2023 Update: Comprehensive Understanding of TVP Technology Voucher Application
Since the government introduced the Technology Voucher Program, many businesses have shown keen interest in this government-funded initiative and have been exploring how to apply for this funding. Indeed, the funding amount for technology vouchers can reach up to 600,000 Hong Kong dollars, which is understandably drawing the attention of numerous enterprises. However, applying for technology vouchers is not a simple task, and it cannot be guaranteed that all applications will be successful.
Introduction to Technology Voucher Programme (TVP)
The Technology Voucher Programme (TVP) is a funding initiative introduced by the Hong Kong Special Administrative Region (HKSAR) government. It aims to support small and medium-sized enterprises (SMEs) in Hong Kong in adopting new technologies to enhance their competitiveness and efficiency. The program is administered by the Innovation and Technology Commission (ITC) and provides funding of up to HKD 600,000 for eligible businesses.
Here is some relevant information for a comprehensive understanding of the TVP technology voucher application:
- Scope of Funding: The TVP technology voucher covers a wide range of technology projects, such as web design, data analysis, POS systems, CRM systems, and more. Businesses can choose technology projects that are suitable for their needs and apply for funding.
- Funding Amount: Each eligible business can receive a maximum of HKD 600,000 in funding, which may be adjusted based on the scale and requirements of the project.
- Funding Ratio: The funding ratio for TVP technology vouchers is three to one, meaning the government provides three parts of the funding, and the business contributes one part.
- Eligibility Criteria: To apply for TVP technology vouchers, businesses must meet the following criteria: (a) registered as a small or medium-sized enterprise in Hong Kong, and (b) have not previously received government funding for the same or similar technology projects.
- Application Process: Businesses applying for TVP technology vouchers need to submit an online application through the ITC website, along with the required application forms and documents. After applying, ITC conducts an initial review, and successful applications proceed to the detailed approval stage.
- Approval Process: The approval process for TVP technology vouchers includes initial review and detailed approval. The initial review primarily ensures that applying businesses meet the eligibility and application requirements. The detailed approval involves technical assessment, business evaluation, and project review, with ITC notifying the applying business within 45 working days.
Why Businesses May Encounter Failure When Applying for Technology Vouchers?
- Suspected Collusion Among Technology Vendors The government has a set of requirements for businesses applying for technology vouchers, including obtaining a specified number of quotations based on the project’s value. If applicants cannot meet the required number of quotations, they can only resolve this issue through reasonable explanations, among other methods. However, the practical implementation of these requirements is strict, so businesses must ensure compliance when applying for technology vouchers to avoid being rejected due to suspected collusion.
As previously mentioned, the government mandates that businesses applying for technology vouchers must obtain a specified number of quotations based on the project’s value. However, businesses may unwittingly fall into a trap set by service providers, either due to lack of awareness or other factors. For example, when a business requests a quotation from Supplier A, that supplier may claim to have another shell company, Company B, which is specifically set up to provide enough quotations to meet the business’s application requirements. However, such practices constitute illegal collusion. If the government detects collusion in the quotations submitted by the business, the application for technology vouchers may fail.
What Is Vendor Collusion in Technology Vouchers? Vendor collusion in technology vouchers refers to improper agreements reached among vendors during the implementation of technology voucher projects, such as agreements related to pricing, scope of services, scoring, etc., with the aim of limiting the participation of other competitors and gaining unfair competitive advantages. This behavior goes against the principles of fairness, transparency, and competition, and it damages the image of both the businesses applying for technology vouchers and the technology voucher program itself. Therefore, the government should strengthen supervision and management of the implementation of the technology voucher program to ensure that all vendors have equal opportunities to compete and impose appropriate penalties and sanctions on vendors who violate collusion rules.
Legal Responsibilities and Sanctions for Vendor Collusion in Technology Vouchers Vendor collusion in technology vouchers constitutes unfair competition and may potentially violate relevant laws and regulations such as antitrust laws. Therefore, the government may impose corresponding sanctions and penalties for collusion behavior. Specific legal responsibilities and sanctions may include:
Cancellation or suspension of the technology voucher project: If the government finds evidence of collusion among vendors, it may cancel or suspend the related technology voucher project.
Denial of future participation in technology voucher applications: The government may refuse vendors involved in collusion from participating in future technology voucher applications.
Fines: Colluding vendors may face fines imposed by the government as a penalty for their improper behavior.
Financial loss compensation: If the government and relevant businesses incur financial losses due to collusion, they may seek compensation from the colluding vendors.
Criminal prosecution: Collusion behavior may violate antitrust laws and other relevant legal regulations, potentially leading to criminal prosecution of the colluding vendors.
In summary, the government takes a strict stance against collusion behavior and ensures the fairness, transparency, and competitiveness of the technology voucher program.
