John Wiley & Sons UK2 LLP & Wiley International LLC v The Collector of Stamp Revenue 

[2025] HKCFA 11, the CFA dismissed the taxpayers’ appeal and held that a UK LLP does not have “issued share capital” for the purpose of claiming stamp duty relief under s.45 of the Stamp Duty Ordinance (Cap. 117).

This is a landmark case not only in Hong Kong (being the first to consider s.45 relief), but also in the common law world (being the first to consider whether an LLP has “issued share capital”).

Under s.45, the transaction is entitled to stamp duty relief if the transfer is between associated bodies corporate, where one is beneficial owner of not less than 90% of the “issued share capital” of the other. The relevant transaction involved the transfer of the entire issued share capital of a HK company by a UK LLP to its indirect owner, a company incorporated in Delaware, USA.

The CFA agreed with the definition of “issued share capital” provided by the Court of Appeal below, namely the total monetary value of the consideration paid or agreed to be paid by the shareholders in return for shares of a company as have been issued. It being undisputed that an LLP cannot issue and allot share capital, the Appellants could not satisfy the association criterion of s.45.

The CFA dismissed the Appellants’ definition of “share capital” (as a “taxonomic class” looking to features of an LLP “materially analogous” to “share capital”) as vague and uncertain with no support in the historical context of s.45.

Finally, the CFA held that the term “issued share capital” is to be read in the same way regardless of whether foreign corporations are involved. Whether s.45 should be rectified to account for cases such as the present is a matter for the legislature.

, instructed by the Department of Justice, appeared for the Respondent.

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