Publication | Managing Risk in Hong Kong Capital Investment Immigration

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  1. In March 2024, Hong Kong officially launched the new Capital Investment Entrant Scheme (the CIES), an enhanced iteration of the programme previously in force from 2003 to 2015. The most notable revision is the increase in the minimum investment threshold from HK$10 million to HK$30 million, underscoring the Government’s intention to position the scheme as a refined and high-end gateway for global high-net-worth investors.


(Source: Official Website of InvestHK)

  1. Since its launch, the new CIES has garnered robust international interest. As at 28 February 2026, the Hong Kong Government has received 3,200 applications, representing an estimated HK$95 billion in prospective investment inflows and further consolidating Hong Kong’s status as a premier international wealth management hub.
  1. As enthusiasm continues to build, it is important for the public to also understand the practical risks in capital investment immigration and the strategic approach around them to safeguard one’s legitimate interests. To this end, we thought we would use one of the original CIES matters which we recently concluded for a case study.

Factual Background

  1. In a previous publication “Publication | Permanent Residency by Investment Programme, or Scams?”, we identified two broad categories of suspected scams warranting heightened vigilance in the context of the CIES: share investment scams and bond investment scams. The present matter concerns the latter.
  1. The client applied for Hong Kong permanent residency under the original CIES. In 2014, through an investment intermediary, the client subscribed HK$10 million in 10-year bonds issued by a Hong Kong-listed company (the Listco). Pursuant to the bond instrument, the Listco undertook to redeem the bonds upon maturity together with accrued interest.

  1. From 2022 onwards, market rumours began circulating that Listco’s bonds had fallen into default. Alerted, the client made several enquiries regarding the status of his bonds but was unanswered by the Listco — indications of an impending default became increasingly apparent. The client thus instructed us to pursue recovery and we in turn swiftly managed to obtain a summary judgment for the client against the Listco within six months.

Listco’s Relentless Evasion of Payment Liability

  1. Subsequently, the Listco lodged two successive appeals up to the Court of Appeal, both of which were strenuously contested by us. The appeals were consequently dismissed.
  1. In parallel, in separate compulsory winding-up proceedings initiated by other creditors, the Listco furnished repayment undertakings to the Court in an attempt to stave off immediate liquidation. Yet once repayment timelines were fixed, the Listco repeatedly sought extensions and advanced various excuses, including appeals against the Court’s directions and allegations of setbacks in financing arrangements.
  1. Ultimately, upon the expiry of the ultimatum and in the absence of repayment, the Court refused to put up with any further delay and thus ordered the Listco to be wound up. The Listco’s evasive manoeuvring, however, did not cease there.
The first creditors’ meeting must be convened within three months from the date of the winding‑up order for, among other things, the appointment of liquidator(s). Only creditors whose Proofs of Debt have been admitted by the Official Receiver’s Office (the ORO) for voting purposes are entitled to attend and vote at the meeting. At this stage, in practice, the ORO will not inquire into the veracity of the underlying debts.


(Source: News.gov.com)

  1. At the first creditors’ meeting, from our active participation in various relevant court hearings by way of representation or watching brief, we spotted that the purported “creditor” who had on the eve of the meeting nominated its preferred candidates as liquidators (the Private Liquidators) is closely connected to the Listco. Anyhow, by virtue of the purported creditor’s majority in the face-value of indebtedness, he secured the passing of that nomination.

Going the Extra Mile — Strategic Response

  1. At the meeting, we raised concerns regarding the last‑minute nomination and ensured that those concerns were duly recorded in the minutes. We subsequently conducted further due diligence on the proposed Private Liquidators and noted judicial criticism against them in two prior court cases concerning issues of partiality and dereliction of duties.
  1. The independence and impartiality of liquidators are of cardinal importance in the liquidation process. The above findings gave rise to legitimate concerns as to the suitability of the Private Liquidators to take office.
Ideally, a creditor wishing to challenge the appointment of any liquidator should make a formal application to the Court with supporting evidence.
  1. However, for an individual investor such as our client, such an application would entail substantial additional legal costs and impose a significant financial burden.
Procedurally, the ORO is required to submit a report to the Court regarding the appointment of the Private Liquidators and to advise whether such appointment ought to be confirmed.
  1. In light of the above, we decided to go the extra mile in assisting the client on a complimentary basis:
  1. (1) We wrote to the ORO setting out in detail the client’s concerns, citing the relevant statutory provisions and urging the ORO to discharge its duties rigorously by scrutinising the background of the Private Liquidators and consequently to disapprove of their appointment in its report to the Court.
  2. (2) Simultaneously, we copied the correspondence to other creditors of the Listco with a view to galvanising collective power and prompting them to voice similar concerns to the ORO in pursuit of procedural fairness.
  1. Within two months, more than ten creditors echoed. In addition to expressing support to our initiative, some of them further furnished extra evidence showing connections between the purported creditor and the Listco. Against this mounting concern, the ORO referred the matter of the Private Liquidators’ appointment to the Court for determination with a detailed account of the objections raised by our client and other creditors.
  1. Looking ahead, if the creditors continue to act in unity and formally apply to the Court to oppose the appointment of the Private Liquidators, there remains a real prospect of overcoming the procedural hurdles and securing a more favourable outcome for creditors as a whole. This is likely the final mile to go.

Takeaway for Client

  1. As demonstrated above, effective lawyering requires not merely procedural compliance but strategic foresight, persistence, and a willingness to go beyond the path of least resistance to secure meaningful protection of the client’s interests.
  1. Amidst the strong market response to the new CIES, the present case serves as a timely reminder that capital investment immigration is not without risk. Prospective investors should exercise prudent judgment before committing to any investment. Careful project selection, rigorous due diligence on service providers, and a clear understanding of enforcement and insolvency exposure remain essential safeguards against unforeseen pitfalls.