What exactly is the BUD Fund and how does it work for Hong Kong businesses?
The BUD Fund (short for Branding, Upgrading, and Domestic Sales Fund) is a government subsidy launched in 2012 to help Hong Kong small and medium enterprises (SMEs) expand beyond the local market. In simple terms, it shares part of the cost when companies want to build their brand, upgrade operations, or grow sales overseas.
Today, the programme covers Mainland China, the 10 ASEAN countries, and the economies under Hong Kong’s Free Trade Agreements (FTA) and Investment Promotion and Protection Agreements (IPPA) with the exact list updated from time to time in the official guide.
Why does this matter? Because focusing only on Hong Kong can limit growth. The BUD Fund gives SMEs a chance to test demand abroad whether that means opening an online store in Southeast Asia or setting up a branch in Mainland China without shouldering the full financial burden alone.
1. Who can apply for the BUD Fund in Hong Kong?
The BUD Fund is designed for Hong Kong-based small and medium enterprises (SMEs). The rules are clear, but it helps to check them step by step. To qualify, your business must:
- Be a non-listed company registered under the Business Registration Ordinance.
- Have substantive business operations in Hong Kong, shown through documents such as audited accounts, MPF records of employees, or sales invoices.
- Meet all licensing, certification, or qualification requirements in the target market throughout the project.
Documents commonly required for eligibility
When applying, you should be ready to provide:
- Business Registration Certificate (BR)
- Certificate of Incorporation (CI)
- Company Registry filings (e.g. NNC1 for new, NAR1 for existing >1 year)
- Proof of substantive operations – such as audited accounts, 3 months of bank statements, tenancy agreement, MPF contribution records, or sales invoices/contracts
- Latest year’s sales turnover record
- Other supporting documents if requested (e.g. employee insurance, utility bills, office/store photos)
💡A common misconception is that only large or well-established firms can apply. In fact, startups and smaller businesses can also benefit as long as they prove genuine operations in Hong Kong.
2. How much funding can you get from the BUD Fund?
The BUD Fund provides financial support for Hong Kong companies, but it comes with clear limits that businesses need to plan around:
- Regular BUD projects: up to HK$800,000 each
- Easy BUD projects: up to HK$100,000 each
- E-commerce Easy projects: a special pool with a HK$1 million cumulative cap per company, earmarked specifically for e-commerce initiatives across the company’s lifetime
- Enterprise-level ceiling: up to HK$7 million in total funding, spread across as many as 70 approved projects over time.
💡At-a-glance comparison
Concurrent funding limit
At any one time, the total approved and ongoing funding across all your BUD projects cannot exceed HK$800,000. For example, if you already have an Easy BUD project of HK$500,000 in progress, you can only apply for an additional HK$300,000 until that project is completed. Many companies sequence their projects: finishing one before applying for the next to maximize their available room under this limit.
Practical tip: Think of the BUD Fund as a funding pipeline rather than a one-off grant. The concurrent cap means timing matters as much as project design. Companies that plan their project size and order in advance often make better use of the overall HK$7 million quota.
3. Do you need to pay first or does the government pay upfront?
One key thing SMEs should know about the BUD Fund is how the money actually flows. A common misconception is that the government pays most of the funding upfront but that’s not the case. The arrangement depends on which stream you apply for:
- Easy BUD → Works on a reimbursement basis only. Your business must settle all approved project costs first, then claim back the government’s share after the project is completed and audited.
- General BUD and E-commerce Easy → Offer more flexibility. You can choose between full reimbursement or requesting a small initial payment of 20% of the government’s approved share, with the balance reimbursed once the final report and audit are accepted.
In all cases, the matching ratio is 25% (government) : 75% (enterprise).
💡Practical tip: treat it as reimbursement
The toughest part for many SMEs isn’t eligibility, but cashflow. A smart rule of thumb is to prepare the full 100% of your project budget upfront and treat the government’s contribution as money that will come back later, not as working capital. This way, your project won’t stall due to reimbursement delays or unexpected costs, and the 25% subsidy becomes a cushion rather than a dependency.
