SOVEREIGN TRUST (HONG KONG) LIMITED

Hong Kong has one of the highest concentrations of banking institutions in the world with 199 authorised banks and 64 representative offices as of end December 2015. Around 70 of the largest 100 banks in the world have operations in Hong Kong and its stature as a key financial centre is built on its high standard of market transparency, disclosure and prudent supervision.

A company – be it resident or non-resident in Hong Kong – will require a bank account to undertake any kind of business. Opening a business bank account in Hong Kong used to be a relatively straightforward process but, due to recent regulatory changes, it has become more difficult.

Global initiatives against tax evasion, money laundering and terrorist financing in the past decade have obliged banking regulators to impose enhanced customer identification and due diligence procedures on financial institutions, backed up by increasing penalties for violations. As a result, banks have had to adopt a risk-based approach to account opening.

Customer identification requirements vary depending upon the size and type of business. A financial institution will request information showing the legal existence of the entity, such as certified articles of incorporation, a business licence or a partnership agreement, as well as details about individuals with ownership or control over the account, including beneficial owners, signatories and guarantors.

Financial institution will further request financial statements and banking references, as well information on the purpose of an account, the source of funds, the anticipated volume of currency and total deposits, the level of revenues, and the primary customers and suppliers.

Hong Kong banks are more likely to open an account for you if you have, or are planning to have, an office in Hong Kong, employ staff in Hong Kong, have customers or suppliers or both in Hong Kong etc. In other words they are looking to see real substance in Hong Kong, both for new businesses being set up in Hong Kong, as well as for subsidiaries of foreign companies.

You may only get one chance to open a bank account in Hong Kong. As a professional services provider in Hong Kong, Sovereign has long standing relationships with a broad range of Hong Kong banks. We know the policies and criteria of different banks and can help to determine which one will be the best fit for you. We can then guide and assist you with preparing your application and supporting documentation to maximise your chances of success, before effecting an introduction to your chosen bank.

There are also a number of international banks that will open accounts for Hong Kong and offshore companies. Such banks generally only work with qualified introducers, such as Sovereign. When you have generated at least six months of account activity with an offshore bank, a bank in Hong Kong is more likely to accept your application because they can more accurately assess risk by analysing your account history. You will also have more supporting documentation in place after six months of trading.

Our fees for attending to the account opening procedures are from US$1,000, plus the costs of preparing any additional notarised documentation that a particular bank may require.

For more information, please visit the website at https://www.sovereigngroup.com/hong-kong/offshore-bank-account-opening-in-hong-kong/