Representative Office

A Representative Office (RO) in Hong Kong is a business presence established by a foreign company solely for non-profit-generating activities. It acts as a liaison between the parent company and local partners, facilitating marketing, sourcing, or coordination tasks without conducting any direct sales or service delivery.

The key functions include brand promotion, market observation, communication with partners or suppliers, and participation in exhibitions or trade events. It’s commonly used by international businesses exploring the Hong Kong or Greater Bay Area market before establishing a permanent operation.

No, a Representative Office in Hong Kong is strictly prohibited from engaging in profit-generating activities. It cannot provide services or sell products to clients, issue invoices, negotiate commercial contracts, or receive payments in any form.

The Hong Kong Companies Ordinance classifies a Representative Office as a non-trading entity. Any attempt to bypass this restriction could result in legal penalties, deregistration, and reputational damage. Companies that wish to conduct sales, sign agreements, or manage customer relationships must consider registering a Branch or forming a Hong Kong company Subsidiary instead.

To set up a Representative Office in Hong Kong, the foreign company must notify the Companies Registry of its intention to operate locally for non-commercial purposes. While no separate incorporation is needed, the entity must still comply with local administrative rules.

– Complete and submit Form NN1 (Application for Registration of a Non-Hong Kong Company) – Provide certified copies of its Certificate of Incorporation and Articles of Association
– Appoint a local representative responsible for administrative duties
– Provide a registered business address in Hong Kong
The registration process usually takes 7 to 10 business days, assuming all documents are complete and properly certified. Non-English documents must be translated into Chinese or English and notarized. The Companies Registry provides full guidance on non-Hong Kong company registration.

The legal framework for setting up a Representative Office in Hong Kong is relatively straightforward, but must be followed closely to ensure compliance.

Under Part 16 of the Companies Ordinance (Cap. 622), a foreign company may establish a business presence in Hong Kong without incorporation if it doesn’t engage in revenue-generating activities. While the Representative Office is not subject to Hong Kong’s company formation laws, it must:
– Maintain a physical presence (registered address)
– Appoint at least one authorized individual to represent the office
– Submit required documents to the Companies Registry
– Use the name of the foreign company for all communication and branding

Document preparation is a critical part of establishing a Representative Office and ensuring compliance with Hong Kong regulations.

To register a Representative Office, the foreign company must provide the following:
– A certified copy of the Certificate of Incorporation (from the home country)
– A certified copy of the company’s Articles of Association or Memorandum
– The latest audited financial statements (if available)
– A completed Form NN1
– Details of the local Hong Kong representative
– Proof of a registered address in Hong Kong
– Certified translations if documents are not in English or Chinese.

Understanding the restrictions of a Representative Office is essential before selecting the right business structure in Hong Kong.

A Branch Office is an extension of the foreign company and can conduct full business operations in Hong Kong, including signing contracts and generating income. However, it does not enjoy limited liability and must file audited accounts. A Representative Office cannot trade or earn revenue but offers simplicity and minimal tax or compliance obligations.

A Subsidiary is a separate legal entity incorporated under Hong Kong law. It can operate independently and is fully liable under local jurisdiction. It is often preferred by companies intending to scale operations, hire staff, and sell products or services in Hong Kong. Compared to a Representative Office, a Subsidiary offers full trading rights but also comes with increased regulatory and tax obligations.

Yes, a Representative Office may hire employees to support its non-commercial activities and open a corporate bank account under certain conditions.

The office can employ both local and foreign staff for administrative, liaison, and market research roles. It must comply with Hong Kong’s labor laws, including MPF contributions, employment contracts, and employee protections. If hiring foreign nationals, the office must obtain Employment Visas through the Immigration Department. Please refer to our visa services for more information.

While opening a bank account is allowed, Hong Kong banks may impose strict requirements. Financial institutions often require detailed documentation proving the office’s non-trading status, local presence, and beneficial ownership. With Themis Partner’s help, you can prepare a compliant application to meet bank due diligence requirements and successfully open an account.

A major advantage of a Representative Office is the low tax exposure. Since it cannot trade, it is generally not liable for profits tax under the Inland Revenue Ordinance.

A Representative Office is not subject to profits tax because it performs no trading activities. However, if it begins to engage in commercial transactions, the Inland Revenue Department may impose taxes and penalties. Any staff hired locally will be subject to individual income tax and employer obligations, including MPF contributions.

Although it has no requirement to file annual returns or audited accounts, a Representative Office must notify the Companies Registry of any changes to its local representative, address, or parent company details. Ensuring compliance with these obligations helps maintain good standing and avoids unnecessary legal complications.
Appointing a qualified accountant for Accounting & Audit Services is critical. Failure to comply can result in penalties and legal prosecution.

Choosing a Representative Office is ideal when a foreign company wants to explore the Hong Kong market in a low-risk, low-cost manner.

Common use cases include market research, relationship management, attending trade fairs, sourcing products, or coordinating with regional suppliers. This structure is also suitable for foreign financial institutions, logistics providers, or tech companies gathering data or preparing future operations.

A Representative Office in Hong Kong is an ideal choice for foreign companies that need a lightweight, compliant, and strategic presence in Asia’s financial center. It enables valuable market engagement while avoiding the complexity and tax obligations of a full trading entity.

Themis Partner provides end-to-end services for setting up Representative Offices, including document preparation, certified translations, company registration, employment support, and visa processing. Contact our legal experts today to start your Hong Kong business journey with confidence.

Explore our Representative Office Services or Contact us for a custom solution tailored to your expansion goals.