Hong Kong to ease asset requirements in cash-for-residency scheme Hong Kong will relax the asset criteria for its cash-for-residency scheme and allow funds brought in through certain family investment tools to count towards minimum requirements, with authorities predicting the programme will pump HK$24 billion (US$3.08 billion) into the city. But one economist said on Tuesday he doubted the changes would be enough to draw much business away from regional rival Singapore, which was “very competitive” in its push to serve as a hub for family offices. The Financial Services and the Treasury Bureau, along with InvestHK, announced that applicants to the New Capital Investment Entrant Scheme (New CIES) would only need to prove they had at least HK$30 million in assets or equity for the past six months, down from the current two years. Net assets or equity jointly owned with the applicant’s family members will be taken into consideration when calculating whether the threshold has been met. Additionally, investments made through family-owned investment holding vehicles (FIHV) will count towards requirements. “Since the launch of the scheme, we have been liaising closely with the industry and are continuously working on further enhancements,” Secretary for Financial Services and the Treasury Christopher Hui Ching-yu said. “We believe these measures will encourage more investors to join the scheme and can create synergy with the tax concession regime for family offices, thereby promoting the development of family office businesses in Hong Kong.” Chief Executive John Lee Ka-chiu has made it a focus of his administration to turn Hong Kong into a hub for family offices, pledging in last year’s policy address to expand tax concessions for such wealth management companies. The measures will take effect in March, one year after the government launched the scheme, which allows applicants to invest at least HK$30 million in funds, stocks, bonds or other vehicles in exchange for residency for their family in the city. Investments made through private companies wholly owned by the applicant in the form of a FIHV or a family-owned special purpose entity under such vehicles will now count towards the HK$30 million investment requirement under the programme. Authorities said this change would “create synergy between the New CIES and the establishment of family offices in Hong Kong”. More than HK$24 billion was now expected to enter the city through the programme, authorities said without specifying the time frame. They said in September the figure would be HK$15 billion. Alpha Lau Hai-suen, InvestHK’s director general of investment promotion, said the number of applicants in the first 10 months of the scheme’s launch exceeded what was recorded during the same period for its predecessor programme, which began in 2003. “This reflects the strong confidence of investors in Hong Kong,” she said. “We will continue to work closely with professionals and service providers to further promote the scheme to high-net-worth families around the globe.” But economics scholar Simon Lee Siu-po said the changes might not be enough to lure investors away from Singapore. The country has its own cash-for-residency scheme known as the Global Investor Programme (GIP). Singapore was “very competitive” in its push to be a hub for family offices and was also considered to be “safer” politically, he said, adding: “Some may simply diversify between [Hong Kong] and Singapore.” Under the GIP, applicants can establish a single-family office with at least S$200 million (US$146.4 million) in assets under management, of which at least S$50 million must be allocated into specific investment categories. Under the New CIES, HK$27 million of the HK$30 million investment requirement must be invested in financial assets such as equities on the Hong Kong stock exchange, debt securities, cash deposits, subordinated debts, eligible collective investment schemes and limited partnership funds. The remaining HK$3 million must be invested in areas related to the development of the innovation and technology (I&T) sector, and other strategic industries, which will go into a New CIES investment portfolio managed by the Hong Kong Investment Corporation and used to support the city’s start-ups and IT industry. https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3293701/hong-kong-ease-asset-requirements-cash-residency-scheme (ICE HONG KONG)

Fonte notizia: South China Morning Post