Hong Kong hosts over 2,700 family offices, attracting global ultra-high-net-worth individuals as of year-end 2023

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24th April 2024 – (Hong Kong) In a recent session at the Legislative Council, Secretary for Financial Services and the Treasury, Mr. Christopher Hui, provided a comprehensive update on the burgeoning sector of family offices in Hong Kong. This comes in response to inquiries from Hon Adrian Ho regarding the state and support of family offices in the region.

As of the end of 2023, Hong Kong hosts approximately 2,700 single-family offices, with a significant number established by ultra-high-net-worth individuals each possessing assets exceeding US$50 million. These entities not only contribute to the financial dynamism of Hong Kong but also engage a variety of professional services, enhancing the local economy.

Invest Hong Kong (InvestHK) has been pivotal in this growth through its dedicated FamilyOfficeHK team, established in June 2021. This team offers tailored support to both existing and prospective family offices. By the end of March 2024, the team had handled over 650 enquiries about setting up in Hong Kong, with interest primarily from Mainland China, ASEAN countries, the Middle East, Europe, and the Americas.

The geographical breakdown of family offices either set up or planning to establish in Hong Kong is quite telling of the global appeal of the region as a financial hub. Notably, the largest number of these offices originates from Mainland China, followed by Europe and ASEAN countries.

In terms of legislative support, the Inland Revenue (Amendment) (Tax Concessions for Family-owned Investment Holding Vehicles) Bill 2022 was passed in May 2023. This law offers profits tax exemption for qualifying transactions to family-owned investment holding vehicles that meet certain criteria, including a minimum asset threshold of HK$240 million. This initiative is part of broader efforts to make Hong Kong an attractive destination for high-net-worth investments.

Despite these encouragements, family offices are not obliged to disclose their assets under management or operating expenses to the government, and individual tax exemptions are not publicly disclosed. This confidentiality emphasises Hong Kong’s commitment to privacy and security for family offices, aligning with global standards for financial discretion.

Moreover, Mr. Hui reassured that the government does not specifically formulate hospitality standards for family offices but ensures a supportive environment for all law-abiding entities looking to establish themselves in Hong Kong. InvestHK’s role extends beyond merely attracting family offices; it includes conducting due diligence in line with statutory requirements and guidelines, ensuring a compliant and secure setup for these entities.