Category: News (CNS)

Dear Colleagues,

Starting from 27^th Dec 2023, the 2^nd phase of the law about Unique Business Identifier (“UBI”) takes force.

The main idea of the changes is that start from 27^th Dec 2023 Business Registration Number (“BRN”) (i.e. first 8 digits of the number which can be found in Business Registration Certificate) will become Unique Business Identifier (“UBI”).

This number “UBI” will also be implemented as the number in the 2^nd chief company document: Certificate of Incorporation (“CI”).

Now let’s see how these changes influence our business practice.

• BRN will be officially the main number for communication with Inland Revenue Department and Company Registry;
• No any actions are required for CIs, which already were issued before the designated date. But in the case you will need the updated number for some reason, there’s special form for this;

As usual, clients of Asia Corp Prom has nothing to worry about. We are familiar with all the changes and we will follow up correctly everything.

The official document you can find by clicking this link: Companies Registry External Circular No. 3 / 2023

Dear Colleagues,

We would like to draw your attention to the changes in HK tax legislation which occurred recently. The changes are related to companies’ “no-activity” reporting.

https://www.ird.gov.hk/eng/ppr/archives/23040301.htm

“Starting from this year, all corporations and businesses, regardless of the amount of their gross income and the mode of return filing, must submit their profits tax returns together with all supporting documents (including financial statements and profits tax computations). “

In other words, starting from this year April, if the company claims “no commercial activity” it should provide profit tax return together with Audit report.

Besides, financial statement should include at least all government fees, company secretary charges or registered address charges and other compulsory charges. All these charges occur anyway if they company is not dormant status and even if the company claims “no commercial activity” in profit tax-return.

We as usual recommend all our clients to do accounting base on the HK ordinance.

China Income Tax is the standard and basic corporate tax in China. Its standard rate is 25%.

But besides standard rate, many companies may be entitled for more preferential rate, among them:

– companies, which may be qualified as high-tech companies, are entitled for 15% tax rate;

– companies, which may be qualified as engaged in environment protection, are entitled for 15% tax rate;

– there’s also a long list of territories and industries, which are entitled for 15% tax rate, for example corporates from Nansha district, Hainan district and so on;

We would like to pay additional attention to tax burden for small-scaled companies. Most of our clients may be classified to this category.

For small-scaled companies with annual profit not exceeding 3 million RMB, and for companies which may be classified as thin profit business, the effective income tax rate from 1^st Jan 2022 up to 31^st dec 2024 is only 5%. And for companies with profit less than 1 million RMB the effective tax rate is only 2,5% for period start from 1^st Jan 2021 up to 31^st dec 2022 and the grace period might be prolonged.

This income tax rate is surely one of the lowest in the world ever.

By clicking the link below, you can download bank calender for 2023.

It’s a wonderful tool for planning your international payments. Our company every year prepares it for valuable clients to faciliatate their payment rotine!

Bank Calender 2023 year

New Inspection Regime of the Companies Register (“the Register”) under the Companies Ordinance (Cap. 622) (“CO”) takes force on 24th October 2022.

The main changes are related to the search of public information in Company Registry.

The information on companies was open to public before the law takes force.

Starting from 24th October the Company Registry Search will be partially closed to public. Information on directors and shareholders will be shown just partially. Thus only 4 last numbers or letters of identity document number or name will be visible for public access.

Besides, the changes will also influence the residential address of the individuals, which must be hidden from the public access. Only correspondence address now will be in open access for the public.

The full access to company registry information from now on will be available only for professional companies, like company secretary, lawyers, auditors and so on. So the required information might be received through the form of official inquiry from the professional company.

All clients of Asia Corp Prom Services Company Limited (TCSP licensee) will get the correspondence address as our company address by default.

By clicking the link below, you can download bank calendar for 2022.

It’s a wonderful tool for planning your international payments. Our company every year prepares it for valuable clients to faciliatate their payment rotine!

Bank Calendar 2022

Many clients ask us a question: why the banker has closed my account? Or can tell the story of how their business or nationality is not accepted by the banker anymore …

To tell the truth, the answer for this question is not that obvious.

First of all, we would like to say that there are different banks (payment systems), different jurisdictions. Financial institution itself can go through different periods of its development and their attitude to different types of businesses and jurisdictions may change as well. It may be caused by external reasons (like sanctions pressure, changes in banking industry regulations), as well as internal reasons of financial institution itself. Thus while answering the question, why the banker has closed my account, we should count all that reasons as well.

Based on these factors, financial institutions dealing international clients fall into different categories itself:

• Bankers which can accept middle range risk;
• Bankers which can accept low range risk.

We understand the risk as the sum of factors, which banker is evaluating while making a decision of possibility of work of one client. That may be nationality of the director and shareholder, the possibility to arrange online interview, the business nature, countries which are used for incoming and outgoing payments and so on…

Banks, which can accept higher risk is the topic for another conversation. We shall revert to it later. In most cases, this kind of bankers are in the low-quality jurisdictions and have limits on their usage and features.

Banks, which can accept only low risk we won’t regard here as well, because possible ways of cooperation with them are very limited.

