Filling Requirements of a Local Limited Company after Incorporation in Hong Kong
Hong Kong is known for being a unique business hub for starting up new corporate companies and one of the freest markets in the world. It is a perfect location for foreign investors to access the Chinese market because of its proximity to China, its similarity concerning social practices, language, culture, and its international business climate.
So, if you’re considering starting up a new business in Hong Kong, you may be packed with questions, such as how complicated the process of setting up a business is in Hong Kong. The first stage of doing business in a free market like Hong Kong is the registration of a Hong Kong corporation and the basis for operating a business.
Every local limited company and its officers shall, in full accordance with the provisions of the Companies Ordinance, ensure prompt delivery of legislative returns to the Registrar of Companies (the Registrar) for registration (CO). If a company fails to meet with the CO’s conditions, it is liable for litigation and if prosecuted, default penalties for the company and any responsible person of the company, including every director, business secretary, and manager of the company.
The essential for the understanding set out the main regulatory returns to be delivered to the Companies Register by a local limited partnership for registration after incorporation
Table of contents
- NAR1 Annual Return (sections 662 & 664)
- NR1 Notice of Change of Address of Registered Office (section 658)
- ND2A Notice of Change of Company Secretary and Director (Appointment / Cessation) (sections 645 & 652)
- ND2B Notice of Change in Particulars of Company Secretary and Director (sections 645 & 652)
- NSC1 Return of Allotment (section 142)
NAR1 Annual Return (sections 662 & 664)
For a private entity, the company has to deliver within 42 days of the anniversary of every year’s date of incorporation.
For a public corporation, if the financial year starts before 3 March, the company must deliver within 42 days of the date of the annual general meeting of the company.
In the case of a public company, if the financial year starts on or after 3 March, the company must deliver within 42 days after the return date of the company i.e. 6 months after the close of the accounting reference period of the company.
In the case of a company limited by guarantee, if the financial year starts before 3 March 2014, it must be delivered within 42 days of the date of the annual general meeting of the company.
In the case of a company limited by guarantee, if the financial year starts on or after 3 March, the company must provide within 42 days of the return date of the company i.e. 9 months of the close of the accounting reference period of the company.
Important Points to remember
- There is a payable annual registration fee
- For late issuance of an annual return, a significantly higher registration fee (ranging from HK$870 to HK$3,480 for private corporations and companies limited by guarantee (Note 5) and from HK$1,200 to HK$4,800 for public companies) is due
- Under the Company Registration Ordinance enforced by the Inland Revenue Department’s Business Registration Office, business registration and its renewal are statutory requirements. You are also expected under the CO, even though you have renewed your company registration, to deliver your annual report along with the annual registration fee to the Registrar of Companies within the specified period.
- The annual return shall NOT be considered to have been delivered to the Registrar following the reporting standards if the annual return is delivered by post unless it has been received by the Registrar
- The cumulative punishment for each violation, along with a regular default fine of HK$1,000, is HK$50,000 if the default is made in the delivery of annual returns for registration.
- The ‘Annual Return e-Reminder’ program is available to approved users at the e-Registry (www.eregistry.gov.hk) to obtain email reminders of annual return deliveries.
NR1 Notice of Change of Address of Registered Office (section 658)
The company has to deliver the notice within 15 days after the change.
Important points to remember:
- An organization must have a registered office in Hong Kong to which all notices and communications must be sent.
- A business must ensure that notice of change of address is given within the specified period to the Registrar for registration. The maximum punishment for each violation is HK$50,000, along with a regular default fine of HK$1,000 for a continuous offense, if the default is made in presenting the notice for registration.
ND2A Notice of Change of Company Secretary and Director (Appointment / Cessation) (sections 645 & 652)
The company has to deliver the notice within 15 days after the appointment or cessation
ND2B Notice of Change in Particulars of Company Secretary and Director (sections 645 & 652)
The company has to deliver the notice within 15 days after the change in particulars.
Important points to remember:
- At least one director who is a natural person and one company secretary must have a private company. The sole director cannot be the company’s company secretary
- A public company and a guarantee-limited company must have at least two directors and one secretary of the company. A corporate entity cannot be appointed as the company’s director.
- The secretary of the company, in the case of a natural person, must normally reside in Hong Kong; or the case of a corporate entity must have a registered office or a place of business in Hong Kong.
- A company must provide a Form ND2A containing a statement of consent to each newly named director for registration to serve as a director.
- If the notices are delivered by mistake, the maximum punishment for each violation is HK$25,000, along with a regular default fine of HK$700.
- Published by the Companies Register, all directors are recommended to read “A Guide on Directors’ Duties.”
NSC1 Return of Allotment (section 142)
The company has to deliver the notice within one month after an allotment of shares.
Important points to remember:
- A corporation shall provide the registrar with a return of the allotment for incorporation in the prescribed form, including information such as particulars of the allocated shares, complete allotment, etc
- The Type NSC1 provides a declaration of capital that is a snapshot of the latest share capital of a firm.
- If the returns are delivered by default, the maximum penalty for each violation is HK$25,000, along with a regular default fine of HK$700.
You can download specified forms at www.cr.gov.hk or purchase hard copies on the 14th floor, Queensway Government Offices, 66 Queensway, Hong Kong
Documents containing fees must be submitted to the List of Companies with the right fees.
Any application not followed by the proper fee payable for registration shall be deemed to be unsatisfactory and the Registrar may fail to approve the document or refuse to register it. Higher filing payments would be required in the case of late issuance of annual returns.
For annual returns delivered according to section 662 of the CO.
Directors should acquaint themselves with the general duties of directors outlined in “A Guide on Directors’ Duties” (the Guide). Companies should provide copies of the Guide to their directors for information and reference