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FAQ > Setting Business in Hong Kong > A03

Q: What are the advantages of Hong Kong economic system? View : 121

International, transparent and efficient

Hong Kong is one of the world's most business-friendly cities. Free market policies, the rule of law and Hong Kong's business development's free flow of information mean a level playing field for all companies.

Hong Kong, Asia's most popular city for international business, is a city that works. Its enduring appeal is built on political stability, the rule of law, free market principles, free flow of information, and English as the language of business.

All businesses in Hong Kong benefit from:

• One of the world's most open, and corruption-free economies
• Independent judiciary and the rule of law
• Free flow of information

The Globalization Index 2012, released by Ernst & Young in cooperation with the Economist Intelligence Unit (EIU), shows that Hong Kong has the highest level of globalization of the world's 60 largest economies for the third consecutive year.

One country, two systems

Since 1997, Hong Kong has been under Chinese sovereignty but it has a separate political and legal system, based on principles that are best summed up by its ‘One Country, Two Systems' concept. This has helped it to retain all the fundamental strengths that underpin its success as an international business city, while enhancing its appeal with unrivalled access to opportunities in Mainland China.

• Level playing field for all – no foreign ownership restrictions
• Clean government and rule of law upheld by an independent judiciary
• Free movement of capital, talent, goods and information
• Fully convertible Hong Kong dollar separate from the Renminbi (RMB)
• Autonomous executive and legislative powers
• Independent participation in international forums including the World Trade Organization
• English and Chinese as official languages, with English the usual language of business and contracts

Among the world's most corruption-free cities

Hong Kong is one of the least corrupt economies in the world, according to theTransparency International's Corruption Perceptions Index 2013. It ranks ahead of countries including Japan, the US and France. Cronyism, influence-peddling and bribery receive zero tolerance. This is due to Hong Kong's strong public administration, which ensures that companies are free to pursue their business concerns on a level playing field.

Hong Kong's Independent Commission Against Corruption (ICAC) provides free advice to companies on how to prevent corruption. Established in 1974, its success has been such that countries around the world, including Australia, have used it as the model for their own corruption-fighting agencies.

Independent legal system

With its commitment to the rule of law, Hong Kong is a popular place to structure contracts and settle disputes. Its legal system is based on the British Common Law system and it has a fully independent judiciary. The city also offers extensive mediation and arbitration services, which offer rulings that are enforceable in a number of jurisdictions.
Hong Kong's free market policies

For the past 20 years Hong Kong has been ranked as the ‘World's Freest Economy' by the Heritage Foundation/Wall Street Journal. The index measures economies in 10 areas, including trade, business,Hong Kong investment and property rights. Hong Kong scored particularly well on business, trade and financial freedoms and government support for intellectual property rights.
The free market and free trade is the life-blood of Hong Kong. As a result, it is one of the most open, externally-oriented economies in the world.

Hong Kong embraces globalization of trade and services and is an active participant in international organizations that promote such activities.

• The cornerstone of its economy rests on free enterprise, free trade and free markets open to all
• There are no barriers to trade – no tariffs, no quotas, no exceptions
• No restrictions on investments inward or outward
• No foreign exchange controls
• No nationality restrictions on corporate or sectoral ownership

Free flow of information

Freedom of information is another core advantage that Hong Kong offers businesses. From getting a driving license to checking your Facebook account, reading the daily news or researching potential business partners, Hong Kong is committed to transparent, timely and reliable information.

• Constitutionally-guaranteed free press and freedom of speech
• Information about government services easily available online
• Unrestricted access to the internet

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