2006 annual survey of companies in hk representing parent companies located outside hkp. 1 2006...

2006 Annual Survey of Companies in HK Representing Parent Companies Located outside HKP. 1

2006 Annual Survey of Companies in Hong Kong

Representing Parent Companies Located outside Hong Kong


(i) Survey conducted annually sinceearly 1990s: Covers RHQs and ROs

(ii) Since 2001: Extends to cover LOs

(iii) Since 2004: Also collects views from LOs

Background


(iv) Since 2006: Revised survey name Revised definitions of RHQ, RO and LO

Background (Cont’d)


(i) To enumerate RHQs, ROs and LOs in HK representing their parent companies located outside HK

(ii) To obtain basic information of these companies

(iii) To seek views on the attractiveness of HK as a location forsetting up RHQs/ROs and LOs

Objectives


Covers companies that take charge of the operations/business in HK or in the region (i.e. HK plus one or more other places) on behalf of their parent companies (with final management control) located outside HK

Reference date: 1 June 2006

Coverage


Classification of a Company as an RHQ, RO or LO

Taking charge of the operations/business

on behalf of its parent company

located outside HK?

Non-RHQ/RO/LO

No

Geographical responsibility

?

Yes

LO

HK only

RHQ

Yes

Any managerial control over offices in the

region?

In the region

RO

(i.e. only coordinates offices and/or operations in the region)

No


Country/Territory of Location of Parent Company of RHQs, ROs and LOs

295212

114 112

594519

223156

391437

159

449

100

200

300

400

500

600

USA Japan UK MainlandChina

RHQ

RO

LO

0

No.

of

com

pan

ies


Geographical Responsibility of RHQs and ROs in the Region (other than HK)

1 073

508 481 385 384

2 182

967 784 647 666

500

1 000

1 500

2 000

2 500

MainlandChina

Taiwan Singapore Thailand Korea

RHQ

RO

0

No.

of

com

pan

ies


Views on Importance of Factors Affecting the Choice of Location for Setting up RHQs/ROs and LOs

RHQs/ROs LOs

1 Low and simple tax system 1 Low and simple tax system

2 Free flow of information 2 Corruption free government

3 Corruption free government 3 Free flow of information

4 Absence of exchange controls 4 Absence of exchange controls

5 Political stability and security 5 Political stability and security

6 Rule of law and independent judiciary

6 Rule of law and independent judiciary

Ranking in Descending Order of Importance


Views on HK’s Favourableness as a Location for Setting up RHQs/ROs

Factor

Favourable

for HK

Unfavourable

for HK1 Low and simple tax system 71% 1%2 Free flow of information 69% 1%3 Absence of exchange controls 69% 1%4 Communication, transport and other

infrastructure67% 1%

5 Free port status 66% 1%6 Corruption free government 66% 1%7 Geographical location 64% 1%8 Availability of business services and

professional support services63% 1%

9 Rule of law and independent judiciary 61% 1%10 Political stability and security 61% 1%11 Availability of financial services 60% 1%

Regarded the factor as


Views on HK’s Favourableness as a Location for Setting up RHQs/ROs (Cont’d)

Factor

14%

16%

33%

32%

Availability and cost of residential accommodation

Availability and cost of business accommodation

favourable for HK unfavourable for HK



Views on HK’s Favourableness as a Location for Setting up LOs

Factor

Favourable

for HK

Unfavourable

for HK1 Low and simple tax system 70% 1%

2 Free flow of information 67% 1%

3 Absence of exchange controls 67% 1%

4 Corruption free government 65% 1%

5 Free port status 63% 1%

6 Communication, transport and other infrastructure

63% 1%

7 Availability of business services and professional support services

60% 1%



Views on HK’s Favourableness as a Location for Setting up LOs (Cont’d)

Factor

18%

14%

31%

31%

Availability and cost of business accommodation

Availability and cost of residential accommodation

favourable for HK unfavourable for HK



Views on Overall Business Environment in HKas a Location for Setting up RHQs/ROs

Comparing June 2006 with June 2005

Deteriorated6%

No comment13%

Improved30%

Same50%

Effect of CEPA

Affected very much 7%

To some extent 44%

A little/not at all 48%

No comment 1%


Deteriorated6%

No comment14%

Improved34%

Same47%

Views on Overall Business Environment in HKas a Location for Setting up LOs

Comparing June 2006 with June 2005

Effect of CEPA

Affected very much 10%

To some extent 46%

A little/not at all 44%

No comment 1%


Views on Effect of CEPA Implemented since January 2004 on Investment Activities of RHQs/ROs

Whether investment activities affected

EffectNo comment14%

No76%

Yes10%

Setting up new business 8% expansion plans

Advancing business 2%expansion plans

Cancelling business <0.5%expansion plans

Postponing business <0.5% expansion plans


Whether investment activities affected

No comment14%

No78%

Yes8%

Setting up new business 6% expansion plans

Advancing business 1%expansion plans

Cancelling business <0.5%expansion plans

Postponing business 1%expansion plans

Views on Effect of CEPA Implemented since January 2004 on Investment Activities of LOs

Effect


2006 Annual Survey of Companies in Hong Kong

Representing Parent Companies Located outside Hong Kong

2006 annual survey of companies in hk representing parent companies located outside hkp. 1 2006...

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