Can You Remain In Hong Kong Under An Employment Visa Sponsored By An Ex-Employer & Run A Hong Kong Sole Proprietorship Providing Services Outside Of Hong Kong (Mostly)?

Posted by The Visa Geeza / in Employment Visas, Investment Visas, Your Question Answered / No responses

Remain in Hong Kong under an Employment Visa sponsored by an ex-Employer? Unusual set of facts in this case and a question never posed to me in this fashion previously…

QUESTION

I have been in Hong Kong since 2011 under an employment visa but have recently quit my job.

The last time my visa was renewed it was extended until November 2018 and I understand I still have the privilege to reside in Hong Kong until then even if my employment has ended.

I now have a consultancy agreement with a firm based in Singapore for which I provide services independently.

The fieldwork (which represents 80% of the work) takes place outside of Hong Kong, I only write up my reports from home in Hong Kong.

I have registered a sole proprietorship business to report the consultancy income for tax purposes.

However, I guess I am not supposed to work under the current conditions of my stay.

My questions are:

(1) Could the fact of reporting that income to the tax authorities actually trigger some issues on the immigration side?

(2) If I was to apply for a business investment visa as an entrepreneur and it was rejected, could that trigger the Immigration Department to cancel my current permission of stay until November 2018?

What is in your opinion the best thing to do?

ANSWER

The employment visa that you have presently has been granted to you on the strength that you are permitted to work in Hong Kong for your nominated employer and your nominated employer alone. As you’ve correctly understood, even though you have a valid limit of stay that stretches all the way through to 2018, you’re privileged to work for anybody in Hong Kong other than yourself.

Given that you have established a business – which you’ve done through the establishment of your sole proprietorship, essentially you’ve breached your conditions of stay at that point, and given that you’re spending 80% of your time on field work outside of Hong Kong, engaging in employment activities outside of Hong Kong doesn’t mitigate the fact that you will spend the 20% of the remainder of your time in Hong Kong actually undertaking employment activities for your own sole proprietorship business.

So, clearly, in the circumstances that you find yourself right now, you are breaching your conditions of stay as a result of you not merely residing in Hong Kong but having established a business here. So, clearly you’ve got to think about bringing your circumstances into compliance as soon as you possibly can.

Additionally, the fact that you have established a sole proprietorship certainly could alert the Immigration Department to the fact of you having established that business, as the Immigration Department and Inland Revenue Department are able to exchange information if they so wish;  whether that’s an automatic exchange of information or whether it’s done on specific query or not is question that remains open being part of the Security Bureau; clearly I don’t have privileged access to how those government departments work but, nevertheless, my best advice to you is to make an application to adjust your status from sponsored employment through to business investment in your own right. I won’t go into the details of how you go about satisfying the approvability test for that business investment visa, because I’ve dealt with that quite extensively elsewhere on the site.

In terms of the Immigration Department potentially refusing any such business investment visa application as an entrepreneur and then yanking, as it were, the rug from under your feet and then giving you a shorter limit of stay, I suspect that that’s probably not going to happen to you; it doesn’t appear to be the Immigration Department standard practice in those circumstances. If they say no to business investment, it means that they are not satisfied that you can make a substantial contribution to the economy of Hong Kong on the basis of your business plan and the other information that you have put forward. So, if you do get denied, you do have an opportunity to have another go at it on the basis of a reconsideration, and if you get it right the second time, then you are on your way.

So, just to wrap it all up – yes, you are not permitted to actually engage in the activities that you’ve presently configured yourself for, given that you’ve left your employment of your previous sponsor.

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Must The Employing Company Sponsor Of My Hong Kong Work Visa Application Be Profitable?

Posted by The Visa Geeza / in Employment Visas, Your Question Answered / No responses

How important is sponsor-profitability, especially for start up businesses less than 12 months old?

QUESTION

I have been recruited by a newly established company (12 months old as of this week).

They have never hired a foreigner and have tasked me with completing the visa forms, both employee and employer versions.

The Employer-side application requires “proof of financial standing.”

Although registered one year ago, the company has only recently begun making sales, which do not amount to much.

Will the companies lack of profit negatively affect my chances at being approved under this Hong Kong work visa application?

If so, is there anything that can be done to mitigate this?

Thank you in advance for your reply.

ANSWER

Whenever the Immigration Department are asked to ascribe a suitable and credible sponsorship status to a newly established enterprise, the Immigration Department will look at a number of different factors when taking into account a good financial standing of the business. As a newly established company with no history of trading, that will not come as a surprise to the Immigration Department if only just turning revenue now, that’s okay.