First of all, we should consider middle risk banks. Most of international businesses and nationalities of their beneficiaries pose certain risk to the banker by its nature. And there are this kind of financial institutions in Hong Kong and Europe, although they are not many. And as it’s being spoken above, the policy of the banker may change by itself anytime.

И такие финансовые учреждения есть и в Гонконге, и в Европе, хотя их и не так много. Как говорилось выше, политика самого банка в отношении риска очень точечно может изменится в любой момент.

Our professional team will help to understand which kind of banker is the most suitable for your needs and requirements, we also be pleased to help your account work as long as possible. But of cause, there are many things which depend solely on the client.

Let’s say, what the banker needs: normal clear real business with minimum risks.

What banker doesn’t need: non-clear non-transparent not-real business with high risks.

There are hundreds of people working in the bank who’s task to evaluate risks of their clients, and these people and the system itself have certain algorithms how search for the risks and evaluate them. Base on this knowledge, let’s discuss obvious merits and demerits, which increase and decrease risks for the bank.

Pluses (what lowers the risk for the banker)

• Real physical office;
• Staff and payments on their social taxes;
• Payment on taxes;
• Accounting and audit;
• All the documents submitted to the banker are real;
• Quality of your accounting policy is high, it’s easy notice on the documents you submit to the banker;
• The number of transactions match the number of staff;
• There’s web-site, and marketing efforts of the company are obvious;
• The activity of the company is specialized and they are dealing with partners of the same industry;
• Partners of the company are trust-worthy suppliers and clients which also have web-sites, and marketing efforts in the industry;
• The activity of the company is transparent and acceptable for the banker;
• Background of the key management/owner is relevant with business of the company;

Minuses (what increases the risk for the banker)

• The absence of real office;
• The absence of staff and payments on their social insurance;
• The absence of any payments on taxes;
• Fake accounting and shipment docs submitted to the banker;
• No accounting and audit;
• The absence of accounting policy in the company;
• The number of transactions doesn’t match the number of staff;
• No web-site, no any marketing efforts;
• The company’s business is not specialized and doesn’t match their partner’s major activity;
• The work with sanctions or high-risk regions or banks;
• Your partners are not clear companies, they don’t have web-sites, any marketing efforts;
• Change of business model including trading cycle, product;
• Frequent change of company structure (directorship and ownership);

The list may be continued, but we don’t mention really obvious things here, like cashing and one-day transactions and so on…

While during analyses, you find more minuses, the possibility of your account to be closed or simply not opened is high.

Obviously, not all the clients are ready to hire a real office and additional staff and so on…That’s true, but there are many aspects which can be followed with minimum efforts and resources, once you air to build the patter of your work smart and lower the risks for the banker to work with you.

We have enough SMEs, which successfully conduct their businesses, minimizing those risks.

We have big clients, who minimize the risks totally, obtaining great advantages of international accounts usage in their business.  

We are pleased when our professional services help people build their business. Contact professionals and you will succeed.

International payment platforms emerged on the market not long ago. In the beginning we heard many questions like what it is? how it can be used? what is their difference with traditional bankers?

Please note! That in this article we are not going to review payment platforms related to cryptocurrency and stock exchange products, we shall not consider traditional payment gateways for online retailers as well. Here we mostly focus on traditional banking tasks, like international trading, international logistics and bank solutions with pure bank account for online retailers worldwide.

Since 2014 in the era of new global crises and new sanctions’ restrictions on businesses worldwide, banking industry has faced significant changes. Changes which modern people would hardly believe a decade ago. International and local regulators made decision to finish money movement freedom era, banking secrecy has become not an inviolable matter, new terms like banking risks, banking insurance and fines had appeared in business; as the result bankers started to close bank accounts of the clients where the risk of client’s operation they found not suitable for them, thousands of restrictions appeared for capital movement between countries, currencies and bankers. One of the results was the fact that banking account was almost impossible to open for some businesses and some passport holders. Secondly, one more important thing, which happened in 2020 was a global pandemic, which made visit to another country for bank account opening meeting almost impossible. Thirdly, electronic commerce was developing so fast, that traditional bankers couldn’t catch all the trends with new products launching. Grounds and features of these processes we may look more closely in other articles. It’s fantastically interesting.

But it’s really an interesting fact, that at the moment when it had become almost impossible to open bank account for some passports and businesses, solution appeared. And solution was payment platform. International payment platform – it’s financial organization, which has strong arrangement with the traditional banker or bankers and provide banking services to their clients by means of their partners, i.e. traditional bankers.

So what are the differences between international payment platforms and traditional bankers?

– Payment platform can use in its business process not only one banker, sometimes these bankers are in different parts of the world, thus payment platform may provide great possibilities in cross-border payments with different currencies.

– The base of payment platform is high-quality online platform, which should be easy-to-use, high-tech, and on-going developing.

