Hong Kong regulators are considering extending a tax exemption on performance-based fees to proprietary trading firms such as Jane Street and Citadel Securities, after the measure helped boost the city’s appeal as a hub for hedge funds, the Financial Times reported, citing two sources close to the process. The exemption was originally planned only for private equity firms and hedge funds. Hong Kong officials may opt to issue additional guidance to confirm the eligibility of trading firms, rather than amending the draft legislation currently under review by Hong Kong’s Legislative Council. The move comes amid a revival in the IPO market and a more business-friendly regulatory environment, which have prompted a number of hedge funds and financial firms to start relocating staff to Hong Kong.
Tax exemption extension to trading firms would benefit Citadel Securities' operations in Hong Kong.
Tax exemption extension to trading firms would benefit Jane Street's operations in Hong Kong.
