Mr Chen, his wife and 8 year old son are from Shanghai.
Mr Chen is a manufacturer of specialist molded rubber components used exclusively in the mobile phone industry and wished to relocate himself to Hong Kong.
For several good reasons.
Hong Kong’s is a convenient local tax haven for rich Chinese nationals resident on the mainland (think Monaco to France, Jersey to the UK).
If a mainlander can secure residency in Hong Kong, as Chinese citizens, they can go on to secure PR and a HKSAR passport – a first class travel documents – after 7 years of continuous ordinary residence here.
By spending no more than 183 days each year in China and choosing to pay themselves in Hong Kong, mainlanders can escape the tax net in China yet still be close enough to their businesses in China for it not to have a major impact on their ability to generate wealth.
So, for Mr Chen and his family to relocate to Hong Kong they need to participate in the Capital Investment Entrant Scheme (“CIES”).
This immigration programme commenced in October 2003 with the objective of allowing well-heeled people to take up residence in Hong Kong without them needing to join in or establish an operating business.
The programme rules are reviewed regularly and at this time the funds required are HKD10 million with qualifying investments now excluding Hong Kong real property.
Mainlanders can participate in the Scheme directly from their homes in China so long as they can demonstrate to the Hong Kong Immigration Department that they have acquired permanent residency in a third country before applying under the CIES programme.
This third country can be anywhere – so Mr Chen chose The Gambia, a small West African country which offers a simple “PR for Cash” scheme with a cash payment and which took just 3 weeks to finalise.
There was no need for him nor his family to travel to Gambia – all that was required was the completion of a form, two photographs of each family member, copies of their passports and the requisite payment.
Once the Gambia PR was finalized Mr Chen’s application for a CIES visa was prepared.
This involved completing the application form ID967, furnishing a financial referee from Hong Kong CPA, setting out Mr Chen’s net worth, with the form indicating how he intended to invest at least HKD10 million into qualifying investments.
Certain documents were also provided as part of the application, including:
(1) Photographs of all family members affixed to the form.
(2) Copy passport details for Mr Chen and all included family members.
(3) Copy up-to-date CV for Mr Chen.
(4) Photocopy of Mr Chen’s graduation certificates/proof of academic qualifications.
(5) Copies of documents which showed Mr Chen’s prior employment and business record for the past 5 years.
(6) Report of Hong Kong CPA confirming Mr Chen’s net worth for the last 2 years showing that he had beneficially owned absolutely the HKD10 million he was investing into Hong King under the Capital Investment programme.
(7) A confirmation letter signed by Mr Chen confirming that he would be responsible for meeting his dependant’s financial needs in Hong Kong.
(8) Family photos evidencing Mr Chen and his dependants’ relationship.
(9) Copies of birth (for son) and marriage certificates (for his wife).
The application was submitted to the Hong Kong Immigration Department and a 6 month process commenced en route to approval.
During the application, the normal background checks which the HKID undertake did not reveal any security objection to Mr Chan and his family becoming resident in Hong Kong, and after 6.5 months they issued him with an Approval in Principle.
With this, Mr Chen and his family were granted three month visitor visas to allow them to relocate to Hong Kong to buy a home, find a school for their son and for Mr Chen to complete his investment of HKD10 million which he did with The Bank of China CIES Special Fund.
Once the documents proving the investment with the Bank of China had been been completed (it took 3 weeks), the Hong Kong Immigration Department granted the family a 2 year residence visa and they were issued their Hong Kong Identity Cards.
Every 2 years. Mr Chen and his family received an extension for a further 2 years as they were able to satisfy the portfolio maintenance requirements of the HKD10 million remaining invested in Hong Kong with the Bank of China and Mr Chen entered into a specific Undertaking in respect of continuing beneficial ownership of the HKD 10 million which, if breached, will have lead to loss of status when their most recent current period of stay expired.
As this situation prevailed for a minimum of 7 years and as the whole family were able to show that they had been continuously and ordinarily resident in Hong Kong throughout all this time (son was educated in Hong Kong, wife stayed at home in Hong Kong to care for their son and Mr Chen himself only visited the Mainland, didn’t full time live there) they went on to qualify for the Right of Abode and secured Hong Kong Permanent Residency (along with a HKSAR Passport)
Throughout this entire exercise, including service fees, Hong Kong Immigration Department fees and Gambia government fees the whole exercise cost Mr Chen less than HKD300,000 in professional immigration related service fee expenses.
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