Hong Kong is set to extend its subsidies for open-ended fund companies (OFCs) and real estate investment trusts (REITs) for another three years on the back of positive market response.
The Hong Kong government introduced the three-year grant scheme in May 2021 to encourage international investment firms to set up OFCs and REITs in the city.
The government announced in the 2024-2025 budget last February to extend the scheme for three years starting from April 11, 2025 due to industry demand.
The Securities and Futures Commission (SFC) says there has been an “overwhelming industry support and take-up of grants under the scheme”.
As of end-February, the number of registered OFCs in Hong Kong recorded a year-on-year increase of 81% to 502. A total of 430 OFCs and one REIT have benefited from the scheme, the financial regulator says in a statement on March 31.
Under the scheme, OFCs incorporated in or redomiciled to Hong Kong and SFC-authorised REITs newly listed on the Hong Kong exchange are eligible to apply for subsidies that cover 70% of expenses paid to local service providers.
The scheme is subject to a cap of HK$300,000 (US$38,560) for a public OFC, HK$150,000 for a private OFC, and HK$5 million for a REIT.
“With continued support from the government and market participants, the grant scheme will continue to play an important role in sustaining the momentum and interest in setting up new OFCs and REITs in Hong Kong,” Christina Choi, executive director of investment products at SFC, says in the statement.
