Establish a Hong Kong Limited Partnership Fund (LPF)

Since its introduction in August 2020, Hong Kong has witnessed the establishment of hundreds of LPFs, recognised as an attractive vehicle for Greater China-based and global asset managers. If you're thinking about setting up an LPF, speak to our local experts to find out how.

Hong Kong is one of the world’s leading financial centres. Its location provides a key link to both Western and Eastern markets, as well as mainland China.  The key features that have been driving its popularity are:

Strategic Location

Proximity to mainland China and its central role in the Greater Bay Area (GBA) enhances its market access.

Currency Flexibility

Hold and manage funds in multiple currencies with ease.

IPO Leadership

A global leader in IPOs, offering a popular exit strategy for private funds

Investor-Friendly Tax System

Benefit from a straightforward tax regime with no capital gains, withholding, or dividend taxes for foreign investors.

What is the Hong Kong LPF?

A Limited Partnership Fund (LPF) is a fund structured in the form of a limited partnership to encourage funds to domicile in Hong Kong by offering a simpler and straightforward regulatory framework.

Freedom to conclude the LPA in respect of the operation of the LPF, along with a lack of restrictions on investment scope and the additional tax efficiencies, make the LPF an attractive structure for different investment strategies. It can be used as feeder fund, master fund or co-investment fund.

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Key features of an LPF

Eligibility requirements

An LPF must have a general partner, at least one limited partner, an investment manager, a responsible person, an independent auditor, and a registered office.

Investment restrictions

There are no investment restrictions.

Legal personality

The LPF does not have separate legal personality. It is acting through the GP.

Freedom of contract

The LPF is governed by a limited partnership agreement (LPA), which defines a wide range of operations that the LPF is authorised to undertake.

Registration and post-establishment changes

The HKLPF can be easily set up within a few business days, subject to a complete form filed with the Hong Kong Companies Registry (CR) on behalf of the proposed general partner by a Hong Kong law firm or a solicitor.

The CR must be notified of certain changes pertaining to the LPF, such as, a change of name, a change of the place where the LPF’s records are kept, a change of investment manager or a change of authorised representative.

Benefits of the LPF

Vistra can help you launch your LPF and provide end-to-end fund administration, setup, tax compliance, governance, and regulatory support.

Tax incentives

Profits tax exemption is provided, so long as they meet certain conditions under the Unified Regime Ordinance.
Eligible carried interest received by or accrued to qualifying carried interest recipients will be exempt from Hong Kong profits tax (on or after 1 April 2020).
No capital duty on capital contributions, no stamp duty on contributions, transfers, or profit distribution.

Flexible structure

Customisable Limited Partnership Agreement.
Freedom to determine capital contributions, profit distributions, and other contractual terms.
As well as the option to re-domicile non-Hong Kong funds as LPFs.

Accommodating diverse strategies

Can be used for private equity, venture capital, buy-out, real estate, infrastructure and project funds.
Can also be used for special situation, distressed asset, credit and hybrid funds.

Video

Maximise the Advantages of the LPF

Watch our 1-min video to understand the benefits and trends of LPF and OFC fund structure in Hong Kong, and how Vistra supports fund managers and funds entering the Greater China market.

In-depth LPF knowledge and experience

Starting in 2020, we were one of the original fund administrators in Hong Kong to help setup and service clients’ LPF structures.

Technology-driven solutions

We invest in world-class technology and develop our own proprietary tech on cloud-based platforms to help simplify your fund administration and enhance data security.

Fixed-fee model

Our pricing is transparent and competitive, so you can expect no surprises.

Comprehensive solution

Our end-to-end fund services cover the entire investment structure and fund lifecycle, including fund administration, SPV administration, portfolio/operating company support, transaction support mergers and acquisitions, carve-outs, etc.

Interactive map

Interactive fund domiciles map

What other fund structures can you consider outside of Hong Kong?

Our interactive fund domiciles map allows you to compare popular destination countries by type of structures available and their respective set-up time, regulatory and tax requirements.

Explore the map