They’ll look to see for a set of management accounts – I appreciate you won’t have an audited management account at this point, but certainly up-to-date management accounts that shows the balance sheet and the profit and loss so that the Immigration Department can see what’s going on now, that will be beneficial to the application.

The fact that there are no revenues, as you say, then what does the bank balance look like, and what the extent of the funding available to be used for the business. As long as all of that stacks up, it will not stand in the way of you getting your approval because you’ll satisfy the financial bona fides accordingly.

I hope you found that useful.

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Can The Company You Have Just Left Contact Hong Kong Immigration And Make Your Visa Expire Immediately?

Posted by The Visa Geeza / in Employment Visas, Special Programmes, Your Question Answered / 14 responses

Contact Hong Kong Immigration and make your visa expire? This question comes up often enough for it to warrant another explanation of the arrangements which prevail (current ImmD practice)…

QUESTION

Dear Visa Geeza,

 I’m under the impression that when you leave a company that has been sponsoring your employment visa or if you are fired, that as long as your visa hasn’t expired you are allowed to stay in Hong Kong and look for new employment.

Can the company you have just left contact immigration and make your visa expire immediately so you therefore lose the right to stay in Hong Kong and look for work? 

ANSWER

This scenario is very much an old chestnut; so, I’d like to take this opportunity to hopefully sort of bury it once and for all time. Effectively, when you secure an employment visa sponsored by a Hong Kong employer, you get two privileges: (1) you get the privilege to do the work – that’s nominated in the employment contract for the sponsor of record, and (2) you also get the privilege to reside – that flows naturally from the privilege to work.

When you stop working for your current employer, your privilege to work ceases, but your privilege to reside continues until your current limit of stay expires, or the Immigration Department remove it from you, whichever is the sooner it is; in fact, the Immigration departments standard practise to allow the current limit of stay to expire where there has been a situation such as yours, and therefore you will be allowed to remain in Hong Kong to carry on your lives until your current limit of stay expires, whereupon you’re expected to leave.

Additionally, it is considered a ‘permitted activity’ under your continuing privilege to reside to look for and indeed interview for work. However, it is not ‘permitted activity’ to take up that employment. Therefore, prior to joining in a new company (sponsor) in Hong Kong, you will have to make an application to change your sponsorship so that the Immigration department can apply the approvability test in the context of the new job offer that you’ve got in hand and will then, once applying that approvability test, determine whether you should be able to take up that employment and in the process re-invoking your privileges to work for that new employer. So that’s how all of that works.

In terms of an ex-employer contacting the Immigration Department and ask that your privilege to reside in Hong Kong be suddenly be immediately revoked, the Immigration Department tend not to get involved in issues associated with reasons as to why an employment might have come to an end.

In other words, an employer does have an obligation to inform the Immigration Department of material change in circumstances as regards their sponsorship charges – and so normally an employer will write to the Immigration Department to advise them of the official date of employment termination (and the Immigration Department just hold that on file and the termination date of your prior employment becomes a matter of your record), but the employer cannot sort of overreaching themselves and saying that you should not be allowed to remain in Hong Kong for reasons such as  you having not have done your job well or any of this kind. The Immigration Department won’t take on board any of that, as they just look at the circumstances dispassionately and will just reflect the fact of your cessation of employment with that sponsor, rather than taking any steps towards, in a sense, punishing you for what might have passed during your prior employment, and not making it possible for you to make an honest application to change your sponsorship and continue your lives in Hong Kong on the basis that you’ll be able to get that change of sponsorship application approved.

In a nutshell, the answer to your question is: an employer can’t effectively kick you out of Hong Kong just because they happen to be your employment visa sponsor of record.

I hope you find this useful.

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How Can I Bring My Chinese Girlfriend To Hong Kong To Live With Me While I Work Here?

Posted by The Visa Geeza / in Family Visas, Feature Article, Your Question Answered / No responses

Having a relationship with a Chinese partner resident on the Mainland can be problematic if you wish to share your lives together in Hong Kong…

QUESTION

I am looking to take up employment in Hong Kong from November 1st.

My biggest concern is the ability and feasibility for my girlfriend from Mainland China to be able to join me in Hong Kong.

Please can you advise on possible options.

She only graduated just over a year ago, so a Mainland Talent visa, I assume, is definitely out.

