Viewpoints

1. Qualification of Company Secretary In accordance of the Hong Kong Companies Ordinance, every company registered in Hong Kong shall have a secretary. With effect from the date of incorporation of a company mentioned in its certificate of incorporation, the first secretary of the company is the person named as the secretary in the incorporation form submitted in respect of the company. A director of a company may at the same time acting as the secretary of the company. However, the director of a private company having only one director shall not also be the secretary of the company. The secretary of a company shall- (a) if an individual, ordinarily reside in Hong Kong; (b) if a body corporate, have its registered office or a place of business in Hong Kong. Anything required or authorized to be done by or to the secretary may, if the office is vacant or […]

1. Number of Directors In accordance with the “Companies Ordinance”, a private company limited by shares must have at least one director. There is on restriction on the maximum number of directors. 2. Reserve Director In accordance with the Hong Kong Companies Ordinance, where a company which has a single member who is also the sole director has the option of nominating a “reserve” director to act in place of the sole director in the event of his death. The nominee (reserve director) must have attained the age of 18 and his particulars must be registered with the Companies Registry. 3. Qualification of Directors Both individual and corporation can act as director of a Hong Kong company. Also, the director can be of any nationality and be resident anywhere in the world and meetings can take place anywhere. A director must be over the age of 18. The Hong Kong […]

1. Minimum and Maximum Numbers of Shareholders In accordance with the Hong Kong “Companies Ordinance”, a private company limited by shares must have at least one shareholder and but could not have more than 50 shareholders (members). Employees and previous employees holding shares in the Company are not to be treated as shareholder. In addition, two or more persons hold shares in common is deemed as one shareholder. 2. Qualification of Shareholders Both individual and corporation could be shareholder of a Hong Kong company. Also, the shareholders can be of any nationality and be resident anywhere in the world and meetings can take place anywhere. The Companies Ordinance requires that an individual must be over the age of 18 to hold shares in a Hong Kong company. 3. Disclosure The name and occupation and residential address of the shareholders must be registered with the Companies Registry and entered the Register […]

To form a company under the Hong Kong Companies Ordinance, certain documents must be prepared which will form the constitution (bylaws) of the company. The constitution or bylaws of a Hong Kong incorporated company is commonly known as Memorandum and Articles of Association. The Memorandum and Articles of Association must be registered with the Companies Registry. (1) The Memorandum and Association This must contain – (a) The name of the company In relation to choosing the name of the company a number of matters must be considered: It should be noted that pursuant to Hong Kong Companies Ordinances, no company may be registered by a name which the Hong Kong Government regards as undesirable. The name of the proposed company must in addition be different to names already on the Register. The words “bank” or “insurance” must only be used where there is an appropriate license or exemption. In addition, […]

General Requirements of a Company Name A company may be registered with an English name, a Chinese name, or an English name and a Chinese name. A company name with a combination of English words/letters and Chinese characters are not allowed. An English company name must end with the word “Limited” and a Chinese company name must end with the characters “有限公司”. A Chinese company name should contain traditional Chinese characters (繁體字) that can be found in the Kang Xi Dictionary (康熙字典) or Ci Hai Dictionary (辭海) AND also in the ISO 10646 international coding standard. Circumstances in which a Company Name will NOT be registered Generally speaking, a company name will not be registered if:- it is the same as a name appearing in the Registrar’s index of company names; it is the same as that of a body corporate incorporated or established under an Ordinance; in the opinion […]

Features of Hong Kong Private Companies Limited by Shares Type of Company for International Trade and Investment Private Company Limited by Shares (Limited Liability Company, Private Company, LLC). Restrictions on Trading Cannot undertake banking or insurance activities or financial business (such as currency trading) unless relevant licenses are obtained. Power of Company A Hong Kong Company has all the powers of a natural person. Language of Legislation and Corporate Documents Legislation in both English and Chinese; incorporation documents, such as Memorandum and Articles of Association (also known as Articles of Association, bylaws and constitutions in other countries), Notification of Appointment of First Directors and Secretary etc. could be prepared either in English or Chinese. Name of Company It is not possible to reserve a name. It is essential to check that there is no similar or identical name on the Register of Companies maintained by the Companies Registry, which would […]

Introduction Choosing the location of holding company or regional holding company can be a daunting decision for many international structures. The minimization of tax, cost and risk are the main concerns. With the robust economy of China, coupled with the accession of China and Taiwan into WTO, much interest has been seen in investing in the Greater China or even the Asia Markets. Some investors may prefer to set up an appropriate holding structure within Asia. Criteria for Choosing a Suitable Jurisdiction for Holding Companies Low Cost and Risk Considering cost and risk, a favorable jurisdiction for setting up holding companies should have the following characteristics: (1) There are no minimum capital requirements; (2) Except in case of public companies, there is no requirement to file accounts with the company house, thus avoiding financial information being available to the public; (3) Ease of setting up, relocation and dissolution when the […]

Industrial climate Hong Kong has a free-enterprise, free-trade economy. The government has traditionally adopted a policy of nonintervention in the private sector, while at the same time providing the territory with a modern and sophisticated commercial infrastructure and a sound legal and administrative framework. The result of this government policy, an entrepreneurial population and an industrious workforce is a highly prosperous economy with one of the highest per capita GDPs in the Asia-Pacific regions. The Hong Kong economy is based on trade, and Hong Kong now ranks as the world’s fifth-largest trading nation. It is estimated that approximately 90 percent of Hong Kong’s manufacturing output is eventually exported. Hong Kong lacks most natural resources and is therefore heavily dependent on imports. However, because Hong Kong is primarily a free port (imposing no customs duties on imported goods), this does not pose a problem. In recent years, the limited supply of […]

Hong Kong BVI General Type of Company Private Limited Company Business Company Political Stability Good Good Common or Civil Law Common Common Disclosure of Beneficial Owner No No Migration of Domicile Permitted No Yes Tax on Offshore Profits No Nil Corporate Requirements Minimum Number of Shareholders One One Minimum Number of Directors One One Corporate Shareholders Allowed Yes Yes Bearer Shares Allowed No No Corporate Directors Permitted Yes Yes Company Secretary Required Yes No Standard Authorized Share Capital HKD10,000 50,000 shares Local Requirements Registered Office/Agent Yes Yes Company Secretary Yes No Local Directors No No Local Meetings No No Government Register of Directors Yes No Government Register of Shareholders Yes No Annual Requirements Annual Return Yes No Filing of Changes Yes Yes Submit Audited Accounts Yes No Tax Filing Yes No Recurring Government Costs Minimum Annual Tax/License Fee HKD2,250 USD350 Annual Return Filing Fee HKD105 N/A Taxes Value Added Tax […]

Overview Hong Kong adopts a territorial source principle of taxation. Only profits which have a source in Hong Kong are taxable here. Profits sourced elsewhere are not subject to Hong Kong Profits Tax. The principle itself is very clear but its application cases can be, at times, contentious. This guideline note gives a brief explanation of how the principle operates and provides simple examples for illustrative purposes of the tests applied to different types of businesses. Hong Kong’s basis of taxation on profits from businesses Profits of manufacturing businesses Pre-conditions for liability to Profits Tax Sale or purchase commissions Basic principles for determining the source of profits Treatment of other profits Profits of trading firms Apportionment of profits and expenses Advance rulings Hong Kong’s Basis of Taxation on Profits from Businesses Hong Kong adopts a territorial basis for taxing profits derived from a trade, profession, or business carried on in […]