Dec. 17 – Companies incorporated in the British Virgin Islands (BVI) are now allowed to list in the Hong Kong Stock Exchange.

The HKSE has agreed to accept applications from companies incorporated in the British Virgin Islands.

Barry Mitchell, a partner at international law firm Maples and Calder heading the firm’s Hong Kong-based BVI team was quoted by Hong Kong Legal News as saying: “Private equity firms have incorporated companies in the BVI for the purpose of investing into China and many of them are now looking for an exit.”

He added: “Foreign private equity investment is reaching a certain level of maturity in China and with exits sometimes difficult to achieve, the ability to list in a well regulated and cost effective jurisdiction such as Hong Kong should provide BVI companies with an exit strategy which has not been hitherto available without first undertaking a significant restructuring.”

“Given that a listing on other exchanges can be less attractive in terms of costs and regulation,” Mitchell went on to say, “this is a welcome development and an option that will be very attractive.”

The British Virgin Islands is known for tourism and financial services. The territory is considered a tax haven with majority of government income coming from license fees for offshore companies.

For more information regarding doing business in Hong Kong, email hongkong@dezshira.com.