In order to encourage the listing of real estate investment trust (REIT) in Hong Kong, the HKSAR Government announced in the 2021/22 Budget that it would provide subsidies to qualifying REITs authorised by the Securities and Futures Commission (SFC) and listed in Hong Kong in the coming three years. The SFC has today (10 May 2021) announced details of the subsidy scheme.
The subsidy scheme covers both open-ended fund companies (OFCs) and REITs in Hong Kong. For OFCs successfully incorporated in or re-domiciled to Hong Kong and SFC-authorised REITs successfully listed on the Stock Exchange of Hong Kong Limited, the scheme covers 70% of eligible expenses paid to Hong Kong-based service providers, subject to a cap of HK$1 million per OFC and HK$8 million per REIT. Qualifying REITs should have a market capitalisation of at least HK$1.5 billion (or its equivalent) at the time of listing.
Examples of eligible expenses covered by the scheme include fees charged by law firms or legal advisers for legal work in relation to the incorporation/re-domiciliation of an OFC/REIT, including (i) the drafting of legal documents and offering documents of the OFC/REIT and (ii) work done in relation to the authorisation of an OFC/REIT with the SFC.
Interested parties may obtain further details about the eligibility criteria and application process from the frequently asked questions published by the SFC.