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Hong Kong - Buying or Selling a Car

The Hong Kong government discourages private car ownership thanks to the amount of pollution and congestion in the city. As a result, costs of ownership can be high in comparisons to some countries. The fuel costs are expensive, the traffic density is high, and there aren’t many parking spots available. In addition, there is an annual vehicle license fee.

Still, the car buying process is straightforward and similar to purchasing a car in most Western countries. Two of the main rules are that buyers must be over the age of 18 and all vehicles have to be right handed.

Car dealerships exist throughout Hong Kong and there are many secondhand cars for sale, too, since the value of new cars drops rapidly. You can find new cars for sale in newspapers, expat forums, and on notice boards that can be found in public places.

Before you agree to purchasing a car, you should look at the vehicle’s service history and mileage. You might also want to get it checked out by a mechanic or other third party individual who doesn’t have an interest in it. If requested, the Hong Kong Automobile Association will check a vehicle for you.

The Hong Kong Automobile Association
391 Nathan Road, Yau Ma Tei, Kowloon
Tel: 852 3583 3628

If you plan on purchasing a secondhand car then you should apply to the Transport Department’s Licensing Office for the Certificate of Clearance first. This free of charge certificate is valid for 72 hours. It certifies that the vehicle does not have any outstanding penalties nor is it subject to any licensing suspension.

You should at least have third-party insurance cover but you can also get a comprehensive insurance package if you desire. Comprehensive is more expensive, but it offers more coverage. There are large fines, a driving ban, and even prison time for those who are caught driving without the required insurance.

When you purchase the vehicle, the seller and the buyer has to sign the Notice of Transfer of Ownership of a Vehicle through the Transport Department. This must be completed within 72 hours. This form can be downloaded from the Transport Department’s website or picked up from a post office, Transport Department Licensing Office, Home Affairs Public Enquiry Service Centre or the Fax-on-demand Service with the Transport Department Customer Service Hotline.

Transport Department
Tel: (852) 2804 2600

Once the Notice of Transfer is signed, the buyer has to submit it to a Licensing Office in person within 72 hours of the transaction along with the fee, proof of identity, Vehicle Registration Document, and proof of insurance. The seller must submit the duplicate copy of the original form to a Licensing Office. In order to keep it organized and less complicated, the Transport Department recommends that the process itself be conjointly completed at the Licensing Office by both parties at the same time. There are Licensing Offices located in Hong Kong Island, Kowloon, and the New Territories.

If there are any amendments that weren’t endorsed by the new owner and old owner then the application won’t be accepted. In addition, if there are any outstanding First Registration Tax, Registration and License Fees on a vehicle then they will be charged to the seller. If you are selling a vehicle then keep in mind that any that were registered on or after 1 August 1994 can’t be sold at a cost that is more than their taxable value.

If you need the use of a vehicle on occasion but don’t want the hassle of all the maintenance and licensing, then car leasing might be a good alternative. This is similar to renting a car on a long-term basis. The company oversees the maintenance, licensing, and insurance of the vehicle. The only thing that the driver needs to take control of is the parking, monthly rental payments, and the cost of fuel.

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