Hong Kong needs to change its tax and limited partnership
laws to make it a more attractive venue for private equity
funds, according to sources.
At the moment, both offshore and onshore funds in Hong Kong
are exempt from profits tax. But for privately-offered funds,
only offshore funds and onshore privately-offered open-ended
fund companies are tax-exempt. Other onshore privately-offered
funds are not exempt, and have been identified as a ringfencing
problem by the EU.
Chris Sun, deputy secretary of Financial Services and the
Treasury Bureau, HKSAR government said during a recent
conference that the government has tabled a bill on providing
tax exemptions for eligible funds operating in Hong Kong.
"The unified tax regime would not differentiate between
offshore and onshore funds, and the legal arrangement would be
the same," said Sun. "The rationale is to...