For over a decade, the Hong Kong SAR Government had been modifying the specific tax exemption regimes for investment funds (especially privately offered funds) with a view to attracting more funds and fund managers to establish themselves in Hong Kong.
The journey began in 2006 when the first offshore fund exemption regime (section 20AC of the Inland Revenue Ordinance (“IRO”)) was introduced; this regime basically provides Hong Kong profits tax exemption for privately offered nonresident hedge funds retrospectively from the year of assessment 1996/97.
Amendments were made in 2015 (section 20ACA was added) to expand the scope of exemption to cover privately offered private equity (“PE”) / venture capital (“VC”) funds provided certain conditions are met.
Source: https://www.tihk.org.hk