1. 2009 SCoRP P. 1 2009 Annual Survey of Companies in Hong Kong Representing Parent Companies Located outside Hong Kong 政 府 統 計 處政 府 統 計 處 Census and Statistics Department

2. 2009 SCoRP P. 2 (i)To enumerate number of RHQs, ROs and LOs in HK representing parent companies located outside HK (ii)To obtain basic information of these companies (iii)To seek their views on HK as a location for setting up RHQs/ROs and LOs Survey Objectives

3. 2009 SCoRP P. 3  Covers companies in HK taking charge of business/operations in HK or in the region on behalf of parent companies located outside HK  Does not cover companies in HK which are funded by investment from outside HK and manage the business in HK or in the region independently but not on behalf of investors Survey Coverage

4. 2009 SCoRP P. 4 Survey Coverage RHQs + ROs + LOs ≠ Total no. of companies in HK with investment from outside Hong Kong

5. 2009 SCoRP P. 5 Survey Targets   Parent companies located outside HK Companies in HK representing parent companies located outside HK > ( > 6397)( 6397)

6. 2009 SCoRP P. 6  First working day in June Survey Reference Date  1 June 2009

7. 2009 SCoRP P. 7 How is a company classified as an RHQ, RO or LO? Taking charge of business/operations on behalf of its parent company located outside HK? Non-RHQ/RO/LO No Yes Geographical responsibility ? LO HK only RHQ Yes In the region Any managerial control over offices in the region? RO (i.e. only coordinates offices and/ or operations in the region) No

8. 2009 SCoRP P. 8 No. of RHQs, ROs and LOs in HK Representing Parent Companies Located Outside HK No. of Companies

9. 2009 SCoRP P. 9 Country/Territory of Location of Parent Companies No. of companies Note :Top 4 countries/territories shown in terms of total no. of RHQs, ROs and LOs.

10. 2009 SCoRP P. 10 Geographical Responsibility of RHQs and ROs in the Region (other than HK) No. of companies Note :Top 5 countries/territories shown in terms of total no. of RHQs and ROs having responsibility for the business/operations there.

11. 2009 SCoRP P. 11 Major Line of Business of RHQs, ROs and LOs Note :Top 5 major lines of business shown in terms of total no. of RHQs, ROs and LOs engaged in the lines of business concerned. No. of companies

12. 2009 SCoRP P. 12 Major Line of Business of Parent Companies No. of companies Note : Top 5 major lines of business shown in terms of total no. of RHQs, ROs and LOs with parent company engaged in the lines of business concerned. No. of companies

13. 2009 SCoRP P. 13 Views on Importance of Factors for Choosing a Location for Setting up RHQs/ROs and LOs *In descending order of importance RHQs/ROs * 1.Simple tax system and low tax rate 2.Free flow of information 3.Corruption free government 4.Political stability and security 5.Rule of law and independent judiciary LOs * 1.Simple tax system and low tax rate 2.Free flow of information 3.Corruption free government 4.Political stability and security 5.Absence of exchange controls

14. 2009 SCoRP P. 14 Views on Importance of Factors for Choosing a Location for Setting up RHQs/ROs and LOs *In descending order of importance RHQs/ROs * 1.Simple tax system and low tax rate 2.Free flow of information 3.Corruption free government Amongst the top three since 2004 LOs * 1. Simple tax system and low tax rate 2.Free flow of information 3.Corruption free government

15. 2009 SCoRP P. 15 Factor FavourableUnfavourable Views on Favourable Factors for HK as a Location for Setting up RHQs/ROs Simple tax system and low tax rate Free flow of information Corruption free government Absence of exchange controls 74% 72% 70% 1%1% <0.5% 1% Communication, transport and other infrastructure 68%1% Political stability and security 67%1% Rule of law and independent judiciary 67%1% Free port status 67%1%

16. 2009 SCoRP P. 16 Factor FavourableUnfavourable Views on Unfavourable Factors for HK as a Location for Setting up RHQs/ROs Availability and cost of residential accommodation Availability and cost of business accommodation 14% 19% 35% 33%

17. 2009 SCoRP P. 17 Factor FavourableUnfavourable Views on Favourable Factors for HK as a Location for Setting up LOs Simple tax system and low tax rate Free flow of information Corruption free government Absence of exchange controls Rule of law and independent judiciary 72% 70% 68% 65% <0.5% 1% Political stability and security64%1% Communication, transport and other infrastructure 64%2%

18. 2009 SCoRP P. 18 Factor FavourableUnfavourable Views on Unfavourable Factors for HK as a Location for Setting up LOs Availability and cost of business accommodation Availability and cost of residential accommodation 18% 14% 33%

19. 2009 SCoRP P. 19 Views on Overall Business Environment in HK as a Location for Setting up RHQs/ROs and LOs Deteriorated 34% No comment 11% Improved 6% Same 49% Deteriorated 31% No comment 12% Improved 7% Same 50% RHQs/ROsLOs Comparing June 2009 with June 2008

20. 2009 SCoRP P. 20 Views on Effect of CEPA Implemented since January 2004 on RHQs/ROs and LOs Very much beneficial 2% Negatively affected 1% To some extent beneficial 25% Not affected 61% No comment 11% RHQs/ROsLOs Very much beneficial 3% Negatively affected 1% To some extent beneficial 23% Not affected 61% No comment 12%

21. 2009 SCoRP P. 21 Effect Setting up new business expansion plans Advancing business expansion plans No comment 11% No 77% Yes 11% Views on Effect of CEPA on Investment Activities of RHQs/ROs and LOs Whether investment activities affected ? No comment 12% Yes 8% No 80% RHQs/ROsLOs

22. Questions & Answers