4. What can the BUD Fund be used for (and what’s not allowed)?
Think of the BUD Fund as a boost for specific projects that grow your brand and sales overseas. It’s not for keeping the lights on in your office.
3 Golden Rules to remember:
- Must be project-related (not day-to-day business)
- Must be time-limited (linked to this project only)
- Must help you expand outside Hong Kong
💡At-a-glance comparison
5. What types of BUD Fund applications can you submit?
The BUD Fund isn’t “one size fits all.” Depending on your project, there are different tracks you can apply under. Here’s a simple guide:
- Easy BUD: Quick and Simple
- A fast-track option for smaller projects up to HK$100,000. It’s designed for SMEs that want to try new ideas quickly with less paperwork. Projects must be finished within 12 months, and the work is carried out by the business itself.
- Funding limit: HK$100,000 per project
- Duration: Max 12 months
- Best for: SMEs testing the waters with small-scale projects
- A fast-track option for smaller projects up to HK$100,000. It’s designed for SMEs that want to try new ideas quickly with less paperwork. Projects must be finished within 12 months, and the work is carried out by the business itself.
- Regular BUD (Mainland): Expanding into China
- The mainstream BUD Fund for businesses targeting the Mainland market. It supports branding, upgrading operations, and boosting domestic sales.
- Funding ratio: 25% government, 75% business
- Scope: Branding, upgrading, sales promotion in Mainland China
- Best for: Companies with a structured Mainland expansion plan
- The mainstream BUD Fund for businesses targeting the Mainland market. It supports branding, upgrading operations, and boosting domestic sales.
- Regular BUD (FTA/IPPA): Entering Overseas Markets
- This stream supports SMEs expanding into economies covered by Hong Kong’s Free Trade Agreements (FTAs) and Investment Promotion and Protection Agreements (IPPAs) - including ASEAN, Australia, Chile, and more (see the latest guide for the full list).
- Coverage: Mainland China, the 10 ASEAN countries, and other FTA/IPPA economies
- Best for: Businesses looking beyond China into new overseas markets
- E-commerce Easy: Growing Online
- A simplified path focused on digital expansion. It covers things like setting up an online shop, joining e-commerce platforms, and digital marketing campaigns.
- Application: Simplified process
- Scope: Website upgrades online store creation, digital ads
- Best for: SMEs moving quickly into e-commerce
- A simplified path focused on digital expansion. It covers things like setting up an online shop, joining e-commerce platforms, and digital marketing campaigns.
6. What are the key rules and common mistakes in BUD applications?
Applying for the BUD Fund is not just about having a strong project idea. The application process is strict, and small missteps can lead to long delays or even outright rejection. Here’s what every SME should know.
Key rules to follow
- Stay within the live cap:
At any one time, the government-funded portion of all your ongoing BUD projects cannot exceed HK$800,000. Plan the size and timing of your projects so you don’t get stuck at the ceiling. - Show you are a real HK business:
You must be a non-listed company with substantive operations in Hong Kong. That means having up-to-date documents like your BR Certificate, audited accounts, MPF contributions, tenancy proof, or sales invoices. You’ll also need to keep valid licences or certifications in the target market throughout the project. - Pick the right track:
Easy BUD is for self-run projects (≤12 months). Regular and E-commerce Easy allow larger projects but still require clear, time-bound deliverables. - Follow procurement rules:
Respect item caps and keep proper quotes, contracts, and invoices. Don’t slip in costs outside the scope or geography. They won’t be “fixed later” for you. - Budget for reimbursement:
Even where a small initial payment is possible, treat BUD as a reimbursement-first scheme. Be prepared to pre-fund the project in full, then claim the government’s 25% share later.
