Starting a Travel Agency in Hong Kong

Hong Kong is a favorite travel destination in the Asia Pacific region and the world. Its geographical position and closeness to Mainland China, have made the city boom in popularity with Chinese tour groups for years and therefore the travel industry has exponential growth too.

In this article, we will go through the requirements needed to obtain a travel agency license, the application process, as well as other considerations. More details will be explained in the next sections.

What is a Travel Agent Business?

Let's start by going through the local regulation for travel agencies in Hong Kong. There has been a recent change in the legislation, the Travel Agents Ordinance has been substituted by a new ordinance called the Travel Industry Ordinance, which also established the Travel Industry Authority, and it became effective in September 2022. Previously, the Travel Industry Council of Hong Kong (TIC) was in charge of this task.

In the new ordinance, it is established that the Travel Industry Authority (TIA) will be in charge of the process of granting the travel agency license to the applicants that met the conditions. The ordinance makes the distinction in engaging in travel agent business in the following activities:

• Getting another person's carriage, on a journey that started in Hong Kong in any kind of transport or vehicle and will take place outside of Hong Kong most of the time.
• Getting another person's accommodation outside of Hong Kong.
• Getting a visitor to Hong Kong carriage, accommodation, or any touristic services in Hong Kong, as well as transportation.

On the other hand, there is a distinction for the Mainland inbound tour group activities. The following activities are considered in this category:

• Providing tour services to local places, arranging meals, shopping trips, and local transportation services in Hong Kong.

Any person who wishes to provide any of the above-mentioned services as a business needs to apply for and obtain a travel agent license in Hong Kong. Now that we have gone through the basics of the regulations we can move into the requirements to obtain the license.

What Are The Requirements?

There are some requirements needed before applying for a Hong Kong travel agent license. Here we will enlist some aspects to consider.

• To operate as a travel agent you don't have to be an incorporated company in Hong Kong, for example being a sole proprietorship, which functions as an individual. It is possible to operate both as an incorporated or unincorporated entity in Hong Kong. The important aspect is to be registered in Hong Kong and apply for the corresponding license.
• As a new stipulation, the Travel Industry Authority requires to nominate someone as an Authorised Representative. This person will be a representative for the applicant for the license and will have some duties. For incorporated businesses, the directors, general managers, or even the company secretary can be nominated for this role as long as they fulfill the requirements of the authority.
• Have suitable facilities that satisfy the requirements to operate as a travel agency in Hong Kong. This means having a dedicated space.
• Additionally, if a company or an individual has a bad criminal record or has filed for bankruptcy will not be able to qualify for a license.

Business Permit

A business permit needs to be applied in the case that a travel agent intends to carry out its business at a local place, meaning having an office, and said space must fulfill the requirements to carry out the services provided by the travel agent. This business permit must be displayed in a place that can be easily found. Additionally, the permit displays the registered address of the business as well as the prescribed fee paid.

Application Process

Once it has been confirmed that you or your company qualifies with the prerequisites, you can proceed with the application process. In this section, we will see the application process for the travel agent license and the business permit.

Travel Agent License

It is important to mention that there is a difference between the application process between companies and individuals, in this section we will summarise the process for both cases:

For applicants which is a company:

• Duly filed F-TA-001E form.
• Certificate of Incorporation.
• Certificate of Business Registration.
• Annual Return showing the most current information of the directors and company secretary (NAR1).
• Information about the controllers of the company:
  For individuals (identification documents)
  For companies (certificate of incorporation or certificate of registration in Hong Kong)
• An organization chart of the company that shows the ownership percentage
• The original document of educational qualification for the Authorised representative.
• Bank guarantee letter for an amount of 500,000 Hong Kong dollars.
• Proof that the minimum capital has been met.
• Statements of accounts that cover the prior 3 months from the date of submission and signed financial position return.

For individuals and partnerships:

• For individuals (identification document such as Hong Kong identity card).
• For partnerships (identification document of the individuals and the certificate of incorporation issued by the Companies Registry.
• Business registration certificate.
• The original document of educational qualification for the Authorised representative.
• Bank guarantee letter for an amount of 500,000 Hong Kong dollars.
• Statements of accounts that cover the prior 3 months from the date of submission and signed financial position return.

It is important to mention that for the submission, it is needed to make an online appointment and pay the required fee for the process. After the process has been approved, a second appointment needs to be done to collect the license.

Business Permit

As for the business permit, these are the documents required:

• For the first-time application or in the case of the change of address, the right to use the local place of business must be provided. For this case, the tenancy agreement or a document that includes the name of the applicant.
• The Business Registration Certificate (BRC).
• The floor plan of the intended place to use to run the business. In the case that the space is shared with other travel agents or travel agencies, a partition must be clearly stated in this document.

How The Renewal Application Process Works

As there is a new regulation with the Travel Industry Ordinance, currently there is a transitional period in which licenses and business permits that have not expired after September 2022 are still considered to be valid and can carry out their related activities and services. More information about the transitional arrangements can be found on the Travel Industry Authority website.

As for the renewal application process, if your company currently has a travel agent license or business permit, the renewal process will be quite simple and even the fee for the renewal will be waived until the end of September 2023 by the Hong Kong authorities. Some of the basic requirements are:

• Holding a valid license
• Premises comply with the requirement of the Directives for Licensees
• Pay the fees for the renewal

More information about the exact fees after September 2023 will be found in the fees table.

Conclusion

As the traveling restrictions in Hong Kong have almost been scrapped and the travel volume rebounds, the traveling industry will increase in the coming years. As we have seen in this article, if an individual or a company wishes to apply for a Travel Agency license in Hong Kong, they need to make sure that they fulfill all the prerequisites and prepare the documents required. It is important to mention that providing services while not holding the proper permits and licenses will be considered an offense that is punishable.