2010 SCoRPP. 1

2010 Annual Survey of Companies in Hong Kong

Representing Parent Companies

Located outside Hong Kong

政 府 統 計 處Census and Statistics Department

2010 SCoRPP. 2

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

(ii) To obtain basic information of these companies

(iii) To seek their views on HK as a location for setting up RHQs/ROs and LOs

Survey Objectives

2010 SCoRPP. 3

Covers companies in HK taking charge of business/operations in HK or in the region on behalf of parent companies located outside HK

Does not cover companies in HK which are funded by investment from outside HK and manage the business in HK or in the region independently but not on behalf of investors

Survey Coverage

2010 SCoRPP. 4

Survey Coverage

• RHQs + ROs + LOs ≠

Total no. of companies in HK with investment from outside Hong Kong

2010 SCoRPP. 5

Survey Targets

Parent companies located outside HK

Companies in HK representing parent companies located outside HK

>

( > 6 561) ( 6 561)

2010 SCoRPP. 6

First working day in June

Survey Reference Date

1 June 2010

2010 SCoRPP. 7

How is a company classified as an RHQ, RO or LO?

Taking charge of

business/operations on behalf of

its parent company

located outside HK?

Non-RHQ/RO/

LO

No

Yes Geographical responsi

bility?

LO

HK only

RHQ

Yes

In the region

Any managerial control over offices in the

region?

RO

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

No

2010 SCoRPP. 8

6 397

1 252

2 3282 817

1 285

2 353

6 561

2 923

1 000

2 000

3 000

4 000

5 000

6 000

7 000

RHQs ROs LOs RHQs+ROs+LOs

20092010

No. of RHQs, ROs and LOs in HK Representing Parent Companies Located Outside HK

No.

of

Com

pan

ies

2010 SCoRPP. 9

100

200

300

400

500

600

700

USA Japan MainlandChina

UK

RHQ

RO

LO

0

1139%

998%

22417%

28822%

Country/Territory where Parent Company was located

No.

of

com

pan

ies

1987%

52818%456

16%44615%

Note: The top 4 countries/territories shown in terms of total no. of RHQs, ROs and LOs.

1948%162

7%

40517%

52922%

2010 SCoRPP. 10

500

1 000

1 500

2 000

2 500

MainlandChina

Taiwan Singapore Korea Japan

RHQ

RO

0

54323%

53723%

68729%

74632%

1 88180%

30023%

30624%

41732%

40932%

1 10286%

Geographical Responsibility of RHQs and ROs

in the Region (other than HK)

No.

of

com

pan

ies

Note: The top 5 countries/territories shown in terms of total no. of RHQs and ROs having responsibility for the business/operations there.

2010 SCoRPP. 11

250

500

750

1 000

1 250

1 500

RHQ

RO

LO

0IE trade, wholesale

and retailProfessional,business and

educationservices

Financingand banking

ManufacturingTransportation,storage and

courier services

13511%

13210%

62449%

21116%

665%

1938%

1 18650%

42818%

25711%

753%

2729%

1 08837%

48216%

62221%

863%

Major Line of Business of RHQs, ROs and LOs

Note: The top 5 major lines of business shown in terms of total no. of RHQs, ROs and LOs engaged in the lines of business concerned.

No.

of

com

pan

ies

2010 SCoRPP. 12

250

500

750

1 000

1 250

1 500

RHQ

RO

LO

0IE trade,

wholesale andretail

Manufacturing Financingand banking

Transportation,storage and courier

services

Professional,business and

educationservices

17213%

12810%

45435%

44935%

13310%

1757%

30413%

87437%

84036%

2219%

28910%

81328%

78327% 667

23%

2639%

Major Line of Business of Parent Companies

No.

of

com

pan

ies

Note: The top 5 major lines of business shown in terms of total no. of RHQs, ROs and LOs with parent company engaged in the lines of business concerned.

2010 SCoRPP. 13

Views on Importance of Factors for Choosing a Location for Setting up

RHQs/ROs and LOs

*In descending order of importance

RHQs/ROs*

1. Simple tax system and low tax rate2. Free flow of information

3. Corruption-free government

4. Absence of exchange controls5. Political stability and security

LOs*

1. Simple tax system and low tax rate2. Free flow of information

3. Corruption-free government

4. Absence of exchange controls

5. Political stability and security

2010 SCoRPP. 14

Views on Importance of Factors for Choosing a Location for Setting up

RHQs/ROs and LOs

*In descending order of importance

RHQs/ROs*

1. Simple tax system and low tax rate2. Free flow of information

3. Corruption-free government

Amongst the top three since 2004

LOs*

1. Simple tax system and low tax rate2. Free flow of information

3. Corruption-free government

2010 SCoRPP. 15

FactorFavourable Unfavourab

le

Views on Favourable Factors for HK as a Location for Setting up RHQs/ROs

• Simple tax system and low tax rate• Free flow of information

• Corruption-free government• Absence of exchange controls

73%72%69%69%

1%

<0.5%<0.5%1%

• Communication, transport and other infrastructure

67%

1%

• Free port status 66%

1%• Geographical location 64

%1%

2010 SCoRPP. 16

FactorFavourable Unfavourab

le

Views on Unfavourable Factors for HKas a Location for Setting up RHQs/ROs

• Availability and cost of residential accommodation

• Availability and cost of business accommodation

13%

18%

36%

33%

2010 SCoRPP. 17

FactorFavourable Unfavourab

le

Views on Favourable Factors for HK as a Location for Setting up LOs

• Simple tax system and low tax rate• Free flow of information

• Corruption-free government• Absence of exchange controls

• Communication, transport and other infrastructure

72%70%68%67%

66%

1%

<0.5%1%

1%

1%

• Free port status 64%

1%

2010 SCoRPP. 18

FactorFavourable Unfavourab

le

Views on Unfavourable Factors for HKas a Location for Setting up LOs

• Availability and cost of residential accommodation

• Availability and cost of business accommodation

14%

18%

33%

32%

2010 SCoRPP. 19

Views on Overall Business Environment in HK

as a Location for Setting up RHQs/ROs and LOs

Deteriorated 12%

No comment 11%

Improved 13%

Same 64%

Deteriorated 13%

No comment 11%

Improved 13%

Same 64%

RHQs/ROs LOs

Comparing June 2010 with June 2009

Note: Percentages of components may not add up to 100 owing to rounding.

2010 SCoRPP. 20

Views on Effect of CEPA Implemented since January 2004 on RHQs/ROs and LOs

Very much beneficial

2%

Negatively affected

1%

To some extent

beneficial23%

Not affected

63% No comment

11%

RHQs/ROs LOsVery much beneficial

2%

Negatively affected

1%

To some extent

beneficial22%

Not affected

65% No comment

11%

Note: Percentages of components may not add up to 100 owing to rounding.

2010 SCoRPP. 21

Effect

Setting up new

business expansion

plans

Advancing business

expansion plans

No comment

11%

No79%

Yes10%

Views on Effect of CEPA on Investment Activities of RHQs/ROs and LOs

Whether investment activities affected ?

No comment

11%

Yes8%

No81%

RHQs/ROs LOs