Report on Hong Kong LPF Registration, Acquisition and Transfer

Hello everyone. Today, rather than starting with a “licence application”, we will first clarify the legal status of a Hong Kong LPF. [Pause] An LPF is a fund vehicle and registration regime registered with the Companies Registry under the Limited Partnership Fund Ordinance, Cap. 637. It is not an SFC licence issued by Hong Kong’s Securities and Futures Commission, and obtaining an LPF certificate of registration does not automatically confer a Type 9 asset management licence, eligibility for public offering or tax exemption. This presentation covers four categories of decisions: establishing a new LPF, acquiring or transferring LPF interests, acquiring shares in a company that holds the GP, or replacing the GP at the LPF level. We will address registration, roles and responsibilities, regulation, taxation and closing separately, to avoid conflating different issues under “buying a fund licence”. This presentation is based on official materials verified as at 2026-10-21, for client discussions and fact-finding interviews, and is not a substitute for professional advice.

For an LPF project, the first question is not ‘which route is fastest’, but what outcome the client wants. For a new registration, the advantage is the absence of historical baggage: the GP, LP, IM and RP arrangements can be built afresh around a new investment strategy, investor arrangements and LPA. However, documents, authorisations, banking, service providers and compliance records must also be established from scratch. For an acquisition or transfer, the subject matter may differ entirely: it may be LP interests under the LPA, shares in a company holding the GP entity, or the withdrawal, removal or replacement of the GP at LPF level. It may also involve taking over assets, contracts, bank authorities and unsettled transactions. [Re-read] None of these constitutes an acquisition of an SFC licence, nor does completion of the transaction automatically replace all registered roles. We therefore recommend first establishing six facts: the strategy, investors, location of the investment manager’s decision-making, assets, existing contracts and historical liabilities. Only once these answers are clear should the costs and risks of a new establishment, an interest transaction and a GP-level transaction be compared.

The four core LPF roles must be considered separately. The GP is responsible for managing and controlling the fund and bears ultimate responsibility, while ensuring proper custody arrangements for fund assets. The GP is not merely an administrative role lending a corporate name. The LP contributes capital under the LPA and enjoys distribution, information and exit rights under the documents. In principle, the LP has limited liability, but actual participation in fund management may affect that protection during the period of participation; the safe harbour activities listed in Schedule 2 must also be checked individually. The IM is the investment manager responsible for day-to-day investment management. The law permits delegation of functions where an engagement is involved, but outsourcing does not automatically eliminate responsibility. If the IM or delegate conducts regulated activities such as asset management in Hong Kong, the need for Type 9 or other licences must be assessed under the SFO and SFC rules. The RP is the responsible person for implementing the AML/CTF measures in Schedule 2 to Cap. 615. The RP may be an authorized institution, licensed corporation, accounting professional or legal professional. In particular, the RP and the authorized representative AR appointed under certain non-Hong Kong GP structures are not the same role; their appointments, responsibilities and handovers must not be conflated.

Establishing a new LPF can proceed through seven stages. First, confirm the strategy, assets, offering method and Hong Kong activities. Second, confirm the name, Hong Kong registered office, GP and at least one LP. Third, finalise the LPA, investment management agreement, RP or AR, asset custody and signing authorities. Fourth, select LPF1, LPF2 or LPF10 based on the facts. LPF1 is generally used for new registrations, LPF2 for qualifying specified funds and LPF10 for qualifying non-Hong Kong funds. Fifth, LPF1 and LPF10 are submitted to the Companies Registry by a Hong Kong law firm or solicitor on behalf of the proposed GP; for LPF2, check the submission rules under the specified fund route and submit IRBR4 and the business registration fee concurrently under the applicable one-stop arrangements. Sixth, where the information and fees meet the requirements, CR issues the Certificate of Registration of Limited Partnership Fund and the applicable Business Registration Certificate. Seventh, include annual returns, event-driven changes, tax, AML and record-keeping in a single calendar. Fees and processing times must be stated accurately. The currently listed total application fee for LPF1, LPF2 and LPF10 is HK$3,034, comprising a registration fee of 2,555 and a non-refundable document submission fee of 479. Issuance normally on the fourth working day is the official description of normal processing, not a guarantee for every case. Incomplete information, incorrect fees or facts requiring further verification will affect the actual timeframe.

