HK GOV BUD Fund

The Dedicated Fund on Branding, Upgrading and Domestic Sales (BUD Fund) is a Hong Kong government initiative under the Trade and Industry Department. It provides funding support for Hong Kong enterprises to develop brands, upgrade operations, and expand into the Mainland Chinese market (under the Mainland Programme) and other economies with Free Trade Agreements (FTAs) with Hong Kong (under the FTAs Programme), such as ASEAN, Australia, and New Zealand.

Key Features:

  • Maximum Funding: HK$7 million per enterprise (combined ceiling for both programmes).

    • HK$1 million for projects under the Mainland Programme.

    • HK$1 million for projects under each FTA economy under the FTAs Programme.

  • Matching Ratio: 1:1 matching. The government funds up to 50% of the total project cost, the applicant bears at least 50%.

  • Eligible Applicants: Non-listed companies registered in Hong Kong under the Business Registration Ordinance with substantive business operations in HK (at least 3 local employees is a strong proof).

  • Project Duration: Typically should be completed within 24 months.

Step-by-Step Application Process

Step 1: Initial Preparation & Self-Assessment

  1. Check Eligibility: Ensure your company is a non-listed HK-registered entity with substantive operations.

  2. Identify Your Target Market: Is it Mainland China (Mainland Programme) or an FTA economy like Vietnam or Australia (FTAs Programme)?

  3. Develop a Project Idea: The project must fall under Branding, Upgrading, or Domestic Sales.

    • Branding: Trademark registration, logo/package design, brand marketing, etc.

    • Upgrading: Automation, technology adoption, management system certification (e.g., ISO), patent registration.

    • Domestic Sales: Sales channel development (e.g., opening physical stores, setting up e-commerce platforms), marketing campaigns, participation in trade exhibitions.

Step 2: Develop a Detailed Proposal

This is the most critical step. Your proposal must be concrete, justified, and measurable.

  • Clear Objectives: What do you want to achieve? (e.g., "Increase online sales in Guangdong by 30% within 18 months").

  • Detailed Budget: Itemized and justified. Eligible costs include personnel, equipment, marketing expenses, professional services (e.g., consultants, designers), and patent/trademark registration fees.

  • Implementation Plan: Timeline, key milestones, and responsible parties.

  • Expected Outcomes: Quantifiable deliverables (e.g., sales figures, website traffic, number of stores opened).

Step 3: Submit the Application

  1. Choose the Processing Agent: The BUD Fund is administered by the Trade and Industry Department but processed by designated executive organisations. You must submit through one of them:

    • Hong Kong Productivity Council (HKPC) - Handles most general applications.

    • Hong Kong Trade Development Council (HKTDC) - For projects related to their exhibitions or marketing services.

    • Chinese Manufacturers' Association of Hong Kong (CMA)

    • Hong Kong Federation of Industries (FHKI)

    • You can only submit to ONE agent for each application.

  2. Prepare Documents: Typical required documents include:

    • Fully completed Application Form.

    • Business Registration Certificate.

    • Company Information (structure, shareholders, etc.).

    • Proof of Substantive Business Operations (MPF contribution records for at least 3 local staff, office rental agreement, audited financial reports).

    • Detailed Project Proposal & Budget Sheet.

    • Quotations/Tenders for major project expenditures (usually required for items over HK$50,000).

  3. Submit Online: Applications are submitted via the executive organisation's online portal. There is no fixed deadline; applications are accepted year-round.

Step 4: Application Assessment & Approval

  • The executive organisation will review and may request clarifications.

  • They will then make a recommendation to the Funding Committee (comprising government officials and industry representatives) for final decision.

  • The assessment period usually takes 2 to 4 months.

  • You will receive a formal Approval Letter if successful, outlining the approved scope, budget, payment schedule, and reporting requirements.

Step 5: Project Implementation & Claiming Funds

  • Sign Agreement: You must sign a funding agreement before starting the project.

  • Start Project: You can begin only after receiving the approval letter. Expenses incurred before approval are NOT eligible.

  • Claims & Payments: Funding is disbursed in installments, typically:

    • First Claim (Upfront): Up to 75% of the government's approved grant after signing the agreement and submitting a banker's guarantee (if required).

    • Interim/Final Claims: Reimbursement of the remaining balance upon submission of audited accounts, activity reports, and proof of expenses.

  • Audit Requirement: You must hire an independent auditor (as listed in the BUD directory) to audit the project accounts and certify the use of funds for the final claim.

Step 6: Project Completion & Final Reporting

Submit a comprehensive final report, audited accounts, and all supporting evidence (receipts, contracts, photos, marketing materials) to the executive organisation to close the project.

Crucial Tips for Success

  1. Seek Professional Help: Consider hiring a BUD Fund consultant. They understand the assessment criteria, can help craft a compelling proposal, and navigate the complex administrative process, significantly increasing approval chances. Their fee can be included in the project budget.

  2. Justify Every Dollar: The budget must be realistic and market-priced. Obtain multiple quotations for major items.

  3. Focus on "Hong Kong Benefits": Clearly articulate how the project will benefit your HK company (e.g., increased profits, job creation for HK staff, enhanced competitiveness).

  4. Start Simple: If you are a first-time applicant, consider a smaller, well-defined project (e.g., a trademark registration and a targeted online marketing campaign) to build a track record.

  5. Use Official Resources:

    • Official BUD Fund Website: www.bud.hkpc.org - The most authoritative source for forms, guides, and FAQs.

    • Contact the Executive Organisations: Attend their free briefing sessions and seminars.

Common Pitfalls to Avoid

  • Starting the project before approval.

  • Vague project descriptions without measurable KPIs.

  • Including ineligible costs (e.g., purchase of property, routine operational costs like office rent unrelated to the project).

  • Poor record-keeping during implementation, making the audit difficult.

  • Failing to report significant changes to the project scope/budget on time.

Summary: The BUD Fund is a powerful tool but requires meticulous preparation and compliance. Start by thoroughly reviewing the official guidebook, plan your project with clear goals and a solid budget, and consider engaging a professional to guide you through your first application.