Will I get screwed in Hong Kong? Investor Visa

[zilla]

Can anyone give me some advice on whether I’m going to have any visa problems?

I am planning to incorporate a new company in Hong Kong. This business would focus on internet retail to the final consumer worldwide. Products being sold would be from Hong Kong manufacturers and distributors. 95% of sales would be outside of Hong Kong (another thing immigration likes) with the focus being selling to the USA and EU final consumers.

I have 17 years experience in this industry, with 11 years as owner of my own related businesses in the USA (something that immigration is looking for). I recently closed those businesses in the USA due to safety regulation changes for importation to the USA. I have an undergrad degree in business, and some MBA coursework completed (another thing they are looking for).

I plan to actively manage this new Hong Kong business. I want to start the business small keeping costs under control and gradually growing it. Annual sales would be $200,000 USD in the first year of operation, but has the potential to go to more than $1 million within 3 years and much more than that within 5 years. I can write a solid business plan to support.

I would like to rent a condominium or house in the suburbs to keeps costs low in a city like Tai Po. Plus it’s a nicer environment to live in. Start business from the condo to establish systems and then move that business into a warehouse within 3-6 months. One concern here is will they frown on me doing business out of my residence if I happen to be applying for the investment visa while that is my address? If this is the case I might just bite the bullet and try to find a small commercial space to rent to start out.

I will hire one Hong Kong citizen right away and will need to keep adding employees as the business grows of course- another thing that immigration likes.

I would be traveling from Hong Kong to the Philippines once every two to three weeks, but only staying in the Philippines for two to three days before returning to Hong Kong. Also, I would be traveling to the USA once every three to four months for a week at a time before returning to Hong Kong. Not sure if all this traveling would be a plus or minus.

If I can travel in this way without having to get an investor visa for the first 6-9 months I would prefer that. I am a Caucasian American which sounds like might be of some benefit in this situation from the blogs I’ve read.

Capital available to start the business is $60K USD with another $70K is stock and equipment that I will bring from the USA. It is my understanding that I could go for an Investment Visa, but not the Capital Investment Visa which required 6.5 million Hong Kong dollars.

However, I am wondering once I do apply for an investor visa and they look at how much time I’ve spent there and the fact that the business in already operational wouldn’t they frown on that and deny me since doing business while there on a visitors visa is illegal?

Also, if they only give me 10 days to get my affairs in order in Hong Kong during one of my trips (which is what I hear they do if they want you out) its really bad since I won’t be able to be there anymore to actively manage the business. How big is my risk factor that that could happen?

I will ask an immigration attorney about my situation but often they give answers that will maximize their returns and also minimize liability. I am looking for practical answers from people with experience in such matters. Any input would be greatly appreciated.

thank you.

[Beanieskis]

What's your reasoning behind not wanting to apply for the investment visa straight away? From what you say it sounds like you have the experience, funds and business plan that they might like, so why not apply for the visa from the start?

[Football16]

If you are asking about work investment visas you cannot be working from home as one of the provisions they require is suitable premises. You can keep costs down by renting a small office with a desk in it or a virtual office to start. They ask to see the leases and the business plan.

But you cannot avoid the basic cornerstones of the application for the work investment visa which are constructed as I see it to ensure that entrants to Hong Kong are not simply residents here for convenience purposes and thus not add something to the local economy and particular industry you want to be in and also hire local people.

If this is an operating business, an overseas office here maybe? Not sure of that route though.

If they just said open a company here and go at it, this place would be inundated by new residents. Thus you need to meet their criteria and know in advance that the successful visa will be one year to start with a review at the end of year one and progress against plans.

Not sure if you need an immigration consultant or lawyer here but at the end of the day you will need to provide the business plan that addresses the cornerstones for a work investment visa and also the substantiating case that shows how you meet all their criteria.

From my very limited experience it is not a slam dunk process and takes some work on your part. It is not about getting screwed so much as it is their criteria.

If you were sourcing stuff in HK that adds to your case. Saying you will source it in the US detracts from being able to beef up your section on the local economy contribution.

[denisiel]

You plan to do business here (5% at least), hire a local person, work from a home office, and operate from a HK company. You should apply for an investment visa now, try to get your leases under your company names, and hire the employee through your company.

We operate our export oriented company from our house with an entire floor dedicated to offices and that has been accepted by HK Immigration. You can rent or buy a two story house in Tai Po and run your business from there.

When granting investment visas, the Immigration Dept. is looking for investors who will help the local economy by purchasing from local companies, hiring local staff and paying taxes. You must submit business plans, invoices, contact lists, buyers lists, company bank accounts statements, etc. to prove you are actually doing business or in the position to do so. We got our investment visas without an attorney.

Unless you have a valid reason to delay, I suggest to apply now rather than create foreseeable problems. And incorporate your company asap so you can open the company bank account and make transfers into it to show Immigration Dept. that you are funding your new project as stated in your business plan.

Good luck on your new venture!

[denisiel]

Look here for Investment Visa requirements:
The Government of the Hong Kong Special Administrative Region - Immigration Department

[Football16]

Look here for Investment Visa requirements:
The Government of the Hong Kong Special Administrative Region - Immigration Department

If Denisiel has obtained a work investment visa and uses home office facilities then the normally generally understood meaning of the second item which several experts have said is important might be overcome without renting even a virtual office let alone a physical space. My misunderstanding that this means dedicated business offices might be because most of the advisors say this as it makes an application look better in your business plan if you are leasing office space. I do know that a lot of leases in high rises specifically prohibit home businesses so you need to check that provision. I say this because they will ask to see copies of the leases for premises and if the lease documents preclude operating a business, you might have a problem getting the work visa. I am not sure but it is one to get checked out.

People I have spoken to who were not successful had these types of flaws in their submissions and once in the grasp of a bureaucrat who knows the rules and sees these issues it is hard to get out of.

Evidence of Hong Kong Commitment & the 3 Cornerstones:

1. Local Jobs

2. Suitable Business Premises

3. Proofs of Funding and Business Support