Thanks for your time, much appreciated.

ANSWER

As you have identified already the mission of Mainland Talents and Professionals Scheme which provides an opportunity for mainland graduates who are deemed to be talents or professionals to come to Hong Kong to take up employment on the strength of having received a job offer here from a suitable employer.

This visa programme is not going to be suitable for you in your circumstances because of the fact that your partner is a new graduate. So because of the floodgate mechanism that works in Hong Kong, in a sense to keep down the numbers of mainland residents taking up residence here, realistically, having looked through the options available to you, I would suggest that your best possible chance of being able to carry on your joint lives in Hong Kong is for her to get a student visa, potentially go ahead and participate in a master’s degree programme from a Hong Kong university – and it must be a graduate degree in this respect, or she could take an undergraduate programme as well if she wanted to take another bachelor’s degree on board. However, my advice would be to apply to do a master’s degree and thus get a student visa that would then allow you one year together until she graduates. And then at the end of that one year upon graduation, she could apply for a visa under the immigration arrangements for non-local graduates, which effectively gives her a carte blanche visa to go and work for anybody, no questions asked, for another year, and at the end of that year, as long as she’s got and employment with a suitable and credible sponsor, and the compensation that she’s receiving for the work that she does is broadly commensurate with market rates, then she’ll be able to carry on getting extended in Hong Kong under those arrangements on an indefinite basis through to seven years, as long as she’s in full time employment each time that she makes an application to extend her visa.

So, really cutting to the chase, if you want to carry on your lives in Hong Kong, really the only option you’ve got is a student visa, then immigration arrangements for non-local graduates. I hope you found this useful.

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If I Have A Hong Kong Dependant Visa Can I Work Here For A Foreign Company Even Though They Have Not Registered As A Business In Hong Kong?

Posted by The Visa Geeza / in Family Visas, Your Question Answered / No responses

This question mainly relates to business rather than immigration law but is still an important question nonetheless…

QUESTION

Hello

I have a Hong Kong  dependant visa that gives me the right to work in Hong Kong. I have been offered a Regional Asia role based out of Hong Kong by a Canadian company.

This company is not registered in Hong Kong.

Can I work for them as sole proprietor under my Hong Kong dependant visa ? Or do they need to register as a limited company?

If they register here can I work for them on my Hong Kong dependant visa?

Appreciate your help.

ANSWER

Strictly speaking, from an immigration perspective, there is no preclusion to you taking up employment with any party in Hong Kong, because the legal dependent visa effectively gives you carte blanche approval to engage in any kind of activity in Hong Kong so long as it’s lawful and as long as you continue to remain under the sponsorship of your spouse – the principal employment visa holder.

The issue really here is the question of how you go about ensuring that you personally and the activity that you engage in is lawful from the perspective of your income, because you do need to be reporting the results of your work activity to the Inland Revenue Department.

And normally, if you’re an out and out employee, your employer is registered as a business here, and the act of registering as a business allows the Inland Revenue Department to be put on notice that you should be sent a tax assessment for the work that you do working for that registered business in Hong Kong, and given that your proposed employer doesn’t have a registered business in Hong Kong, the question is begged as to how you will be able to ensure that your income is reported to the Inland Revenue Department so that you are compliant with revenue law. And as you’ve alluded to in your question, registering as a sole proprietorship is the way forward, simply because there is no other way for the Inland Revenue department to understand, essentially how you’ve been earning your living, and by registering as a sole proprietor, getting a business registration certificate, the money that you receive from that overseas entity will be recorded in your hands as income, and after due allowances have been made for expenses as a registered sole proprietor, then you’ll have at the end of the exercise an accessible income to tax and you’ll pay a tax on that.

But insofar as the registration requirements of the proposed employer in this regard, as long as they are not going to be carrying on a business here and the work that you do will be as an independent contractor representing the interests of that foreign business, then there is no preclusion or issue at all in terms of how you will be working for them so long as you yourself is registered as a sole proprietor, and you report your income to the Inland Revenue Department in that fashion. I hope you found that useful.

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I Have A Socially Advantageous Yet Modestly Capitalised Business Plan – Can I Get An Investment Visa For Hong Kong?

Posted by The Visa Geeza / in Investment Visas, Your Question Answered / 12 responses

This is an important question on the business investment visa for Hong Kong….