Common mistakes that cause rejection
- Weak or inconsistent proof of operations:
Your BR, CI, or NAR1 details must line up with your tenancy, MPF, bank statements, invoices, and audited accounts. Missing recent transaction records is one of the most common reasons applications get stuck or rejected. - Framing routine work as a “project”:
The BUD Fund supports time-limited, expansion-focused projects, not day-to-day operations. Ongoing retainers, maintenance, or general staff salaries often get flagged and removed. Easy BUD in particular will reject proposals without clear deliverables tied to market entry or growth. - Picking the wrong track (or breaking track rules):
Easy BUD must be self-implemented and wrapped up within 12 months, with very limited change requests. Trying to outsource work or apply for long extensions under Easy BUD almost always leads to rejection. - Poor procurement trail:
Your paperwork has to line up. Quotes should be obtained before payment, match the contracted scope, and be backed up with selection rationale, contracts, and invoices. Missing probity forms or mismatched documents is a red flag for auditors. - Geography or eligibility mismatches:
BUD only covers Mainland China, ASEAN, and FTA/IPPA economies. Adding markets outside the scope or skipping required local certifications will see items struck out or entire projects rejected. If a license is needed in the target market, build it into your project plan. - Budget lines without proof:
“Recruit additional manpower” isn’t enough. You need job descriptions, duties linked to project tasks, and salary benchmarks. Without this, claims are often cut down or refused. - Vague or generic proposals:
Applications with lines like “do marketing” or “expand sales” rarely pass. Every activity should link to a deliverable, date range, and target market. Vague content is a common trigger for rejection.
Quick fixes when drafting
- Anchor every budget item to a clear deliverable, timeline, and target market
- Prepare your operations proof pack early: BR, CI, NAR1, MPF, tenancy, bank statements, invoices, and audited accounts if available
- For manpower, include job posts, duties, and salary benchmarks from reliable sources
- Lock down procurement before submission: get at least 2 comparable quotes, probity forms, and ensure contracts and invoices mirror the quoted scope
7. How do you apply for the BUD Fund step by step?
Applying for the BUD Fund takes preparation, but if you follow the steps carefully, you can avoid most of the common pitfalls. Here’s a simple step-by-step guide:
- Step 1: Check if you’re eligible
- Make sure you’re a non-listed Hong Kong company with real operations in the city. That usually means having proof like audited accounts (if over 18 months old), MPF or sales invoices, tenancy, and recent bank statements. Also confirm your project is expanding outside Hong Kong and that you meet any licences or certifications needed in the target market.
- Step 2: Gather the required documents
- Prepare a “document pack” early to avoid delays. This normally includes:
- Company records (BR, CI, NNC1/NAR1)
- Proof of operations (3 months of bank statements, MPF records, tenancy, sales and supplier invoices, office photos, insurance)
- Project support docs (vendor quotations, probity and non-collusive forms, auditor quote, and any required market licenses)
- Step 3: Build a clear budget and scope
- Create a detailed expenditure breakdown linking every cost to a project deliverable, timeline, and target market. If you plan to hire new staff, include job duties tied to project tasks and show salary benchmarks.
- Step 4: Pick the right application type
- Choose the track that matches your project:
- Easy BUD → self-implemented, ≤12 months, smaller scale
- General BUD (Mainland/FTA/IPPA) → broader projects, can use vendors, longer timelines
- E-commerce Easy → simplified process for digital expansion
- Step 5: Draft your proposal
- Map every activity to specific outcomes, KPIs, and timelines. Keep the language project-based, time-bound, and expansion-linked. Avoid vague lines like “do marketing” — reviewers want to see concrete deliverables.
- Step 6: Complete the online application
- Log into the BUD portal and select the right programme (Mainland or FTA/IPPA). Fill in the form using your document pack and budget breakdown. Make sure your quotations and probity forms match the scope and dates.
- Step 7: Review internally before submission
- Do a final check: eligibility proofs, budget-to-deliverable mapping, procurement documents, and compliance with the target market. Get sign-off from key stakeholders before submitting.
- Step 8: Submit and track progress
- Submit your application through the e-form system. Then monitor the status and reply quickly if the BUD Secretariat asks for clarifications. Keeping a tidy working folder and communication log will save time.
