Hong Kong banks are the future home for those seeking asset protection. Banking and corporate law in this region offers many attractive features and benefits for asset protection.

A September 22, 2010 New York Times article titled “Looking for banking secrecy in Asiasuggested that Hong Kong and Singapore were the new jurisdictions of choice for those looking for safe, secure and opaque offshore bank accounts. The article cites numerous sources and studies suggesting that those who once chose Switzerland for their offshore bank accounts were now creating accounts in these regions instead.

The article quotes Richard Murphy, founder of the British research organization Tax Justice Network, as saying: “Singapore is where the Swiss can now find the banking secret they have lost at home and Hong Kong is in second place.”

Asset protection in Hong Kong banks

The Hong Kong Treasury and Financial Services Office clearly does not consider this region an offshore tax haven for those trying to evade taxes in their home countries. Rather, the Office considers it an attractive jurisdiction for offshore investors and companies due to the region’s simple and fair commercial banking and tax policies.

Banks and the government in the region have a strong tradition of protecting the privacy of the bank account holder. Local laws also allow the formation of corporations that allow the identity of shareholders and beneficial owners to be protected. Hong Kong company law requires the name of at least one shareholder to appear on the public register. To maintain the anonymity of corporate shareholders, a nominee shareholder may be used for registration purposes. A trust agreement is created between the corporate shareholders and the nominee shareholder that establishes the corporate shareholders as the beneficial owners and those in control of the corporation.

There is also the advantage of not taxing capital gains or interest on deposits, and corporations are only taxed on income earned in the actual region.

The Hong Kong local government even provides bank insurance for bank accounts. During the current financial crisis, the government insured bank accounts without a maximum account limit. However, limits on the amount of 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.

For many, the ability to set up Hong Kong bank accounts and hold assets in a variety of currencies is a huge advantage in today’s chaotic financial markets. Most HK 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’s easy to see why Hong Kong is a popular choice for those looking to incorporate a business or open a bank account in the Foreign.

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