Clients most often confuse CR fees, business registration fees and annual return fees. The first category is CR applications: LPF1, LPF2 or LPF10 costs a total of HK$3,034, including a non-refundable document submission fee of HK$479. The second category is business registration. Under the reference fee table for 1 April 2026 to 31 March 2027, the first one-year certificate costs a total of HK$2,350 and the three-year certificate a total of HK$6,170. The final amount depends on the application date and the official fees then in force. The third category is ongoing filings. LPF5 is the annual return, with the normal fee currently listed as HK$105, and must be submitted within 42 days after each anniversary of the certificate of registration. LPF6 is not an annual return; it is a notice of a court order restraining the use of the fund name and must not be described as an annual filing. The limited partnership agreement does not need to be submitted to the Companies Registry, but that does not make it unimportant. The LPA is the core document governing contributions, capital calls, distributions, transfers, exits, and GP powers and liabilities. For a new establishment, the LPA and registration documents should be designed together; for an acquisition, it should be among the first documents reviewed in due diligence, rather than left until after completion.

Clients should firmly remember the “three transaction layers” on this page. The first is a transfer of LP interests: what is purchased is a partnership interest under the LPA. Review transfer restrictions, consent rights, unfunded commitments, CDD and UBO, sanctions, tax, the register and transferee eligibility. A transfer of LP interests does not automatically replace the GP, IM or RP, or automatically release pre-transfer liabilities. The second is an equity transaction involving the GP entity: what is purchased is shares in the GP company. This requires corporate-level analysis of changes of control, directors and bank signing authority, assumption of contracts and stamp duty. However, acquiring shares in the GP company does not mean that the statutory GP in the LPF registration has changed. Only the third layer concerns the withdrawal, removal or replacement of the GP at LPF level. It affects fund management and control, contractual authority, bank signing, service provider relationships, investor consent and CR event notifications. The three layers may occur together, or only one may occur; a single “transfer form” cannot capture all outcomes. Historical liabilities do not automatically disappear because of a name change or share sale.

If a client is considering an acquisition, we recommend due diligence across six modules. The first is legal matters and the LPA, examining transfers, changes of control, GP replacement, indemnities, exit and disputes. The second is regulation and licensing, checking Hong Kong activities, Type 9, offering methods, custody and selling restrictions. The third is AML and UBO, checking RP, CDD, sanctions, monitoring and information gaps. The fourth is finance and tax, including financial statements, capital calls, distributions, UFE, carry, FSIE, AEOI and stamp duty. The fifth is contracts and assets, listing banking, brokerage, custody, administration, financing, unsettled transactions and underlying assets. The sixth is operations and litigation, checking record locations, personnel authorisations, audits, filings, claims and historical liabilities. These six modules are not an endless information checklist, but answer three questions: what the buyer acquires; which liabilities must be assumed; and which conditions must be met before completion. Missing key documents should be treated as conditions precedent to completion, price adjustment items or express reservations, rather than replacing evidence with a statement that 'there have been no historical issues'.

A closing project requires more than a sale and purchase agreement. The first checklist covers agreements, including the LPA, subscription and transfer documents, GP and IM agreements, administration, custody, brokerage, side letters, financing, indemnities and releases. The second covers conditions, including investor, GP and service-provider consents, completion of CDD and UBO checks, and smooth handover of banking, trading, assets, data and the authority matrix. The third is the closing checklist, itemising cash, positions, collateral, outstanding orders, valuations, capital calls, distributions, disputes and records. The fourth is the notification checklist. For LPF4A matters such as address, record-keeping location and investment scope, the CR FAQ generally specifies 15 days after the change; changes to particulars or replacements of the GP, AR, IM and RP must be checked against LPF4B, LPF4C and the form instructions, and must not be deferred until LPF5. When a non-Hong Kong fund registers using LPF10, the original partnership continues to exist; no new legal entity is created, and existing contracts, property, obligations and litigation are not automatically severed. The official deadline for deregistration in the original place of establishment following registration is 60 days, but advisers in the original jurisdiction must confirm whether this can be completed.

