Although the OECD data exchange signature by Hong Kong is announced as inevitable by the Medias we believe this has to be tempered.

1. Hong Kong Tax Free
Hong Kong & Offshore Companies Registration with Bank Account Openings
OECD and Hong Kong
OECD data exchange signature by Hong Kong, likely not to happen soon!
Hong Kong didn't sign the OECD data exchange agreement and as of today banks will not
communicate about the beneficial owners of Hong Kong bank accounts. A consultation of
the finance and insurance sectors is conducted by the Hong Kong government and a vote
should be organized beginning of 2016.
Although the OECD data exchange signature by Hong Kong is announced as inevitable by
the Medias we believe this has to be tempered.
Numbers of Hong Kong companies are benefiting from offshore status and were initiated by
non-residents to facilitate purchases in China.
While not taxable in Hong Kong they accumulated profits (usually 5-10 % of the yearly
turnover) on their Hong Kong accounts, those profits considered as direct rewards for the
beneficial owners to compensate their personal involvement with the difficult Chinese
business environment.
Facing the obligation to declare their offshore profits it’s very likely that a lot of
entrepreneurs will lose interest for a Chinese production and turn to foreign locations which
became more competitive since the drastic increase of labor and production costs in China,
for a European importer purchasing in Eastern Europe or North Africa is appealing.
OECD data exchange signature by Hong Kong will render the Chinese’s factories less
attractive at a time of important economic pressure.
Closing of such existing trading entities will impact Hong Kong 38’000 Certified Public
Accountants, 5’500 lawyers and a vibrant financial market will be also affected. Not
mentioning the repercussion of Chinese’s factories closing down.
OECD data exchange signature by Hong Kong requires reciprocity and an advantage for
such.
Agreements with foreign governments such a Spiga’s for the US FATCA implementation
were also based on reciprocity in the exchange of information! But the US isn’t willing to
grant the same advantages they unduly obtained.
The republican congress refused to breach privacy laws in US while the democrats don’t
have the same scruples for them and for the rest of the world.

2. Hong Kong Tax Free
Hong Kong & Offshore Companies Registration with Bank Account Openings
This situation is producing a distortion of competitive advantage and presents a significant
impact as if you aren't tax compliant the best location to hide your profits will be in the USA,
the only country to get but not give away your personal information.
US based financial institutions and professional intermediaries will benefit from a totally
unfair advantage, after destroying too easily the Swiss banking secrecy advantage they are
going to make sure that they will be the only ones to keep and protect privacy.
Do what I say, not what I do.
Hong Kong people don’t hide money in Europe…
High tax countries have interest to know it all, this to enforce an heavy handed regulation,
limiting by all means the business freedom, and in the same time Hong Kong have no
advantages at all to collaborate as the number on non-tax compliant hiding funds in OECD
countries is likely to be minimum.
Hong Kong rewards and encourages entrepreneurs, in high tax countries such as France
entrepreneurs are leaving and the number of new companies and new jobs is in an eternal
fall.
Applying foreign principles which are proven to be wrong and collaborate with de-facto
bankrupt countries by helping them to squeeze the last drop of blood from their
discouraged entrepreneurs will not help Hong Kong to reinvent its future.
Hong Kong tax competitiveness is a mirage for the locals, taking into account the indirect
tax caused by inflated property prices and shortage of trained staff, the setup of a Hong
Kong company isn't that much appealing, confidentiality and bank secrecy are major
advantages.
OECD data exchange signature by Hong Kong, an obvious lack of interest to do so
Hong Kong didn't sign yet the OECD data exchange agreement and has no logical interest to
do so.
As a financial center Hong Kong have interest to retain business freedom and the
potentiality to be placed on a blacklist by some frustrated European countries should be of
limited impact for a location which is the gateway to China and the rest of Asia.
With 7 million inhabitants and low income and profit tax Hong Kong has no interest in the
reciprocity of the OECD data exchange agreement, this point being only of interest for high
tax countries.

3. Hong Kong Tax Free
Hong Kong & Offshore Companies Registration with Bank Account Openings
Hong Kong is far from being a small island with a limited economy, the protective hand of
the motherland and a high level of autonomy are de-facto enforcing Hong Kong business
freedom and respect for privacy.
With FATCA becoming a farce, the US congress rejecting the reciprocity of information
exchange, it's now clear that USA agenda is to destroy offshore financial centers advantages
(as they did with Switzerland) to regain their position.
China will decide for the OECD data exchange signature by Hong Kong
Chinese government is embarked in a long due fight against corruption, Chinese’s
entrepreneurs did since long open bank accounts in Hong Kong, Singapore, Taiwan and the
US.
As the US will not communicated about non-residents bank accounts, the future target of
mainland authorities is clearly Hong Kong, the motherland will without any doubts find a
way, should they want to stop their citizens to open foreign banks accounts and transfer
their funds from Hong Kong they will request Hong Kong to comply with OECD.
China nationalism and respect for sovereignty is fact but the respect for privacy does not
really exist as a culture, as a standard.
Being the servant of US and Europe is surely not the goal, so although the possibility of the
OECD data exchange signature by Hong Kong exist it more than likely that a Chinese way to
handle the communication will take place.
http://www.hongkongtaxfree.com