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Setting up a company in Hong Kong, whether a limited company or an unlimited company, requires a company registered address. Important government letters are sent to the registered address, and the registered address is also shown in enquiries on the search system. A virtual office is the choice of many start-ups. This article introduces the benefits of virtual offices and points to note when choosing one.
Choosing a company registered address
When it comes to a company's registered address, many people first think of a physical shop or office. But for small and medium-sized enterprises and start-ups, once budget and other factors are considered, finding a satisfactory location is not easy. So where else can a company's registered address be located?
Where can a company's registered address be located?
Under the Hong Kong Companies Ordinance, a company's registered address cannot be outside Hong Kong and must be an address where mail can be received and sent. There is no requirement that it be a commercial address or an actual place of business. Therefore, addresses that can be registered as Registered address options include:
A physical office or shop;
A residential address;
A virtual office.
The biggest question is this: a physical office or shop can certainly be registered, but can a virtual office be registered as the company address?
Can a virtual office be registered as the company's registered address?
Because there is no requirement that a company's registered address must also be its actual place of business, a virtual office can be registered as the company's registered address.
However, you need to check whether the operator of the virtual office you are renting holds a Trust or Company Service Provider (TCSP) licence. Under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, it is an offence for anyone to operate a business centre or virtual office in Hong Kong without a licence. If you rent a virtual office from an operator without a TCSP licence, that is also an offence.
Virtual office selection guide
Many people recommend setting up a company in a virtual office. What are the benefits of using a virtual office as the company address? If you decide to use a virtual office as your registered address, how should you choose one, and what office services will it provide? This guide explains how to choose a virtual office to help you find the most suitable one.
Why do you need a virtual office?
Because a company address must be registered when a limited company is set up in Hong Kong, and important letters are sent to that address, many people first come across the term virtual office because they need a company address. Besides providing an address, a virtual office also offers office services such as mail and parcel collection, professional secretarial services, call answering and meeting room rental. If your business does not need a physical office, a virtual office is an excellent choice.
Advantages of a virtual office
A virtual office not only solves the problem of a company address, but also offers the advantages of low cost, a better corporate image and flexible use of space.
Cost advantage
Renting a physical office is very expensive. Besides the high rent, you must buy and pay for fit-out and furniture, and every month you also pay water, electricity, internet and other bills. Most virtual offices offer a choice of service plans, from as little as a few tens to a few hundred Hong Kong dollars, and extras such as a dedicated phone number can be bought separately. The cost difference between a virtual office and a physical office is huge, so a virtual office is more cost-efficient, and the money saved can be invested in business development and technical support.
A better corporate image
Image matters a great deal to a business. As the saying goes, fine clothes make the person. When the address on your business card is in a well-known building, a core business district or a prime industrial area, it improves your corporate image and builds more trust. A business can choose a suitable address for its type of business. For example, financial services firms can locate in areas such as Causeway Bay, Central and Sheung Wan, while retailers or manufacturers can choose locations in industrial areas.
Flexible lease terms and space
The lease term of a virtual office is flexible and can be discussed with the operator. It is usually 6 to 12 months, and of course the longer the term, the better the discounts. Besides flexibility in time, there is also flexible use of space. Many businesses now hold meetings by video, but some still need face-to-face discussions. Some virtual offices offer meeting room rental, giving businesses a private meeting space.
What types of business suit a virtual office?
Virtual offices are not limited to start-ups. With globalisation, the growth of the internet and changes in business models, more and more businesses no longer need to work from a physical office and can run their companies normally with a virtual office.
Types of business suited to a virtual office:
Start-ups;
Small and medium-sized enterprises;
Freelancers;
Home-based businesses;
Multinational companies setting up branch offices, etc.
Things to note when renting a virtual office
When comparing virtual offices, besides making sure there is a sufficient range of services, you also need to note the following two points:
Choose a provider with a valid licence
Operating a business centre or virtual office in Hong Kong requires a TCSP licence, otherwise it is an offence. If a business centre or virtual office does not hold a TCSP licence, you, as the tenant of that virtual office, are also committing an offence!
Understand the fees
Some virtual office services are not free. Before renting, besides knowing what services the provider offers, you also need to find out whether there are hidden charges. This applies especially to low-priced virtual offices that still offer a wide range of services, so check carefully for hidden charges or special pricing methods. Otherwise you may end up paying hidden charges later and losing out.
Other virtual office services
To meet the needs of different businesses, virtual offices can provide a variety of supporting services, which are generally charged depending on the service provided:
Mail collection and forwarding
As the company's registered address, it will inevitably receive many important letters. Most virtual offices notify the client first after receiving mail and then forward it, so that clients do not miss any important mail.
Call forwarding
A dedicated phone number is provided. Virtual office staff answer calls on your behalf, and calls can be forwarded instantly to a number you specify.
Change of registered address
Updating the client's business address to the virtual office address.
Digital nameplate
Under the requirements of the Companies Registry, a Hong Kong company must display its name at its registered office and place of business, in a position where visitors can easily see it. Most virtual offices provide a digital nameplate that displays your company name.
Company card printing
As the company address changes, considerate virtual offices also provide business card printing, so that clients can update the address on their cards.
Meeting room rental
A virtual office does not provide a physical workspace, but some clients may need a formal meeting venue. Some virtual office services therefore offer single-use meeting room rental as an extra.
Summary
A Hong Kong virtual office lets a business work remotely and rent an office address, so it can use its funds in other areas at low cost, and the address also improves its corporate image. Even without a physical office, a business can use conveniences such as the mail handling service, cloud working and virtual phone numbers, giving it more freedom to grow. When renting, however, always first confirm that the virtual office holds a TCSP licence, and check how it charges. SetupHK can provide you with a suitable virtual office service, together with one-stop company formation and company secretarial services, so you can concentrate on growing your business with peace of mind.
Further reading: “[Hong Kong company formation guide] The process, costs, timeline and FAQs of setting up a company in Hong Kong explained”
