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Advance ruling case no. 73 provides guidance for determining the beneficial ownership of a FIHV held through a foundation
Recently published advance ruling case no. 73 concerned various issues including whether the entities owned by a family foundation are a family investment holding vehicle (FIHV) or a family-owned special purpose entity (FSPE); and whether the transfer of certain Schedule 16C assets on an arm’s length basis to the FIHV/FSPE would be caught by the general anti-avoidance rules where any assessable profits of the transferors arising from the transfers will be chargeable to profits tax in Hong Kong.
The rulings on the above issues do not appear to involve any difficult interpretation of the relevant legislative provisions and are therefore not discussed in this alert. Clients who are interested to understand the basis of these rulings can refer to the case published on the website of the Inland Revenue Department.