Insufficient Supporting Documents When applying for technology vouchers, businesses need to submit relevant supporting documents to meet the government’s eligibility requirements, such as being a company registered in Hong Kong under the Business Registration Ordinance or Companies Ordinance and having substantive business operations in Hong Kong related to the application project. In addition to business registration proof, other documents may be required to demonstrate the ongoing development and operation of the business, such as MPF contribution records. If a business fails to submit the required documents, it may not meet the government’s requirements, leading to a failed application or difficulties during the application process. Therefore, businesses need to understand and prepare all necessary documents to fully comply with the government’s requirements.
Lengthy Waiting Times When applying for technology vouchers, government departments follow a thorough approval process, with each application undergoing internal review, which takes time. While efforts have been made to expedite the approval process, the fact that approval meetings are held only every two months can result in relatively long waiting times for businesses. Extended waiting times can test a business’s patience, and some may become frustrated and give up on their applications, leading to failure in the technology voucher program. Therefore, applying businesses need to exercise patience while awaiting the government’s response and continue to follow up on the application progress to ensure a smooth process.
How to Increase the Success Rate of Technology Voucher Applications?
How to Increase the Success Rate of Technology Voucher Applications?
- Comprehensive Content in the Technology Voucher Application
The technology voucher application is the key document that determines whether an application is successful or not. In addition to providing company information, the application must also provide a detailed description of the content of the technology project. Throughout the entire proposal, it is crucial to clearly state the purpose of applying for the technology voucher, the benefits to the company, and the role of the proposed project. A specific and detailed application can alleviate any doubts the Technology Voucher Program Committee may have and make them believe that the project can be executed reasonably. Therefore, the more specific and detailed the content description in the application, the higher the chances of a successful application.
- Engage Experienced Technology Voucher Consultants
Technology voucher consulting services are external advisory services aimed at providing recommendations to businesses for their technology service or solution adoption plans when applying for technology vouchers. While some businesses may have doubts about the role of technology voucher consultants, in reality, these consultants are essential for increasing the success rate of applications. Applying for the Technology Voucher Program involves filling out numerous forms and providing relevant supporting documents and information. Applying businesses also need to elaborate on their technology needs and plans and provide relevant technical and market research reports, business plans, etc., to demonstrate the feasibility and business value of the proposed project. Given that this requires an in-depth understanding of relevant policies and regulations and a wealth of experience and expertise, technology voucher consultants can assist businesses in understanding the relevant policies and requirements of the program. Furthermore, technology voucher consultants can help businesses select the most suitable technology vendors, provide professional insights and recommendations, and assist businesses in finding technology solutions that best fit their needs. During the application process, technology voucher consultants can liaise with relevant government departments to ensure a smooth application process, preventing businesses from missing out on opportunities due to failed technology voucher applications.
It is worth noting that technology voucher consultants must be companies registered in Hong Kong under the Business Registration Ordinance, and they must have no relationship with the selected or proposed service providers. To successfully apply for technology vouchers, businesses need to carefully consider the content of their applications and the necessary documents and can leverage the expertise and experience of technology voucher consultants to make the application process smoother and more successful.
How to Apply for Technology Vouchers
Any applicant can submit an application through the Technology Voucher Program Management System. Simply visit the Innovation and Technology Commission’s website to submit your application: https://www.itf.gov.hk/l-tc/TVP.asp
Please note: Before submitting the application form, ensure that you have the following required documents:
(a) A copy of the applicant’s Business Registration Certificate Form 1(a)/1(c) or the most recent Annual Return form (Form NAR1) from the Companies Registry. (b) Copies of documents proving that the applicant has substantial business operations in Hong Kong related to the proposed project when applying. Examples include invoices/receipts or business contracts issued within the last three months, the most recent audited accounts, MPF contribution records, and tax assessment notices from the Inland Revenue Department. (c) Copies of valid Hong Kong identity cards or passports of the persons signing the application form on behalf of the applicant. (d) Copies of all signed Declarations of No Collusion and Acceptance of Fair Quotation/Tender according to Section 12 of this guide. (e) Copies of quotations submitted by bidders, showing their detailed contact information (including address, phone, and email). Specify the quotations you intend to select and how each item on the quotations corresponds to the items of expenditure in Section B(I) of the application form.
What Projects Are Eligible for Technology Voucher Funding?
Technology vouchers provide funding to projects that utilize technology services and solutions to enhance productivity or upgrade and transform business processes. A list of typical technology services and/or solutions covered by technology vouchers can be found in Annex 2 of the Application Guide. Applicants can propose other technology services and solutions that achieve the goals of the Technology Voucher Program. Common solutions include user management systems, human resource process redesign, inventory management systems, ERP systems, POS systems, logistics management systems, online sales systems, customer relationship/information management systems, online stores, e-commerce platforms, online hotel booking systems, travel agency websites, insurance brokerage systems, and more.
Can Multiple Technology Voucher Applications Be Submitted?
Each applicant can only submit one technology voucher application at a time. If you need to submit two applications, you must complete the earlier approved project and submit the final project report before submitting a new application.
Can Companies or Organizations Without Substantial Operations in Hong Kong Apply for Technology Voucher Funding?
