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BUD Fund, a funding scheme that consultants will not tell you.


Many companies would want to expand oversea market but are often shelved due to large capital requirements. In fact, various government funding schemes are provided for company expansion, such as the BUD Fund (Dedicated Fund on Branding, Upgrading, and Domestic Sales) or SME Export Marketing Fund. Below, we are going to introduce you to the popular BUD Dedicated Fund. Don’t miss it if you want to expand your target market.

BUD Fund

BUD Fund offers subsidies to different parts of a business, such as recruiting new employees, promotion and marketing, and machines acquisition. The geographical scope under the BUD Fund includes popular immigration locations, and that is why many companies apply for it.

Purpose of the Fund

To assist enterprises in exploring and developing the Mainland market through developing brands, upgrading and restructuring their operations , and promoting domestic sales in the Mainland.


The requirements for the application are relatively loose. All non-listed enterprises registered in Hong Kong under the Business Registration Ordinance (Chapter 310) with substantive business operations in Hong Kong are eligible to apply. This means limited companies, sole proprietorships, and partnership businesses are eligible to apply.

All non-listed enterprises, irrespective of their industry, whether they belong to the manufacturing or service sector, are eligible to apply.

Geographical Scope of Funding

Except for China and Macau, some popular immigration countries such as Canada, the United Kingdom, and Japan are included in the scheme. The ten member states of the Association of Southeast Asian Nations, the four member states of the European Free Trade Association, Korea, Georgia, New Zealand, Austria, Belgium-Luxembourg Economic Union, Denmark, Finland, France, Germany, Italy, Mexico, Netherlands, Sweden are also within the geographical scope.

Project Duration

Each funded project should be completed within 24 months.

If the funded project has been implemented for less than 18 months, progress report and Audited accounts are not required. For project implemented for more than 18 months to up to 24 months, Audited accounts for the first 12 months and one 12th month progress report are required to be submitted within one month after the relevant 12-month period.

Disbursement of Funds

Each enterprise can apply for BUD Fund for various projects. For example, if company successfully applies for BUD fund to upgrade and restructure in ASEAN markets, it can still apply for funding for branding and expanding businesses in the Mainland market. Maximum of application for each enterprise:

Number of approved projects: 60

Total cumulative funding amount: HK$6,000,000

Funding will be provided on a matching basis, i.e. the Government will cover a maximum of 50% of the total approved project cost, which means the enterprise has to contribute not less than 50% of the total project cost in cash and all the unapproved cost. All funding disbursement by the BUD Fund Implementer in respect of approved projects is to be made on a matching basis.  Depending on the project duration, the arrangement for disbursement of fund is as follows:

Payment OptionProject DurationNumber of InstallmentsInitial payment (% of total approved Government fundingMid-term payment (% of total approved Government funding)Final payment (% of total approved Government funding)
Initial payment required18 months or below275%N/A25%*
 18 to 24 months275%N/A25%*
Initial payment not required18 months or below1N/AN/A100%*
 18 to 24 months2N/A50% at maximum50%*

*Subject to the recognizable total project expenditure on project completion. If the actual expenditure is high than the approved funding, the payment will be limited by the approved funding.

Once a project is suspended or terminated, the applicant will not be entitled to the receipt of Government funding under the BUD Fund. Any cost incurred in the project will be solely borne by the applicant. The applicant should return the Government funding disbursed in respect of these projects (regardless of whether the applicant has already spent the funds or not) together with all administrative, legal and other costs and interest.

Expenditure Items and Funding Ceilings

The expenditures that can be funded by the BUD Fund are relatively diversified. The followings are some funded expenditure items and their funding ceilings.

Expenditure ItemsFunding Ceilings (% of total expenditure of each item)Examples
Setting up a new business entity20%License fee for new business, rent, renovation, utilities, incurred during the project period.
Recruit additional manpower50%Salaries directly incurred for implementing this proposed project
Machinery/equipment70%Including machinery, equipment or mold for the purpose of increasing production capacity
Product samples/prototypes30%Costs of materials and consumables, procuring samples
Advertisement50%Expenses incurred by placing advertisements in any commercial advertising media and related incidental costs, sponsorship, expenses related to engagement of spokesperson, ambassador, Key Opinion Leader (KOL) and/or portrait right, etc.
Exhibitions / promotional eventsNot applicableParticipate in exhibitions/promotional events (including virtual exhibition).
Design and production of promotional materialsNot applicableProduction of promotional materials (e.g. flyers, pamphlets, posters, etc.).
Online sales platform / websiteNot applicableIncluding expenses related to designing and setting up online sales platform.
Travelling and accommodation expenses20%Event-related traveling and accommodation expenses, only in Hong Kong, the Mainland and economies under the Free Trade Agreement and Investment Agreement.
Patent/trademark registrationHK$600,000Cost for patent, trademark, design, utility model registration and/or copyright protection.

Since the funding is allocated according to the actual expenditure, any expenses incurred before the approval of the project may be treated as original expenditure and they will not be included in the actual expenditure. Therefore, one should have a complete plan on expenditure before the application.


Learning more about government funding is beneficial to developing your company effectively and making it easier to enter the foreign market. If you would like to know more about different government subsidizing schemes, please pay attention to our website and we will continue to share more information with you.

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