There is no ’offshore’ legislation in Hong Kong. All companies are incorporated under the same legislation – HK Company Ordinance, 2014 version, whether they are doing business locally or ’offshore’.
To do business in Hong Kong, one can set up a sole proprietorship, a partnership or register one’s own company incorporated elsewhere as an overseas company in Hong Kong. However, the most common form of business entity in Hong Kong is the private limited company, which limits the liability of the shareholders to the capital subscribed.
Hong Kong private limited companies must use the suffix Limited or Ltd. to denote limited liability. The following names to be used, require licensing: Bank, Insurance, Assurance, Re-Insurance, Trust, Trustee, Savings, Royal, Asset management, Fund Management, Investment Fund, Building Society, Municipal, Chartered, Chamber of Commerce, Tourist Association, Kaifong, Mass Transit, Underground Railway. Names denoting any connection to local, state or national Governments are generally prohibited.
ARTICLES OF ASSOCIATION
A company is incorporated in Hong Kong by application made to the Registrar of Companies. Articles of Association and Statement of Compliance must be lodged with the Registrar. Articles of Association specifies the activities in which the company may engage the rules governing the internal management of the company. A Notice of Situation of Registered Office is also required to be filed within fourteen days of the date of incorporation. Business registration fee has to be paid to the Inland Revenue Department within 30 days after the date of anniversary of incorporation, and then each year thereafter. Government fee is HK$2,600.
A minimum of one shareholder is required which may be an individual or a corporate body. Details of the shareholders must be filed and appear on the public file, but anonymity can be preserved by the use of nominee shareholders.
Under the Companies Ordinance, Cap. 32 companies incorporated in Hong Kong and having a share capital are required to have a par value ascribed to their shares. This represents the minimum amount at which a share can be issued.
Companies must also declare in their Articles of Association the maximum amount of share capital that may be issued by the company (the requirement for “authorized share capital”).
The amount of the excess of the issue price of the share over its par value is designated as “share premium”. Under Cap. 32, there are restrictions on how a company can deal with share premium and how it must be accounted for.
As a result of migration to mandatory no-par, relevant concepts such as par value, share premium, and requirement for authorised share capital are no longer necessary.
A company will have greater flexibility to alter its share capital in a no-par environment, for example, a company will be able to capitalise its profits without issuing new shares and to allot and issue bonus shares without increasing its share capital (section 170 of the new CO).
Kong Hong limited company requires a minimum of one director who is a natural person. Details of the directors appear on the public file, but anonymity can be preserved by the use of nominee directors. There is no requirement to have resident directors.
PLEASE CONTACT US IF YOU ARE INTERESTED IN OUR NOMINEE DIRECTOR SERVICES.
REGISTERED OFFICE AND SECRETARY
Every company, registered in Hong Kong is required to have a registered office and address there, which should be notified to the Registrar. Hong Kong registered companies must also have secretary, who can be corporate body or individual resident in Hong Kong.
Company meetings need not be held in Hong Kong.A general meeting can be held at more that one location by using any technology.
An annual general meeting (AGM) must be held once in every calendar year and not more than 15 months after the last preceding AGM. However, a company need not hold its first AGM until 18 months of its incorporation. A company can dispense with the holding of AGM if everything that is required or intended to be done at the meeting is done by resolutions.
Companies may dispense with the holding of AGMs by unanimous shareholder’s consent.
TIME NEEDED FOR FORMATION
7 – 14 working days.
RECURRING AND MAINTENANCE FEE AS FROM 2ND YEAR
- Provision of registered office/registered address
- Provision of company Secretary
- Payment of annual government fee
- Provision of Annual Return