Companies or organizations registered as “shell companies” or with the majority of their primary business conducted outside Hong Kong are not considered to have substantial business operations in Hong Kong. Therefore, they do not qualify for technology voucher funding.
If a Company Has Received Other Government Grants for a Certain Technology Project, Can It Apply for Technology Voucher Funding Simultaneously?
Applicants cannot simultaneously apply for and receive direct local government funding for the same cost items in the same approved project. If an applicant owns two companies, and one has successfully applied for technology voucher funding, the other company can still apply for funding. However, please note that, since August 14, 2020, different legal entities owned by the same individuals with 30% or more ownership are no longer considered the same entity when calculating cumulative funding amounts.
What Is the Processing Procedure After the Innovation and Technology Commission Receives an Application?
After receiving the application form, the Innovation and Technology Commission will verify its eligibility and conduct an initial assessment. If necessary, the Innovation and Technology Commission may request clarification or supplementary information from the applicant.
Eligible applications will be considered by the Technology Voucher Program Committee (the Committee), while ineligible ones will be returned to the applicant by the Secretariat of the Technology Voucher Program.
The Committee consists of representatives from the business sector, technology sector, professional services sector, and relevant government departments. The list of Committee members can be found on the program’s website. Applications supported by the Committee will be submitted for funding approval by the Director of the Innovation and Technology Commission.
What Are the Evaluation Criteria for Technology Vouchers?
Each eligible application is reviewed and considered on a case-by-case basis. The evaluation criteria for technology voucher projects include:
(a) Whether the proposed project is relevant to the applicant’s business and expected to enhance competitiveness through increased productivity, cost reduction, efficiency improvement, or business process upgrading and transformation. (b) Whether the budget is reasonable. The Committee or the Innovation and Technology Commission may assess the costs by referencing market prices for relevant technology. Each expenditure item should be necessary and directly related to the project. (c) Whether the implementation details are reasonable. Considerations may include whether specific project outcomes have been defined. Additionally, implementation details should be practical based on factors such as the complexity of the technology and the project’s timeline. (d) Any adverse records known to the Technology Voucher Program Committee and the Innovation and Technology Commission regarding consultants and/or service providers, if applicable.
What Are Common Reasons for Past Application Failures?
Each eligible application is reviewed and considered on a case-by-case basis. Common reasons for applications not supported by the Committee in the past include:
Applicants failing to submit the required documents related to their application. Applicant companies not addressing/responding to questions raised by the Innovation and Technology Commission regarding the application in a timely manner. A significant portion of the project’s total cost comprising cost items for off-the-shelf solutions. Projects containing minimal or no technological elements, such as pure purchases of certain hardware or software, making them inconsistent with the program’s objectives.
Will Technology Voucher Funding Be Disbursed in Advance before the Project Starts?
For technology voucher applications received before December 1, 2019, the Innovation and Technology Commission will disburse funding, not exceeding two-thirds of the actual project cost (with the amount approved by the Director of the Innovation and Technology Commission as the upper limit), through reimbursement. Applicants should submit the required documents electronically through the program’s dedicated website within two months after completing the technology voucher project to arrange for the disbursement of approved funding.
For applications received on or after December 1, 2019, the Innovation and Technology Commission will disburse the first installment, up to 25% of the approved funding amount, according to the applicant’s request after signing the funding agreement. Applicants must first invest the same percentage of funding based on a matching principle. The remaining disbursements will be made after the Innovation and Technology Commission accepts the applicant’s project completion report.
Does Successfully Obtaining Technology Voucher Funding Mean That We Can Immediately Receive the Funding After Completing the Entire Project?
Applicants should submit the following documents electronically through the technology voucher program’s dedicated website within two months after completing the technology voucher project to arrange for the disbursement of approved funding:
(a) A final project report indicating the project’s completion, including a summary of project expenses and outcomes. (b) Evidence of project outcomes (e.g., consultant reports, delivery receipts, screenshots of software systems, photos of equipment/hardware, records of training conducted such as photos and training materials, etc.). (c) Original or duplicate invoices and corresponding receipts for each expenditure item. The payee’s name on the invoices and receipts must match the applicant’s name. (d) If the approved funding amount exceeds HKD 50,000, an audited income and expenditure statement for the project, prepared by an independent auditor, must be submitted to the Innovation and Technology Commission. (e) If the approved funding amount is HKD 50,000 or less, the applicant must prepare and submit a final income and expenditure statement, declaring its accuracy and compliance with the provisions of the funding agreement. When preparing the final income and expenditure statement, applicants can refer to the “Auditor’s Guide” in the “Audit Requirements” section mentioned in the Application Guide, which outlines the format of the audited income and expenditure statement. The Innovation and Technology Commission has the right to conduct a detailed review of the final income and expenditure statement.
Late submission of the required documents can result in deferred, reduced, or discontinued disbursement of project funding. If applicants encounter difficulties while submitting the final report or supporting documents through the dedicated website, they can contact the Innovation and Technology Commission for assistance.