LPFs and OFCs follow different registration routes. An LPF is a limited partnership fund without separate legal personality, registered by the Companies Registry under Cap. 637, with governance centred on the GP, LPA and partners' rights. Capital calls, distributions and transfers of partnership interests are generally easier to express through partnership documents. An OFC is a corporate fund with limited liability and variable share capital, registered by the SFC. The OFC structure requires at least two natural person directors, at least one independent director, a Type 9 investment manager and a custodian. If a client needs corporate governance, share classes, subscriptions and redemptions, and an express custody structure, an OFC may be more direct; if the client's focus is closed-ended commitments, capital calls and exit distributions, an LPF is often more closely aligned with the commercial arrangements. However, promotional labels must not be treated as legal conclusions. OFCs are not restricted to investing in open-ended liquid assets; official materials also list private equity and closed-ended fund uses. Nor are LPFs legally restricted to private equity. Neither automatically receives tax exemption through registration; the ultimate assessment must still consider activities, assets, investors and tax facts.

We recommend addressing tax in three layers. The first is UFE, the Unified Fund Exemption. First verify the fund definition, qualifying transactions under Schedule 16C, and the specified person route or qualifying investment fund route, then examine the current 5% incidental transaction threshold, the SPE and private company tests, and the anti-avoidance rules for resident investors. LPF registration is not, in itself, a certificate of automatic tax exemption.

The second is carried interest. Under the current regime, conditions concerning certification, qualifying private equity funds, profit linkage, the payment chain and substantial activities must still be verified for the applicable period. Please note in particular: as at 2026-10-21, the 2026 tax amendments we have verified remain legislative proposals, with commencement unconfirmed. It cannot be stated that exemption is automatic or that certification, hurdle or 5% conditions have already been removed. Any transaction plan relying on the reforms must first recheck passage, gazettal, commencement dates and IRD guidance.

The third is stamp duty. The government's LPF brochure lists specific advantages for cash contributions, cash distributions, and contributions, transfers or withdrawals of partnership interests. However, in-kind contributions or distributions of Hong Kong stocks or immovable property, and transfers of shares in a Hong Kong company acting as GP, require separate analysis. Certificates of tax residence, FSIE and AEOI are not substitutes for evidence of eligibility for UFE.

Next, we need clients to provide a set of facts first, rather than complete a generic “standard form”. These include the fund strategy and assets, target investors and offering method, investment management and decision-making locations, proposed name, and GP, LP, IM, RP and AR details; also the LPA, subscription documents, side letters, CR and business registration certificate, and banking, custody, brokerage and administration agreements. For an acquisition or transfer, financial statements, capital calls and distributions, tax filings, AML/UBO files, litigation and claims, asset lists, outstanding transactions and an authority matrix are also required. The information is used to confirm the subject of the transaction, liability boundaries and closing conditions. We can deliver in stages: a facts and pathway memorandum; formation, acquisition and transfer roadmaps; a roles and authority matrix; a due diligence question list and risk grading; documents, forms, fees and an event calendar; and closing and handover checklists. Legal, tax and licensing conclusions remain subject to confirmation by the relevant professionals based on the facts.

Finally, condense the actions into three steps. First, arrange a fact-finding interview to address the strategy, investors, management location, assets, and whether an LPF or GP already exists. Second, based on the facts, choose establishment of a new LPF, transfer of LP interests, an equity transaction involving the GP company, replacement of the GP at LPF level, or redomiciliation using LPF10. Third, before formal submission or closing, check fees, forms, licensing, tax and notification deadlines against the then-current original official texts of CR, SFC and IRD. We will not describe an LPF as a tradable licence or promise automatic tax exemption based on tax amendments not yet in force. This presentation does not constitute legal, tax, investment or licensing advice, nor does it guarantee registration, account opening, licensing or closing outcomes. [Pause] Thank you all. Prepared by Rengangyongsheng (Hong Kong) Limited, with professional explanations provided by Drew Tang, Business Manager. We have two offices in Hong Kong and a liaison point in Shenzhen; please make an appointment before visiting. To continue the discussion, visit lpf-hk.com, contact us via WhatsApp at https://wa.me/85292984213, or email Drew@sfc8.com. Thank you.