HK extends grant scheme to boost OFCs and REITs

The extended scheme will start accepting applications from 10 May.

The Government of Hong Kong and the Securities and Futures Commission (SFC) has announced the extension of the Grant Scheme for Open-ended Fund Companies (OFCs) and Real Estate Investment Trusts (REITs).

The extended scheme, administered by the SFC, will start accepting applications from 10 May.

Launched in 2021,  the grant scheme provides funding support for OFCs established in or moving to Hong Kong and REITs listed in the city, covering eligible expenses incurred by Hong Kong-based professional service providers.

Under the expanded scheme, eligible OFCs and REITs will receive funding support covering 70% of eligible expenses paid to Hong Kong-based service providers, with caps set at $1m for publicly offered OFCs, $500,000 for privately offered OFCs, and $8m for REITs.

The budget has extended the scheme for three years until 2027, demonstrating the government's commitment to enhancing Hong Kong's position as a premier fund hub.

Since its inception, the scheme has led to significant growth in the number of OFCs registered in Hong Kong, from 14 in May 2021 to 302 by March 2024.

Additionally, the budget announcement included the waiver of stamp duty on REIT unit transfers, and the recent inclusion of REITs under Stock Connect further supports the growth of Hong Kong's REIT market.