. Otherwise, expect fees in the realm of $400 - $10,000 dollars.
It’s always a good idea to consider your options before making a selection. Different financial institutions have varying requirements for fees and provide different perks and incentives. Try to find the one that is best for your company.
One of the easiest ways to get your foot in the door with a company in Hong Kong, even when located in the Philippines, is to start an account locally with a bank that is well-established in Hong Kong as well.
While you are unlikely to get out of having a face-to-face interview as per guidelines, you can make the entire process easier and have everything set up in Hong Kong before you even have to leave your country.
Certain banks such as HSBC and Citibank have established reputations for being able to facilitate easier account creation within Hong Kong.
The trick is to set up an account with this bank in the Philippines first, so they can handle the majority of the verification process, as it will be required to set up an account with them.
With your identity and business information established, they can facilitate the opening of an account in Hong Kong, essentially vouching for you.
Through this process, by the time you travel to Hong Kong for your required interview to finalize the account, everything else will be set up and ready to go!
Remember, when you do attend the interview, dress professionally and provide a thoughtful discourse on your business. It is crucial to establish yourself as a legitimate and respectable entrepreneur to solidify your Hong Kong business account.