TL;DR:
Hong Kong’s Limited Partnership Fund (LPF) regime gives private funds a modern, tax-efficient home under local law. It’s flexible enough for private equity, venture capital, credit, and real-asset strategies — and increasingly used by family offices and even tokenisation structures. With unified profits-tax exemption and 0% carried-interest treatment, the LPF is now one of Asia’s most competitive fund vehicles.

What Is a Limited Partnership Fund?

Introduced in 2020 under the Limited Partnership Fund Ordinance (Cap. 637), the LPF lets investment funds register in Hong Kong as limited partnerships.
Each LPF must have:

At least one General Partner (GP) – manages the fund and bears unlimited liability.
At least one Limited Partner (LP) – contributes capital but enjoys limited liability.
A Hong Kong registered office.
A local responsible person for AML/CFT compliance.
An auditor to prepare annual financial statements.

Unlike a corporation, an LPF is not a separate legal person. It’s a contractual structure built around the Limited Partnership Agreement (LPA) between partners — giving flexibility over capital commitments, profit distribution, and governance.

Why Managers Choose the LPF

Regulatory simplicity – Registration with the Companies Registry only; no SFC pre-approval unless the manager performs regulated activities in Hong Kong.
Commercial flexibility – Freely tailor LPA terms for drawdowns, management fees, carried interest, and governance.
Global investor familiarity – Mirrors limited-partnership models in Cayman, Delaware, and Singapore.
Tax efficiency – Unified fund exemption + 0% eligible carried interest.
Cross-border appeal – Supported by Hong Kong’s network of tax treaties and professional ecosystem.

Who Can Set Up an LPF

To register an LPF, you’ll need:

Role	Requirement
General Partner (GP)	Individual, Hong Kong company, non-HK company registered in HK, or another LPF GP entity.
Limited Partners (LPs)	Individuals or entities contributing capital; no day-to-day control.
Responsible Person	Must be an authorised institution, licensed corporation, or accounting/legal professional for AML/CFT compliance.
Auditor	Must audit annual accounts.
Hong Kong law firm / solicitor	Can assist in filing the registration documents with the Companies Registry.

(Tip: TITUS routinely acts as the filing law firm and compliance adviser for new LPF registrations.)

Registration Process

Prepare the Limited Partnership Agreement (LPA).
Appoint the required parties (GP, LPs, auditor, responsible person).
Engage a Hong Kong solicitor or law firm to submit the application.
File with the Companies Registry and pay the fee:
- HK $2,555 registration + business-registration fee/levy.
- HK $479 lodgement fee (non-refundable).
Receive the Certificate of Registration of LPF and Business Registration Certificate.

The process typically takes a few working days once documents are complete.

Tax Benefits of the LPF

1. Unified Profits-Tax Exemption (since 2019)

Privately offered funds managed by qualified investment managers in Hong Kong are exempt from profits tax on specified transactions, regardless of onshore/offshore domicile.

2. 0% Carried-Interest Rate (effective 2020)

Eligible carried interest received by fund managers and employees from qualifying LPFs is subject to 0% profits tax. This makes Hong Kong’s regime directly competitive with Singapore’s VCC incentive and Luxembourg’s PE frameworks.

3. No VAT, no capital-gains, no withholding tax

Hong Kong remains one of the most fund-friendly tax jurisdictions globally.

Common Use Cases

Private Equity & Venture Capital Funds – classic closed-end structures.
Credit and Real-Asset Funds – infrastructure, renewables, property.
Family-Office Co-Investment Vehicles – discreet, flexible, low-cost.
Tokenisation / Virtual-Asset Funds – increasingly feasible under Hong Kong’s VA policy roadmap (subject to SFC licensing).

Compliance & Governance

AML/CFT: the Responsible Person must maintain procedures under AMLO (Cap 615).
Audited accounts: annual financial statements filed to partners.
No public offering: LPFs are private, professional-investor vehicles.
Changes in particulars: GPs must notify the Companies Registry promptly.

LPF vs OFC: How Do They Compare?

Feature	LPF	OFC
Legal form	Partnership (Cap 637)	Corporate (SFO Part IVA)
Approval	Companies Registry only	SFC + CR (one-stop)
Manager	Optional – Type 9 licence needed only if managing securities/futures in HK	Mandatory Type 9 manager
Custodian	Optional	Mandatory
Strategy fit	PE, VC, credit, real assets	Liquid/public funds
Liquidity	Closed-end	Open-end (subscriptions/redemptions)
Tax	Unified exemption + 0% carried interest	Same
Investors	Professional only	Private or public

(Coming soon: “OFC in Hong Kong: What You Need to Know” and “LPF vs OFC: Which Structure Fits Your Fund Strategy?”)

FAQs

Q1. Do I need an SFC Type 9 licence to manage an LPF?
Only if the GP or manager conducts regulated activities in Hong Kong (e.g., asset management of securities/futures). Many offshore managers appoint an SFC-licensed entity to comply.

Q2. How long does registration take?
Usually 5–7 business days once documents are in order and filed by a local solicitor.

Q3. Can I redomicile a Cayman fund into an LPF?
Yes. Hong Kong allows qualifying offshore funds to re-register as LPFs under a streamlined process.

Q4. Are there minimum capital requirements?
No statutory minimum — partners agree capital commitments under the LPA.

Q5. Can an LPF invest in virtual assets?
Yes, if managed by an appropriately licensed manager and compliant with the SFC’s Virtual Asset Guidelines.

Final Thoughts

The LPF has transformed Hong Kong’s private-fund landscape — combining international familiarity with local tax advantages.
For fund managers, family offices, and sponsors considering a Hong Kong base, the LPF is now a clear contender to the Cayman LP.

Need help setting up your LPF?
Talk to TITUS — we act as filing counsel, compliance adviser, and structuring partner for LPF, OFC, and hybrid vehicles.

Tel: +852 3702 0045
WhatsApp: +852 9720 3003
Email: info@titus.com.hk
Suite 4002, 40/F, Lippo Centre Tower 1, 89 Queensway, Admiralty, Hong Kong

The Limited Partnership Fund (LPF) in Hong Kong: A Complete Guide