Experience suggests that the Hong Kong Immigration Department do tend to look favourably upon such business plans, but the applicant absolutely does not have it all his or her own way, as you will learn in my PodCast answer. (Please note the subject matter of the business in this question is just an ersatz surrogate. I have changed it to ‘fear of flying’ to protect the identity of the service nature and maintain the confidences of the person planning to establish this very unique enterprise.)

QUESTION

“I, an American citizen, have been planning on beginning a stress-management therapy business in Hong Kong for adults who suffer from a fear of flying.

The market is a whole lot bigger than you might imagine given that intrinsically Hong Kong is a small, far flung place that is typically accessed by commercial flights.

Consequently there is hardly anything in Hong Kong and the rest of Asia generally which offers this type of private therapy course, plus post-therapy support, for adults who simply can’t  summon up the courage to get into an airplane.

Each intensive therapy course will run over a 3 day period, 12 hours per day. The objectives of the therapy are not just to allow participants to control and overcome their fears, but become incredibly self-confident in the process.

I personally have 8 years of first-hand experience in this very successful therapy. I have been through the same programme as a student, now a graduate, coach and course instructor.

I don’t hold any tertiary qualifications except for a Diploma at college.

My girlfriend, who is also a coach and course instructor on the programme, holds a bachelors degree.

The start-up costs are very low. I envision I can start employing 1 person full-time after 7 months and 2 people in part-time employment after 10 months.

The business is basically a franchise in many respects. The programme is already a worldwide business (the America’s, UK, Australia, South Africa, Europe, NZ, etc) so this will be the Asian branch.

In that case, is there a possibility the owner/inventor of the programme could help fund the start-up in HK or would that relegate myself to an ’employee’ status in the eyes of the HK officials rather than a ‘Business Owner’?

With only US$6,000 in capital available to me at the moment, I believe my best route is to try to register the business over in mainland China first.

I have not looked into the hurdles one must pass to start a business over here (I’m in Guangzhou) but it may be easier than HK.

If I can do it, I have the prospect of having around US$25,000-US$40,000 come April-June next year.

With that money available, and the proof of income making already from the business in mainland China, that may be a better time to apply for the Investment Visa in HK?

I expect business to be operating full throttle after 14-18 months from start up in Hong Kong bringing in around US$40,000 a month from then on.

I also plan to keep studying Mandarin and Cantonese language classes so I can eventually teach the courses in native Chinese language which will increase my market.

Do I have a good chance of obtaining an Investment Visa?”

ANSWER

The fact of the matter is that the Immigration Department do place significance on the nature of an enterprise that’s going to be supporting an application for an investment visa by a foreign national, and if the space that the foreign national is going to be establishing a business in can be said to be advantageous to society more generally than just the contribution that it makes to the economy of Hong Kong, experience tells me that the Immigration Department do factor that in quite heavily.

That having been said, there is still a requirement for the enterprise itself to be credible on every front. So sort of dealing with the general themes that you raise in your question in no particular order, but will all tie properly together at the end.

I believe I’ll start off by saying that the USD6,000 that you’ve got to invest in the business will not work for the Immigration Department. I mean, quite apart from the fact that the visa calls for an active investment, USD6,000 really isn’t sufficient capital to actually get the business off the ground, and the Immigration Department do know that typically any business that is going to be relying upon revenues to be earned to finance itself tend to be a stew by the department.

So you’re going to have to have a decent wedge of capital under your belt to persuade the department that you’ve got the necessary resources to give effect to your plan because, as we know, just because you’ve got a really good business idea doesn’t mean that it’s going to be successful by mere fact that it is an idea and it’s a good idea, you’re going to have to invest money into taking it to market and bringing it to the attention of people who are going to be providing you with the revenues to ensure that it’s successful. So USD6,000 isn’t going to cut the mustard, I’m afraid.  On the other hand, if the franchisor took an equity stake and provided a bulk of the capital, that would significantly improve your chances of success. But as a business with you owning a piece of the action, the Immigration Department would apply the investment visa aprovability test to your application, rather than the employment visa provability test, and they are two different animals: one focuses on the individual skills of the applicant – that’s the employment visa probability test, whereas the investment visa aprovability test focuses squarely on what the business is all about and how it can make a substantial contribution to the economy of Hong Kong. But in a strange way, if your franchisor came in and effectively took the bulk of the equity this could be advantageous, because unless you’ve got specific qualifications in the fear of flying space, as it were, I suspect the Immigration Department would conclude that you’re not actually qualified to undertake this work as an employee. Therefore, by going down the investment visa route, it puts the focus on the chances of success as a business, not how qualified you are as an employee; and once you get to a point where you’re really sort of ten to 15% shareholder in a company, the Immigration Department, they’re going to be applying investment visa approvability test here in any event. So that definitely could be a way for you to fast track your plans to come into Hong Kong if you’re prepared to go into business with these people.

