1. 2008 SCoRP P. 1 2008 Annual Survey of Companies in Hong Kong Representing Parent Companies Located outside Hong Kong

2. 2008 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. 2008 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. 2008 SCoRP P. 4 Survey Coverage RHQs + ROs + LOs ≠ Total no. of companies in HK with investment from outside Hong Kong

5. 2008 SCoRP P. 5 Survey Targets   Parent companies located outside HK Companies in HK representing parent companies located outside HK > ( > 6612 )( 6612)

6. 2008 SCoRP P. 6  First working day in June Survey Reference Date  2 June 2008

7. 2008 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. 2008 SCoRP P. 8 Country/Territory of Location of Parent Companies No. of companies Note : Top 4 countries/territories listed in terms of total no. of RHQs, ROs and LOs.

9. 2008 SCoRP P. 9 Geographical Responsibility of RHQs and ROs in the Region (other than HK) No. of companies Note : Top 5 countries/territories listed in terms of total no. of RHQs and ROs having responsibility for the operation /business there.

10. 2008 SCoRP P. 10 No. of companies Major Line of Business of RHQs, ROs and LOs Note : Top 5 lines of business listed in terms of total no. of RHQs, ROs and LOs engaged in the lines of business concerned.

11. 2008 SCoRP P. 11 Major Line of Business of Parent Companies No. of companies Note : Top 5 lines of business listed in terms of total no. of RHQs, ROs and LOs with parent company engaged in the lines of business concerned. No. of companies

12. 2008 SCoRP P. 12 Views on Importance of Factors for Choosing 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. Absence of exchange controls 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

13. 2008 SCoRP P. 13 Views on Importance of Factors for Choosing 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

14. 2008 SCoRP P. 14 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 Absence of exchange controls Corruption free government 71% 69% 68% 67% < 0.5 % 1% Political stability and security65%1% Communication, transport and other infrastructure 65%1% Free port status 65%1%

15. 2008 SCoRP P. 15 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% 18% 34% 32%

16. 2008 SCoRP P. 16 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 Communication, transport and other infrastructure 68% 64% 63% 61% 1%

17. 2008 SCoRP P. 17 Factor FavourableUnfavourable Views on Unfavourable Factors for HK as a Location for Setting up LOs Availability and cost of residential accommodation Availability and cost of business accommodation 13% 17% 33% 31%

18. 2008 SCoRP P. 18 Views on Overall Business Environment in HK as a Location for Setting up RHQs/ROs and LOs Deteriorated 15% No comment 12% Improved 15% Same 58% Deteriorated 15% No comment 14% Improved 14% Same 57% RHQs/ROsLOs Comparing June 2008 with June 2007

19. 2008 SCoRP P. 19 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 26% Not affected 58% No comment 12% RHQs/ROsLOs Very much beneficial 2% Negatively affected 1% To some extent beneficial 24% Not affected 59% No comment 14%

20. 2008 SCoRP P. 20 Effect No comment 12% No 78% Yes 10% Setting up new business expansion plans Advancing business expansion plans Views on Effect of CEPA on Investment Activities of RHQs/ROs and LOs Whether investment activities affected ? No comment 15% Yes 8% No 78% RHQs/ROsLOs

21. 2008 SCoRP P. 21 2008 Annual Survey of Companies in Hong Kong Representing Parent Companies Located outside Hong Kong