Business License for a Travel Agency
In case the services are related to tours and travel, the business would be categorized as a travel agency.
With your decision to initiate a business in Hong Kong, it is vital to determine what category your company falls under depending on the services that you wish to offer to your clients. In case the services are related to tours and travel, the business would be categorized as a travel agency.
For a person who wants to set up and run a travel agency or even render travel and tour packages that include the transportation services in Hong Kong, a travel agency business license for Hong Kong is required. Here Startupr shares all the information regarding the travel agent’s license explained in detail.
To be allowed to operate a travel agency in Hong Kong, the person would need to issue a Business License for a Travel Agency with the Commerce and Economic Development Bureau of Hong Kong. With this license, a person is permitted to conduct the following activities without any hassle:
- Organizing a package tour or a group tour
- Arranging for a resort or hotel accommodation
- Arranging or selling transportation tickets
Who may apply for a travel agency business license in Hong Kong?
Any person can apply for the Business License for a Travel Agency in Hong Kong where the grant of a license is subjected to some pre-conditions mentioned below:
- The person has to be a member of an ‘approved organization,’ which is the Travel Industry Council of Hong Kong also called the TIA. This is as per the obligations specified in the TAO under Schedule 1.
- The premises of the company or business where the travel agency operations would take place has to be suitable for the purpose.
- The people like an officer, the director, partner or even a secretary, who are responsible for the management and control the business has to be a fit and proper person for them to be associated with the travel agency business. This is as per the opinion of the Registrar and is a vital requirement.
What does ‘fit and proper’ mean?
Before the Business license for the travel agency is issued to the person, the Registrar of Hong Kong would look into the person’s background to find out of the person:
- has been condemned of an offense against any stipulation of the TAO,
- has been sentenced, in Hong Kong or anywhere else in the world, been involved in any offensive, dishonest, corrupt, or fraudulent deeds.
- is not financially stable, or is otherwise a person who is not fit and proper.
When do I need a travel agency license?
The travel agency business license in Hong Kong is mandatory for the person or business that wants to run a travel agency. There are two categories of travel agents as per the Hong Kong Travel Agents Ordinance and they have been explained briefly below:
- Outbound Travel Agent: This is someone who prepares the transportation tickets and books the desired accommodations as per the budget of the travelers on behalf of those who are traveling from Hong Kong to an outside destination.
- Inbound Travel Agent: This is someone who has to arrange for the transportation tickets and book the accommodations for the visitors who are traveling to visit Hong Kong. This agent is also permitted to conduct any tour within Hong Kong while providing local transportation services to the visitors as well.
Before a person can apply for the Business License for a Travel Agency, there are some legal obligations that they must follow. These are:
The first step is to set up a company and obtain the Certificate of Incorporation from the Companies Registry of Hong Kong. For the information on how to set up a business, refer to the Hong Kong Company Registration page of the website.
Suitable office premises
The premises where the business would run has to be suitable for the travel agency business and must further be solely dedicated to the operations of the travel operations only, as per the obligations of the Travel Agent’s Registry. This means that the space of the company cannot be utilized for any other business operation.
Travel Industry Council membership
The candidate needs to be the TIC, also called the Travel Industry Council of Hong Kong’s member. TIC is a self-operating firm and is liable for the improvement of the trade practices in the travel industry. It also formulates and enforces the codes of conducts and demands for the industry, collects statutory levies, handles the complaints and inquiries of the public, etc.
Key executive & other Staff
A person has to be appointed and designated as the key executive of the business where the person would be accountable for the management of the company and has to control the business. A director, secretary, an officer or even the partner can be designated as the key executive of the company.
As per the Registrar of Travel Agents, this person also has to be considered as a “fit and proper” person, which means there shouldn’t be any previous conviction of an offense or bankruptcy. Another crucial requirement is that the key executive needs to be a permanent resident, a citizen or an employment visa holder of Hong Kong.
Additionally, the person needs to be well-experienced in the travel industry with a minimum of two back-to-back years of the same. Along with the key executive, the company needs to hire a full-time staff member as well.
Travel Association membership
In Hong Kong, a travel agency or agent has to be a member of any of the following eight travel associations where each organization has its novel aspects and caters to the particular needs of various markets:
- Hong Kong Japanese Tour Operators Association
- Hong Kong Outbound Tour Operators’ Association
- Hong Kong Association of China Travel Organizers
- Hong Kong Taiwan Tourist Operators Association
- Society of IATA Passenger Agents
- International Chinese Tourist Association
- The Federation of Hong Kong Chinese Travel Agents
- Hong Kong Association of Travel Agents
The corporation needs to have HK$500,000 of minimum paid-up capital.
The application procedure of the business license of the travel agency comprises of submitting the following information and documents to the Hong Kong Travel Agent’s Registry, which also includes the application fee of HKD 630 that is non-refundable:
- The Business License Travel Agency Application Form.
- A genuinely certified copy of the document for the proof of the allotment of shares.
- A genuinely certified transcript of the document verifying the appointment of secretaries and directors.
- An estimation of the business budget for a selected period of either six months or a year, with the estimated expenditure and estimated income given separately.
- A genuinely certified transcript of the record of ownership of the office premises or the stamped tenancy agreement.
- Genuine certified copies of the Travel Association Membership Certificate and the TIC Membership Certificate.
- Genuine certified copies of the Articles of Association of the company, Certificate of Incorporation, and the Business Registration Certificate.
- The aimed travel agency’s scope of business.
- The resumes of each key executive with the emphasis on their travel industry previous work experience.
- A genuine certified transcript of all the key executives’ travel documents or Hong Kong ID cards. The travel documents have to designate that the persons involved have been permitted to get employed anywhere or initiate a business in Hong Kong without any restraints.
- A transcript of the board resolution authenticating the designation of an approved person who would be representing the business while applying for the business license for the travel Agency.
- A statement of particulars form.
When an application for the travel agency business license in Hong Kong is successful, it takes about three to four weeks to process it after which a business license for the travel agency would be issued by the Travel Agents Registry.
It must be noted that the candidate applying for this would need to collect it from the office in person. Based on the period of validity of the license, the fee of HKD 485 per month has to be paid to the Travel Agent’s Registry.
Note that this fee is only for a month, many agents pay for a period of 12-months for the travel agency business license in Hong Kong. Most importantly, the license has to be on display openly in the office at all times while the license number has to be indicated on every company advertisements, pamphlets, brochures, and documents.
For the renewal of the business license of the Hong Kong Travel Agency, the application has to be submitted at least a month before the date of expiry, but not more than two months. In case the form is submitted after the date of expiry, it would not be processed, and the agency would need to apply for a new license again. Additionally, if the business continues to run even after the permit has expired, it would be noted as an offense.
The documents that are needed for the renewal process of the travel agency business license in Hong Kong are:
- A genuine certified copy of a valid Hong Kong TIC membership certificate.
- A genuine certified copy of the business registration certificate that is valid.
- Management accounts and/or audited financial statements, as per the specifications by the registry.
- A statement of particulars form.
- A ‘Renewal of License’ application form.
- Any other document as needed by the Registry.
The successful application gets processed within three to four weeks where the travel agency’s track record of your business would be examined by the Travel Agent’s Registry to verify if it is a genuine TIC member. It is also to confirm if the business meets the obligations that have been particularized in the license while evaluating the renewal form.
If you have all the required documents, comply with the procedures and have excellent records for serving in the travel industry, your application would be accepted. Make sure you are well prepared and have all the documents and understanding of the process in place, to ensure your company for the business license for your travel agency.