Hong Kong - Company Incorporation

Hong Kong Company Formation

Business Registration

Any person carrying on business in Hong Kong is required to obtain a Business Registration Certificate form the Inland Revenue Department. This is the primary source of information to the taxing authority in respect of new businesses.

Private Limited Companies

Most companies operating in Hong Kong are private companies limited by shares. The main features of a private company limited by shares are as follows:

  • Minimum of two shareholders and two directors.
  • Maximum of fifty shareholders.
  • The transfer of shares in the company must be subject to some form of restriction
  • We are able to arrange for the provision of corporate nominees to act as shareholders and directors if required.

Share Capital

A particular feature of Hong Kong companies is that the share capital need not be in Hong Kong dollars.

Share capital is divided into two forms:

Authorised share capital which sets the maximum amount of capital available and which bears capital duty at the rate of 0.1% payable on company formation and on any subsequent increase of authorised capital. The capital duty is capped at HK$30,000 in each case.

Separate classes of shares with different rights to dividends, etc., are permitted, subject only to any restrictions in the company's Memorandum and Articles of Association. Although shares can be issued which are redeemable by the company, a Hong Kong company cannot buy back its issued shares. No minimum debt to equity ratios and no minimum share capital levels are prescribed for companies, other than those operating in the financial sector, e.g. banks, insurance companies.

Company Officers

The Directors of a private company may generally be either individuals or companies and need not be residents of Hong Kong. Public companies must have at least two Directors as well as a Secretary (who must be resident in Hong Kong and who may be a director). Directors' meetings may take place in Hong Kong and elsewhere. If necessary, an alternate director can be appointed to represent a non-resident director at a board meeting taking place in Hong Kong. There is no restriction which prevents all Directors resolutions being made in writing signed by all Directors, rather than at a meeting of Directors. The particulars of the Directors and the Secretary must be filed with the Companies Registry which must also be notified of any changes in those particulars. We are able to arrange for the provision of corporate nominees to act as Directors or Secretary if required.

Annual General Meeting

Hong Kong companies are regulated by an Ordinance loosely based on U.K. company law. Apart from tax-related matters, the only other compliance requirement is that an Annual General Meeting must be held within 18 months of incorporation and at least once every calendar year thereafter to receive the accounts and elect/appoint officers etc.

Annual Return

Within 42 days from the anniversary of the incorporation date an annual return must be filed with the Registrar of Companies setting out:

  • Share capital
  • Indebtedness in respect of mortgages and charges.
  • Name and address of each shareholder and every person who ceased to be a shareholder in the previous year

Although the return is available for inspection by the general public the amount of information disclosed is limited since:

  • Except in the case of a public company, no financial statements need be attached.
  • Details of shareholders are restricted to the registered shareholders only (e.g. a nominee company), ultimate beneficial owners are not disclosed.

Annual Audit

Every Hong Kong company must have an annual audit performed by a qualified independent auditor.

Availability

Hong Kong shelf companies with standard Memoranda and Articles designed to permit most general activities are available immediately making it possible to commence business at very short notice.