What are the duties of a Company Secretary in Hong Kong?

Company Secretary

By law, it is mandatory for each company to have a Company Secretary in Hong Kong. The company secretary must be a Hong Kong resident or a body corporate having its registered office or place of business in Hong Kong.

The main duties of a Company Secretary include maintaining statutory books, filing statutory returns with the Companies Registry and arranging for annual general meetings as required by law. Under the Companies Ordinance, penalties may be imposed on a company and its officers for failure to comply with certain procedural requirements within the prescribed period. It is therefore important that a professional Company Secretary is retained to oversee these procedural matters to ensure compliance matters.

Our Annual Company Secretarial Package includes:

• Acting as your Company Secretary
• Preparing annual return and filing with the Companies Registry
• Updating statutory books
• General consultation regarding company secretarial matters

If your company is already registered, you can appoint us as company secretary to benefit from our digital corporate services. We will liaise with your current company secretary to ensure a smooth transition.

How to open a Bank Account in Hong Kong?

Bank Account Opening

Opening a bank account in Hong Kong is necessary to run your business. We collaborate closely with DBS, HSBC, Standard Chartered, Bank of China, Hang Seng Bank in Hong Kong as well as with some digital banks.

Our service consists of the selection of the appropriate bank, the presentation of all requested information for due diligence and KYC procedure, supportive documents and a detailed explanation of the project to the banker(s), in order to obtain a pre-approval of processing and the organization of the meeting for the signature of bank forms by authorized signatorie(s) and UBO(s) and to get the account operational.

The whole process to open a bank account in Hong Kong usually takes around 3 weeks.

Lately, it has become really difficult for newly registered companies in Hong Kong without any substance (no real activity or staff in Hong Kong) to open a bank account in Hong Kong. If you are in this situation, we can assist with the opening of a bank account in Singapore for your Hong Kong company.

Minutes of Board of Directors

It is essential that company directors organize regular board meetings and record important business decisions, progress and future plans as a referent point.

Conveners of meetings of directors must refer to the company’s articles of association for the rules governing board meetings.

Recording board meeting minutes using a specified format also serves as legal protection as the board of directors have legal and fiduciary duties.

When selling a company or raising funds, a well-organized set of regular minutes detailing the strategy and main decisions taken during the course of business will help passing the due diligence.

Annual General Meeting

Subject to exceptions such as being a dormant company, every company must hold an Annual General Meeting (AGM) within a prescribed period. In determining the date of an AGM, reference must be made to Section 610 of the Companies Ordinance which prescribes the period during which an AGM must be held.

The agenda of an AGM usually consists of the following topics:

• Consideration of the audited accounts and reports of the directors and auditors;
• Declaration of dividends;
• Election of directors in place of those retiring, if any, and the fixing of their remuneration; and
• Appointment of auditors and the fixing of their remuneration

Extraordinary General Shareholders’ Meeting

By law, there are two types of shareholders’ resolutions: an ordinary resolution and a special resolution. The ordinary resolutions are the decisions made in any shareholders’ meeting unless the law specifies that such decision requires a special resolution. The ordinary resolutions are taken at the simple majority of votes (more than half of the votes) unless specified otherwise in the Articles of Association of the company.

The following matters must be approved by a special resolution, and the memorandum and articles of association cannot provide to the contrary:

• Alteration of objects clauses;
• Alteration of the articles of association;
• Alteration of the company’s name;
• Increasing the capital by issuing new shares;
• Reduction of the company’s share capital supported by solvency statement;
• Declaring that the company will become dormant;
• Dissolving the company;
• Merging the company

The special resolutions are taken at the qualified majority of votes (more than three-fourths of the votes).

The notice period for calling a general meeting of a limited company (regardless of whether an ordinary or a special resolution is proposed at such meeting) or a meeting for the passing of resolutions requiring special notice has been shortened to 14 clear days (the notice period for calling an AGM is 21 clear days).

