#

Ease of Doing Business in

Hong Kong SAR, China

Hong Kong SAR, China Download Profile (1728.6KB, pdf)
Region East Asia & Pacific
Income Category High income
Population 7,305,700
GNI Per Capita (US$) 41,000
City covered Hong Kong

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 4 5 up
1
84.21 83.77 down
0.44
Starting a Business 3 4 up
1
98.20 98.12 up
0.08
Dealing with Construction Permits 5 5
-
84.82 84.78 up
0.04
Getting Electricity 3 5 up
2
99.02 94.74 up
4.28
Registering Property 61 60 down
1
69.79 69.78 up
0.01
Getting Credit 20 19 down
1
75.00 75.00
-
Protecting Minority Investors 3 3
-
80.00 80.00
-
Paying Taxes 3 3
-
98.69 98.69
-
Trading across Borders 42 42
-
88.94 88.94
-
Enforcing Contracts 21 21
-
72.57 72.57
-
Resolving Insolvency 28 27 down
1
75.06 75.06
-

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

DB 2017 Rank:

28

DB 2016 Rank:

27

Change in Rank:

down1

DB 2017 DTF (% points):

75.06

DB 2016 DTF (% points):

75.06

Change in DTF (% points):

0.00

Indicator Hong Kong SAR, China East Asia & Pacific OECD high income
Recovery rate (cents on the dollar) info_outline 87.2 33.9 73.0
Time (years) info_outline 0.8 2.6 1.7
Cost (% of estate) info_outline 5 20.6 9.1
Outcome (0 as piecemeal sale and 1 as going concern) info_outline 1 .. ..
Strength of insolvency framework index (0-16) info_outline 9 7.1 12.1
  • Indicator Explanation Answer
    Recovery rate (cents on the dollar) 87.2
    Proceeding As a secured creditor, by applying the Companies (Winding Up and Miscellaneous Provisions) Ordinance, BizBank would appoint a receiver to take charge of Mirage's business and try to sell the business as a going concern to recoup its investment. From BizBank's perspective, selling the business as a going concern would satisfy its secured debt in full according to the case assumption receivership
    Outcome Carrying business as a going concern will continue to generate cash flow to maintain the company operating as financially troubled company usually has very tight cash flow. Ceased business will cause immediate departure of employees, suppliers will walk away and petition for winding-up and attract complaints by customers which cause intervention from Government because of the public interest. going concern
    Time (in years) It may take an average 10 months from Mirage's default until BizBank is repaid some of the money owed to it after the completion of the receivership proceeding. After BizBank's appointment of the receiver, it takes about 1 month for the receiver to notify the Companies Registry of the appointment and for the Receiver to review the current financial status and immediate cash flow needs to maintain the hotel's on-going operations. In the meantime, usually 2-3 months are required for the accounting records of the hotel to be updated for preparation of the Statement of Affairs submitted by Mirage's management. This is crucial for the subsequent due diligence review by perspective buyers. 2 to 4 weeks more will be taken for the Receivers to report to creditors concerned and decide on the selling mode before the auctioneer will be appointed; and the organization, selection of buyer, negotiation, execution of the sale and sale proceeds payment would take another 6 months. 0.8
    Cost (% of estate) The costs associated with the case would amount to approximately 5% of the value of the debtor's estate. Cost incurred during the entire receivership proceeding mainly include court or government agency fees (0.5%), attorney fees (2%), costs of notification and publication (HKD 20,000), receiver fees (2%), fees of accountants, assessors, inspectors and other professionals (0.5%), and fees of service providers and/or government levies (0.1%). 5.0
    Answer Score
    Strength of insolvency framework index (0-16) 9.0
    Commencement of proceedings index (0-3) 3.0
    What procedures are available to a DEBTOR when commencing insolvency proceedings? (a) Debtor may file for both liquidation and reorganization 1.0
    Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (a) Yes, a creditor may file for both liquidation and reorganization 1.0
    What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a) Debtor is generally unable to pay its debts as they mature 1.0
    Management of debtor's assets index (0-6) 3.0
    Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? No 0.0
    Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0
    Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0
    Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0
    Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? No 0.0
    Does the insolvency framework assign priority to post-commencement credit? (c) No priority is assigned to post-commencement creditors 0.0
    Reorganization proceedings index (0-3) 1.0
    Which creditors vote on the proposed reorganization plan? (b) Only creditors whose rights are affected by the proposed plan 1.0
    Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? No 0.0
    Are the creditors devided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? No 0.0
    Creditor participation index (0-4) 2.0
    Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? Yes 1.0
    Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? No 0.0
    Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? No 0.0
    Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? Yes 1.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”.