Scenario: a Singapore fund wants to “listen” to the Hong Kong market for six months before siting an asset-management office. In Hong Kong, a foreign company’s representative office needs no registration if it conducts no business — the lightest model among all compared countries, but also the easiest to abuse.
Hong Kong: the unregistered representative office — lightest, and easiest to abuse
- Representative office: no Companies Registry registration needed if only liaison and market research (no trading). But the “no business” line is drawn by the IRD and actual activity — overstepping means “carrying on business” and registering as a foreign company.
- Branch (registered non-Hong Kong company): registered as a “non-Hong Kong company” — may trade fully; the parent is liable.
- Subsidiary: an independent Hong Kong company (private limited) — 1–4 day formation, separate legal person.
- Joint venture: a co-owned subsidiary — no separate JV regime.
Vietnam: ROs need licences — “light” but with an administrative “shell”
Unlike Hong Kong, Vietnam requires foreign traders’ ROs to hold a licence under Decree 07/2016/ND-CP (5 years, renewable), with no profit-making business. “Lighter” than Hong Kong in needing no registration — but Vietnam is “tighter” in that every RO sits under administrative management.
When the fund commits for real in Vietnam:
- Fund/foreign-capital management company: IRC under Investment Law 143/2025/QH15 (effective 1 March 2026) + ERC under Enterprise Law 2020 (amended by Law 76/2025/QH15, effective 1 July 2025) + State Securities Commission licence.
- Note: asset management is a tightly conditional sector in Vietnam — an RO cannot “listen” its way into providing services.
Compared: no registration needed vs mandatory licence
| Criterion | Hong Kong | Vietnam |
|---|---|---|
| Representative office | No registration (if no trading) | Mandatory 5-year licence (Decree 07/2016) |
| The “trading” line | IRD + actual activity decide | Statutory: no profit-making business |
| Branch | Non-Hong Kong company — may trade | Per licence; parent liable |
| Subsidiary | Private limited (1–4 days) | IRC + ERC |
| Asset management | SFC licence | SSC licence |
The lesson: “light” does not mean “free”
1. In Hong Kong, “no registration needed” cuts both ways. Unregistered means no protective “shell” — an IRD finding of “carrying on business” brings back-taxes and fines. Keep records proving activity stays within liaison/research.
2. In Vietnam, don’t use an RO to “test” financial services. ROs may not provide services; asset management needs a legal person plus an SSC licence. Over-eager “listening” becomes unlicensed service provision — a serious violation.
3. Funds in both places: Hong Kong is where to domicile the fund (no capital caps, clear SFC licensing); Vietnam is the market to invest in — complementary roles.
Frequently Asked Questions
Does a Hong Kong representative office need registration?
No — if only liaison and market research with no business activity. But the line is drawn by the IRD and actual activity; overstepping means ‘carrying on business’ and registering as a foreign company.
What does ‘carrying on business’ mean in Hong Kong?
The tax/administrative concept for a foreign company conducting business in Hong Kong — triggering registration as a ‘non-Hong Kong company’ with the Companies Registry. An overstepping RO falls into this.
Does a Vietnamese RO need a licence?
Mandatory — foreign traders’ ROs need a licence under Decree 07/2016/ND-CP (5 years, renewable). Every RO sits under administrative management — ‘tighter’ than Hong Kong.
What does opening an asset manager in Vietnam need?
A State Securities Commission licence plus a legal person (subsidiary: IRC + ERC). Asset management is tightly conditional — an RO may not provide services.
What licence does Hong Kong asset management need?
An SFC licence (by service type: asset management, securities advisory). One-to-four-day incorporation does not mean immediate servicing — the SFC licence is the decisive gate.
Can an RO ‘test’ financial services in Vietnam?
No — over-eager ‘listening’ becomes unlicensed service provision, a serious violation in Vietnam. ROs do promotion and research only; servicing needs a legal person plus licences.