How to change the shareholders in Hong Kong?

Change of the Company’s Shareholders Structure

By law, a Hong Kong private company limited by shares will require a minimum of one shareholder but no more than 50 shareholders.

If a shareholder intends to transfer his shares to a third party, he would need to sign a share transfer instrument and inform the company’s board of directors of such transfer. The authorized director would then be responsible to register the updated shareholders list with details of the new shareholders, update the share registrar book of the company and issue a new certificate of shares.

If the Articles of Association of the company or a Shareholders’ Agreement requires an existing shareholder to offer his shares first to the other shareholders (right of first refusal), then the other shareholders must be notified prior to proceeding to any share transfer.

If the share transfer comes with specific conditions or is part of the sale of the company, the parties would enter into a Share Purchase Agreement (SPA).

If the company wishes to raise funds from an investor, one of the existing shareholders must transfer at least one share to the investor for him to become a shareholder of the company and be able to participate in the capital increase.

How to change directors in Hong Kong?

Change of the Company’s Board of Directors

By law, the change in the board of directors (add a new director, remove a director or replace a director) requires a resolution in a shareholders’ meeting except when the Articles of Association specify that such change can be made by the board of directors.

Section 462 of the Companies Ordinance provides that a special notice is required for a proposed resolution to remove a director or appoint somebody in place of a director and must be given at least 28 days before the relevant general meeting.

Once the meeting is held, the change in board of directors must be registered with the Companies Registry within 15 days from the meeting date. The existing (or former) director(s) of the company and the new directors(s) would be required to sign documents.

The dismissal of a director from the board may be due to the (i) completion of the term, (ii) a resolution of the shareholders’ meeting or (iii) a resignation of the director.

How to change the registered address of a company in Hong Kong?

Change of the Company’s Registered Address

Companies are required to have a local registered address in Hong Kong where the company folder, statutory documents are kept. It is usually the address of the appointed company secretary, but it could be your office in Hong Kong.

The change of a company registered address must be notified to several government authorities including the Inland Revenue Department, the Companies Registry and the MPF Service Provider as the case may be. The new registered address will also need to be updated with the banks, the work permits and other relevant licenses that the company holds. A detailed list of documents and the landlord permission are required for each step.

Change of the Company’s Name

The name of a company can be changed by the passing of a special resolution subject to the approval of the Companies Registry.

Every limited company in Hong Kong would need to have a unique and appropriate name as per the criteria set by the Companies Registry.

We can help you check the name of your new Hong Kong company, apply for changing the name of the company, collect Certificate of Name Change, update business registration certificate and place an order for company seal and chops with the new company name.

How to increase the capital of a Company in Hong Kong?

Change of the Company’s Registered Capital

Capital increase by allotment of shares

It is important to check the Articles of Association and Shareholders’ Agreement as those documents often specify special rules to follow to increase capital and issue new shares.

The company members shall pass a resolution to approve the allotment of shares to the new investor(s) or existing member(s). Such approval may be unconditional or subject to conditions set out in the terms and conditions of the contracts of allotment. The company members have a right to revoke or vary the approval of share allotment at any time by a company resolution.

Reduction of Share Capital

There are two methods of reduction of capital:

• reduction of share capital by special resolution by a solvency statement, i.e. a court-free capital reduction procedure
• reduction of share capital by special resolution confirmed by the Court

By comparison, the court-free procedure is a faster and cheaper method.

The court-free capital process requires that the proposed capital reduction must be approved by the directors of the company, each director must sign a solvency statement, within 15 days of the date of the solvency statement, the shareholders of the company must pass a special resolution approving the reduction of share capital and publish in the Gazette a notice of the reduction of capital within a specific period; and certain forms must be filed with the Companies Registry.

Any creditor or non-approving shareholder (other than one who consented to or voted in favour of the special resolution) of the relevant company may, within 5 weeks of the date of the special resolutions, apply to the court for cancellation of the resolutions.