– Usually payment platforms have more possibilities to accept more types of businesses and passport holders from higher risk countries. Sometimes it’s impossible to open bank account in a certain bank for certain type of business under certain passport holder as the beneficiary. But that may become possible in the payment platform which is using the same banker for their payments. It sounds untrue. But it’s really the fact. Furthermore, the major shareholders of payment platforms usually are traditional bankers, who really understand that they need more instruments and more space for development, which heavily regulated traditional banking sphere are not able to provide to them.

– More instruments for business operation. Some payment platforms have integrated systems for work with online retailers and online platforms, like Amazon, Ebay; some payment platforms have special conditions for currency exchange; some are specializing on financing some types of businesses, online retailers for example.

– Limit services of payment platforms. Of cause, payment platforms lack some services, which traditional bankers can provide. For example, they can’t accept and issue checks, work with letter of credit and so on. And the most important limit for some payment platforms, that they have to provide their company name to act as beneficiary and remitter for their client’s payment instructions.

It’s not the full list of all the differences between traditional bankers and payment platforms, but we suppose that those which are discussed above are the most important to consider. 

So what should the clients pay attention first of all if they consider to choose payment platform for their business?

– Jurisdiction. Of cause, you need to consider which jurisdiction the banker of payment platform is stationing. Some offshore jurisdictions may offer greater functions, but it doesn’t make sense if your partners neither can arrange payment there nor receive money from the jurisdiction.

– No doubt, that payment platforms which can provide their clients trustworthy payment instructions with beneficiary and remitter under client’s name, have great advantages to compare with the payment platform which can only show payment platform’s name as beneficiary and remitter. 

– You also should consider the payment route. Payment platforms which can provide clear payment route of correspondent well-known trustworthy banks in good jurisdictions for your payment routine have strong advantages for your business.

I would say that above criteria are fundamental while choosing payment platform for your business. After these criteria, you can continue to value other important things like: the possibility of opening account in the payment platform, banking commissions in operation, functions and usability of internet banking, currency exchange rates, possibilities of payment platform for financing your business, integrating it to your online business and so on.

This theme is very wide and actual. In future, we shall continue to introduce different payment platforms and their features as well as more actual subjects related to payment platforms.

And of cause, if you have questions on choosing and working with payment platform, we recommend you to seek for professional advice of CorpProm specialists.

It’s clear information to most of us that recent years Amazon attracted thousands of suppliers from all over the world to its trading platform in USA and Canada, but also to some other countries, like Germany, and Mexico.

There’s nothing surprising about it, since Amazon offered the most valuable thing, it’s the biggest and the richest retail market in the world together with easy to understand and maximum transparent platform for work in the matter of logistics, finance and marketing. 

Many suppliers studying the work with Amazon trading platform question themselves with important issues. How to do business in this retail in legally and correct way, how to arrange profit return to their personal bank account, how to arrange payment to suppliers. It’s obvious that their home jurisdiction is often not the correct way to choose. Some country’s legislation doesn’t imply offshore business and has foreign currency restrictions.

We would like to recommend the work with Amazon using Hong Kong limited company. And there are many grounds for this. Let’s talk them in more details.

 

1. Registration of Hong Kong takes only one week. And there’s no necessity to come to Hong Kong.

2. Registration fee in general takes only 600 USD.

3.Total annual expenditures on limited company start only from 900 USD.

4. There are very little restrictions on nationality for limited company in HK. All restrictions are mostly related to companies in the UN sanctions list.

5. Jurisdiction in one legal field with China, and it’s easy to notice that most of real manufactures are in China.

6. Company in Hong Kong and retail business in Amazon provide rather reliable ways to open account in reliable financial system.

7. The English language is official language in Hong Kong, that’s why most of the law and requirements on accounting are easy to grasp.

8. It’s really easy to do accounting. Furthermore, it’s really hard to imagine more simple and more transparent requirement for accounting than in Hong Kong. The first accounting check starts only after 1,5 years from commencement day.   

9. Easy to understand taxation system and the lowest profit tax in the world. The only tax, which trading company with foreign employees need to pay is profit tax, which is only 8,5 % of net profit for companies with net profit lower than 4 million Hong Kong dollars. Furthermore, there are legal ways to lower the tax burden and the government usually annually supports the business with tax allowance.

10. The last and one of the most important things is existence of reliable partner in the name of CorpProm. And we are always here to support you in the questions of registration, company service and bank communication.

 

So dear colleagues, if you are already in Amazon or just thinking over Amazon system – limited company in Hong Kong with the reliable partner CorpProm – is the right option!

Many companies face the problem of notarization of documents at some point of work. In Hong Kong documents can be notarized in High Court, by public notary and by certified public accountant (CPA)/Auditor. This article will introduce the list of documents that can be apostilled by High court.

A document can be apostilled (type of legalization) by High court and thereby will have a legal force. Meanwhile Notary and CPA confirms the authenticity of signatures, documents, etc.

An apostilled document can be as follow further. Please note that no any documents are accepted by the High Court o

Hong Kong. For verification the original document must be provided.

• Marriage certificate
• Certificate of Absence of Marriage Record
• Certificate of Registered Particulars
• Birth and Death Certificate
• Business Registration Certificate
• Certificate of Incorporation
• M&A

Our colleagues will clarify what documents can be certified and the best price offered.