Hong Kong banks are the future home of those seeking is asset protection. Banking and corporate law in this region offer many attractive features and benefits for asset protection.
A September 22, 2010 New York Times article entitled “Seeking Bank Secrecy in Asia” suggested Hong Kong and Singapore were the new jurisdictions of choice for those seeking offshore banking accounts that are safe, secure and opaque. The article cites numerous sources and studies suggesting that those who once chose Switzerland for their offshore bank accounts were now creating accounts these regions instead.
The article quotes Richard Murphy, a founder of the British Research organization Tax Justice Network, as saying, “Singapore is where the Swiss can now find the banking secrecy they’ve lost at home and Hong Kong is a close second.”
Asset Protection in Hong Kong Banks
The Hong Kong Financial Services and Treasury Bureau, clearly does not consider this region as an offshore tax haven for those trying to evade taxes in their home countries. Rather the Bureau considers it as an attractive jurisdiction for offshore investors and businesses because of the region’s simple and fair business banking and tax policies.
The banks and government in the region have a strong tradition of protecting bank account holder’s privacy. Local laws also permit the formation of corporations that allow the shareholders and beneficial owner’s identity to be protected. The Hong Kong corporation law requires the name of at least one shareholder appear in the public registry. To maintain corporate shareholder anonymity a nominee shareholder can be used for purposes of the registry. A trust agreement is created between the corporate shareholders and the nominee shareholder establishing the corporate shareholders as the beneficial owners of and as those in control of the corporation.
There is also the advantage of no tax on capital gains or deposit interest, and corporations are only taxed on income earned in the actual region.
The local Hong Kong government even provides bank insurance for bank accounts. During the current financial crisis the government insured bank accounts without a maximum account limit. However, the limits on the amount of the deposits covered by government insurance may be reinstated as the crisis eases so check with the bank before opening an account to determine the maximum deposit covered by government insurance. You may find it beneficial to open more than one account if your deposits exceed the limit.
Many find the ability to create Hong Kong bank accounts and hold assets in a variety of currencies a big advantage in today’s chaotic financial markets. Most of H.K’s banks also offer online banking including transferring funds between accounts and currencies online.
Add to all of the above the ease with which foreigners can open a bank account and/or create an offshore corporation and it is easy to understand why Hong Kong is a popular choice for those looking to incorporate a business or open a bank account abroad.