May 1 2021

Hong Kong Unveils New Ship Leasing Incentive

Source: Invest HK

Along a maritime journey of more than 150 years, Hong Kong has established itself as a premier international maritime centre that enjoys competitive advantage in high value-added maritime services. We have a strong cluster of nearly 900 maritime-related companies. The HKSAR government has  introduced a new concessionary tax measures for qualifying ship lessors (QSL) and qualifying ship leasing managers (QSM) to further enhance the city’s position as a global financial and maritime hub.

The new tax regime applies to revenue earned on or after 1 April 2020:

Tax Concession for QSL

  • 0 percent
  • Capital gain exemption on ship disposal after leasing the ship for a continuous period of three years

Tax Concession for QSM

  • 0 percent for associated companies and 8.25 percent for non-associated companies

Reliable Financing Options 

Backed by a sophisticated financial market, the city is set to tap the fast growing shipping market in Mainland China. With enhanced integration between Hong Kong and other Guangdong-Hong Kong-Macao Greater Bay (GBA) cities, Hong Kong port is likely to gain a new lease of life as being part of the major Southern China port cluster.  Under the GBA plan, it pledged to consolidate and enhance Hong Kong’s status as an international maritime centre and support Hong Kong’s development of high-end maritime services such as ship management and leasing, ship finance and dispute resolution services.

To further strengthen the port cluster’s global competitiveness, China’s Ministry of Transport signed an agreement with the maritime authorities of Hong Kong and Macao to establish a collaborative mechanism to promote water transportation safety and green shipping development in the GBA.

In addition, Hong Kong is a leading international ship finance centre in Asia. Shipping loans and advances in Hong Kong have grown significantly by 9.8 percent per annum over the past decade, amounting to around HK$126 billion as of September 2020. In view of the business opportunities, seven of the world’s top 10 bookrunners on syndicated marine finance loans have set up offices in Hong Kong.  More than 70 of the world’s top 100 banks operate in the city, including those with prominent ship finance business.

Source: Invest HK