In terms of the turnover at USD40,000 a month, I mean, this is a half a million dollars a year and that will definitely pass muster with the Immigration Department. So your revenue numbers are absolutely on the money for an approval in terms of you potentially being able to take your limited capital pool to China first and starting your business there before you bring it to Hong Kong.

Like you, I’m not really in a position to understand what will pass muster in China, whether or not you can get immigration status in the way that you envisage. But I can tell you that if you use China as a proving ground and establish this practise there first, it will definitely be a good idea, because what that will mean is the Immigration Department will be able to access the documentation that shows that it has worked.

In fact, it is working under your stewardship in China and it becomes de risked from the Immigration Department’s perspective, particularly if you’re going to wait until another eight or nine months down the road when you do anticipate that you’re going to come into funds of up to say, USD40,000. That level of financing together with a track record in China, together with your experience in this space, together with the creation of local jobs in the first twelve months, together with a projected half a million USD in revenues turnover in the first twelve months, I believe the Immigration Department would give you an investment visa on that kind of story with those kind of resources in place. So, from that perspective, I think, you’re onto a pretty good opportunity if it all falls into play in the way that you’re hoping it to.

Now, the only other question that you’ve raised that I need to address relates to this question of your girlfriend and who is ostensibly qualified to perform this work.

I think implied in that inclusion in the question is the idea that you’re going to have your girlfriend come and work in the business for you, which, on the basis that she doesn’t have immigration status for Hong Kong, will mean that this business is going to have to serve as an employment visa sponsor for her, which, as a new business, is going to raise a lot of questions with the department having said that if you can fold her into the story in such a way to suggest that the business is going to grow with her contribution, together with your contribution, to the extent that the two of you on the books, as it were, your ability to sell more is going to be increased, and that will then, by extension, allow you to create a bigger business, and the creation of local employment opportunities is going to be improved over and above the numbers that you’ve mentioned in your question. So don’t take it for granted that just because the Immigration Department partner buying into the idea that you will get an investment visa, but it’s assuming that your girlfriend, under the sponsorship of this new vehicle, will be able to get approved accordingly. That’s a separate challenge that will need to be examined in light of where you are in your business at the time that you make your application. It is not impossible, but you certainly need to think about that as a separate application exercise; don’t factor it into your own application mix, as it were.

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Can A Newly Qualified Foreign National Permanent Resident Of Hong Kong Automatically Secure PR For His Parents Too?

Posted by The Visa Geeza / in Long Stay & PR, Your Question Answered / No responses

So, just what immigration options for parents accrue to a foreign national holding a Hong Kong permanent identity card?

QUESTION

Hi there!

 A foreign national became a permanent resident after many years study and work in Hong Kong.

Now he wants to sponsor his parents holding Canadian passports to become a P.R.

In Hong Kong too – any way to do that? 

How long will it take for the application? 

Thank you.

ANSWER

In Hong Kong there is no facility to automatically secure permanent residency for foreign nationals other than the process of undergoing seven years of continuous ordinary residency in Hong Kong. So notwithstanding the fact that there is a situation where an individual – foreign national, has recently secured permanent residency that in of itself is not going to parlay or translate into opportunities for permanent residency for any other family member automatically, other than for dependent children under the age of 21 who were born in Hong Kong whilst such a person was a temporary resident here.

In any event, in order to secure status to allow dependent parents to be residents in Hong Kong sponsored by a foreign national permanent resident, the only manoeuvre that’s available is to apply for dependent visas for the elderly parents, and elderly in that regard is over 60 years of age.

The application is relatively straightforward, but you need to show that there is dependency on the part of the parents, and that the sponsor can put food on their table and a roof over their head.

Once those dependent visas have been independently secured, those elderly parents will maintain their residency under dependent visa status throughout all of the seven years that follow the issue of the dependent visa in the first place, and at the end of that seven-year period they will be able to independently apply for permanent residency in their own right.

So, to answer your question, no ability for permanent resident foreign nationals to automatically undergo process to get permanent residency for any other supporting family members or accompanying family members, but there does exist a mechanism for elderly parents in this type of scenario to become permanent residents after seven years of holding dependent visas. I hope you found that useful.

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