Given its proximity to Mainland China, the Hong Kong Special Administrative Region could be a viable initial option either for selling into, or sourcing from, China. However Hong Kong is a distinct commercial jurisdiction with different legislation, legal system and currency from Mainland China. You will not be able to: hire local Mainland Chinese to work for you legally on the Mainland; issue official invoices (“fapiao”) that are recognised by the Mainland tax authorities to your Mainland Chinese clients; or spend a substantial amount of time on the Mainland developing and conducting business. As your business grows, you will have to consider a presence on the Mainland. Hong Kong may, however, be a good location to set up an offshore holding company for a Mainland China company.