Hong Kong Limited Partnership Funds (HKLPF) & Formation

• No separate legal personality. An LPF is a partnership, not a company. The GP has ultimate management/control and unlimited liability for fund debts; LPs enjoy limited liability (subject to “safe harbour” activities).

• Freedom of contract. The LPA governs economics and governance with broad flexibility familiar from Cayman/Delaware.

• No minimum capital and no statutory investment restrictions in the LPFO (subject to other applicable laws and the LPA).

• Naming & language. The English name must end with “Limited Partnership Fund” or “LPF”; the Chinese name must end with “有限合夥基金”.

• Registered office in Hong Kong for notices/communications.

• Confidentiality. The CR maintains an LPF Index and LPF Register, but the register of partners and key records (KYC/AML materials, audited FS) are kept by the fund and are not open to public inspection—available only to specified authorities.

• LP “safe harbour” list. Limited partners can do specified activities (e.g., serving on advisory boards, approving certain GP decisions) without being deemed to “manage” the fund.

• On-shore fund domicile that’s cost-effective vs. many offshore options (e.g., fixed CR fees).

• Unified Fund Profits Tax Exemption (UFE). Funds (incl. LPFs) can be exempt from Hong Kong profits tax on qualifying transactions in “specified assets,” subject to conditions. The IRD’s DIPN 61 sets out guidance.

• Carried interest concessions. Eligible carried interest paid by qualifying PE funds is taxed at 0% profits tax, and qualifying employees can get 100% salaries tax exclusion (effective from the year of assessment starting 1 Apr 2020), subject to conditions/certification.

• Re-domiciliation in. Since 1 Nov 2021, non-Hong Kong limited partnership funds can re-domicile as Hong Kong LPFs without creating a new legal entity or disturbing contracts/continuity.

• Stamp duty position (high level). Transfers of LPF interests generally are not “Hong Kong stock,” so are not chargeable to HK stamp duty; however, transfers of dutiable assets (e.g., HK shares/real property) by the fund remain within scope. Always obtain current tax advice.

• Must be a “fund” per LPFO and constituted by a limited partnership agreement.

• Partners. At least one General Partner (GP) (unlimited liability) and one Limited Partner (LP) (limited liability). Eligible GPs include a Hong Kong private company, a registered non-HK company, another limited partnership (HK or overseas), an LPF, or a natural person ≥18. LPs can be individuals or entities.

• Registered office in Hong Kong.

• Records & privacy. The GP or investment manager must keep audited financial statements, the register of partners, and AML/KYC records in Hong Kong; these are not public.

• Annual audit & return. The GP must appoint an independent Hong Kong practice unit as auditor and have annual audits. An Annual Return (Form LPF5) must be filed with fee (HK$105) within 42 days after each anniversary of registration.

• Proper custody. No mandatory third-party custodian under the LPFO, but the GP must ensure proper custody of assets; if a Type 9 licensee manages the fund, the SFC Fund Manager Code of Conduct custody standards apply.

• General Partner (GP). Ultimate management/control; unlimited liability. May also act as investment manager. If the GP is another LPF or a non-HK LP without legal personality, an Authorized Representative must be appointed and shares joint/several liability with the GP.

• Investment Manager (IM). Must be a HK resident ≥18, a company, or a registered non-HK company; can be the GP. If it carries on regulated activities in HK (e.g., discretionary securities management), it generally needs an SFC Type 9 licence (and possibly Type 1/4 if not merely incidental).

• Auditor. Must be a Hong Kong practice unit (per PAO Cap. 50), independent of the GP/IM; annual audits required.

• Responsible Person (AML/CFT). The GP must appoint a “Responsible Person” (can be the GP) who is an authorized institution, licensed corporation, accounting professional, or legal professional to perform AMLO Schedule 2 AML/CFT duties for the fund and its LPs.

• Authorized Representative (if applicable). Required only where the GP is an LPF or a non-HK LP without legal personality.

• Pre-set up

  • Select GP/LP structure and agree LPA terms; pick an eligible IM, Auditor, and Responsible Person; ensure a Hong Kong registered office and compliant LPF name.

• Application

  • File Form LPF1 (Application for Registration of LPF) through a Hong Kong law firm/solicitor acting for the proposed GP (statutory requirement).

  • Fees: HK$ 3,034 total at application (HK$2,555 registration + HK$479 lodgement). If the application is unsuccessful, the lodgement fee is non-refundable.

  • Simultaneous Business Registration: since 27 Dec 2023, you normally apply for Business Registration at the same time as LPF registration.

  • Processing time: the CR typically issues the Certificate of Registration and Business Registration Certificate within 4 working days after receipt. Electronic submission via the CR e-Services Portal is available.

• Post-registration (HK-domiciled LPF)

  • Keep required records in HK; appoint/confirm auditor; evaluate SFC licensing for the IM; set up proper custody; calendar LPF5 annual return filing (42 days post-anniversary).

• Conversions and re-domiciliation

  • Register a Cap. 37 LP as an LPF (Form LPF2).

  • Re-domicile a non-HK LP fund (Form LPF10). Effect: no new legal entity, contracts/rights preserved. You must deregister the fund in its place of establishment within 60 days of registration in Hong Kong (extensions possible).

• Strike-off risk

  • The Registrar may strike an LPF from the register if it ceases to meet eligibility (e.g., no IM, no Responsible Person, or no Authorized Representative where required) after due process.

• CityLinkers provide assistance in LPF setup.

• CityLinkers help to review the documents, agreements and the procedures of the fund for LPF setup.

• CityLinkers offer to coordinate applications with the authorities concerned.

• CityLinkers support the application for the required license during LPF setup.

• CityLinkers ensure LPF setup carefully complies with the related laws and ordinance.

With the success of LPF setup, CityLinkers would be willing to provide ongoing support to clients regarding LPF matters including administration and compliance, in a bid to ensure the fund is under efficient operation and to serve clients’ interests.

• CityLinkers help to deal with LPF administration.

• CityLinkers ensure the compliance of fund with related laws and regulations.

• CityLinkers provide the secretarial services regarding the fund.

• CityLinkers offer the assistance in accounting and financing of the fund.

• CityLinkers track and review the cash flow of the fund.