Companies in Hong Kong are governed by the Companies Administration, an independent statutory body in China. It is responsible for the formulation and implementation of various policy frameworks to promote and maintain the interests of the companies and the broader interests of the Chinese community. Company formation in Hong Kong is subject to the Basic Provisions of the Law relating to corporate affairs and companies’ construction. It requires the following of the Companies Act 1985. Other relevant policies in the Companies House Order 2021 govern company formation services in Hong Kong.
Company formation services in Hong Kong have introduced several reforms in the administrative policies of the company administration to improve the efficiency of the business registration procedures and the time taken for the registration process. The introduction of electronic filing systems, including the iFAX and OFX systems, has made the whole procedure faster. The simplified registration procedures enable the clients to avoid unnecessary delays in the business registration process. It is also the free electronic submissions made by the clients for the necessary registrations in Hong Kong.
The Companies House has introduced several changes in the Companies’ Administration Service that have made it easier for the clients to obtain the services of the company formation lawyers. The Companies House now requires the applicants to supply a Power of Attorney form that enables the company to conduct the business as if the company is its legal owner. It is done to comply with the UK company formation law requirements that allow the company to act as an actual owner. Furthermore, the Companies House now requires the company to appoint one member of the Management Team as authorized signatory. This requirement was implemented to ensure that the company establishes an effective and strong command over all its business transactions and holds all its key appointments.
Several other changes made in the Company Registration Service in Hong Kong have made it simpler for the companies to establish an effective and viable company. First, the Companies House introduced a new simplified procedure for the company formation of limited liability. The new minor company formation procedure is easier and more convenient for the clients. It requires only two witnesses that are unrelated to the principal. Moreover, the new company formation procedure for limited liability allows the company to be registered under its name or the principal’s name. The company may also choose to register under its initials in place of the initials of the principal.
Most importantly, there was a significant revision of the Companies House rules on company formation services in Hong Kong. The new rules require the company to have at least one director and a manager. Additionally, the company formation service providers must post their contact information at the Secretary of State’s office. Previously, the company formation service providers had to disclose this information to the company secretary or the company registry. Therefore, the clients were not informed of these essential facts.
Besides, the new rules require the company formation services in Hong Kong to post the director’s remuneration and the business expenses on their respective websites. Previously, there were no restrictions on the advertising the company would use. However, the company had to inform all shareholders and potential investors of their financial information. The new regulations state that if a company does not have any direct or indirect shareholders, it must not disclose its status. Previously, the company secretary had to check this information manually to ensure that the company is not a sham.
Currently, there are new rules that require the company formation services in Hong Kong to submit audited accounts yearly. It is because many companies tend to exaggerate their profit and loss figures. They, therefore, do not have an accurate picture of their proper performance. Therefore, there is a need for the companies to submit the accounts so that the regulators can scrutinize them.
Finally, the new law requires all the company formation services in Hong Kong to post their contact information on the company registration website. Previously, they had to provide phone numbers and even e-mail addresses. Therefore, the clients were not informed about important contact information. Now, only the company secretary or a director can give out the information. The other information such as e-mails and telephone numbers can only be given to the clients after the company registration has been processed.