- Step 9: Execute your project as approved
- Once approved, stick to the approved scope, timeline, and procurement rules. Keep all quotes, contracts, invoices, payments, and delivery evidence neatly aligned for the audit.
- Step 10: File your claim and audit
- At project end, compile all invoices, receipts, payment proofs, and evidence of deliverables. Your external auditor will prepare the audit report. Submit both the final report and audit for reimbursement. Strong document alignment helps speed up disbursement.
- At project end, compile all invoices, receipts, payment proofs, and evidence of deliverables. Your external auditor will prepare the audit report. Submit both the final report and audit for reimbursement. Strong document alignment helps speed up disbursement.
💡 Pro tips: Lock in procurement early and keep your paper trail clean. Missing or mis-dated quotes cause major delays.
8. Where can you find resources and support for the BUD Fund?
Applying for the BUD Fund can feel overwhelming, but there’s plenty of help out there if you know where to look. Here are the most useful places to get reliable information, templates, and guidance:
Official sources
- HKPC BUD / FTA-IPPA portal – the official hub for application guides, programme rules, FAQs, and forms. It also features success stories and tips straight from past applicants.
- Guide to Application (FTA/IPPA) – the government’s detailed step-by-step reference. It includes the full list of eligible markets, funding caps, and document requirements.
- Trade & Industry Department (TID) – publishes official press releases, policy updates, and circulars. Enhancements like Easy BUD or E-commerce Easy are usually first announced here.
Partner & intermediary support
- BUD consultants – Specialist consultancies offer hands-on support for proposal writing, budgeting, and compliance checks. Many SMEs engage them when time or in-house expertise is limited.
- Industry bodies – Associations like HKTDC’s SME Centre (via the T-box programme) and chambers of commerce (e.g. HKGCC) regularly host funding workshops. Some even invite SME ReachOut (HKPC’s advisory team) for one-on-one consultations with members.
- Service vendors – IT firms, branding agencies, or marketing companies that you might hire for your project often help with the application too, since securing funding makes it easier for you to pay for their services.
- Workshops/webinars – HKPC frequently runs free “form-filling” or BUD application walkthroughs. HKTDC and chambers often co-host sessions with HKPC officers, and slides or recordings are usually available afterwards. These serve as ready-made checklists you can refer back to.
Expert review & peer feedback
- SME ReachOut (HKPC) – a government-funded advisory service offering free one-on-one reviews of your draft application and answers to specific questions. They can point out missing items before you submit.
- Peer founders & networks – Communities like HKPC’s InnoPreneur Network or informal WhatsApp/Telegram groups of SME owners often share their personal experience with BUD: which vendors worked, how audits are handled, or how long reimbursements really take.
- Mentors or advisors – If you have industry-specific mentors, ask them to review your draft. A quick critique from someone who’s been through the process often surfaces blind spots you might have missed.
9. Is the BUD Fund the right choice for your business?
The BUD Fund can be a powerful tool if you’re a Hong Kong SME looking to grow beyond the local market. It works best for companies that already have solid operations in Hong Kong, a clear expansion plan, and the ability to pre-fund project costs before claiming the subsidy back.
If your business is at the stage where you’re ready to test demand overseas, upgrade your brand, or scale into e-commerce, the BUD Fund could be the right fit. On the other hand, if you’re still building your foundation locally, you may want to strengthen your operations first before applying.
👉 The key is to weigh your goals, cash flow, and compliance readiness. With good planning and the right support, the BUD Fund can reduce your risk and help accelerate your growth into new markets.
10. Final thoughts
Government funding can feel complicated, but the BUD Fund is one of the most practical ways for Hong Kong SMEs to reduce risk while expanding overseas. By preparing the right documents, planning your budget carefully, and keeping a clean paper trail, you can greatly improve your chances of approval and smooth reimbursement.
If you’re ready to take the next step, start by checking your company’s eligibility and mapping out a project that’s time-limited, market-focused, and growth-driven. And if you need guidance along the way, there are resources, from official guides to expert advisers, to help you navigate the process with confidence.
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