What are the conditions for establishing a limited company? Frequently asked questions
The establishment of a limited company has many advantages. In addition to having a better brand image, it can also protect the private property of shareholders.
In Hong Kong, more than 100,000 limited companies are established every year. If you want to set up a limited company, you can refer to the following limited company information.
Conditions for establishing a limited company?
If you want to start a business and establish a limited company in Hong Kong, it will be regulated by the Government’s Companies Ordinance (Chapter 622).
Applicants for the new limited company must be a Chinese resident with a passport or ID card, or an overseas person.
The applicant must be at least 18 years old, non-bankrupt, and become a shareholder and director of the company.
When establishing a limited company, the applicant must provide a Hong Kong address as the registered address, and appoint a Hong Kong resident or a company legal person as the company’s legal secretary.
How to set up a limited company?
1) Choose the company name
To start a business is to establish a company, and to establish a company is to name the company.
For the formulation of company names, please refer to the “Guidelines for the Registration of Hong Kong Company Names” of this department, and go to the Public Search Center on the 13th floor of the Government Offices or the Online Search Center to check whether the company name is in the “Company Name Index” for free Be registered.
2) Choose the company category
Secondly, a limited company can also be subdivided into a “company limited by shares” and a “limited company by guarantee”. The two are as follows:
“Company limited by shares”: According to the company’s articles of association, the legal liabilities of all members of the company are limited to the unpaid amount of the shares held by them.
“Company limited by guarantee”: In accordance with the company’s articles of association, the legal liabilities of all members of the company are limited to the amount of assets they have promised to pay for the company once it is wound up, and the company has no share capital.
Generally, non-profit organizations will register a “limited company by guarantee”.
3) Fill in the application form
After that, applicants can go to the collection counter on the 14th floor of the Government Offices in person, or through the “e-Registry” or “CR Exchange” mobile applications, to submit documents and fees, including the incorporation form (NNC1/ NNC1G), the company’s articles of association, and a notice to the Business Registration Office (IRBR1), then the application can be completed.
4) Receiving the certificate
At the end of the application process, the applicant will usually be issued an electronic version of the “Company Registration Certificate” and “Business Registration Certificate” within one day.
Articles of Association?
The establishment of a limited company needs to specify the “Articles of Association”, based on the two types of “Company Limited by Shares” and “Company Limited by Guarantee”. Those in need can refer to the template of the “Company (Model Articles of Association) Announcement” on the website of the Companies Registry if necessary. .
When drafting the articles of association for a limited company, the following items must be specified:
- Company Name;
- Company purpose
- The legal responsibilities of the members of the company;
- A company limited by shares must state the shares held by its members and the amount of unpaid funds;
- A company limited by shares must state the share capital and initial shareholding status;
- A company limited by guarantee must state the per capita commitments of its members during the company’s liquidation period;
Equity?
According to the Companies Ordinance, there is no restriction on the amount of share capital of a joint-stock company. The person in charge of the company can determine the amount of its share capital according to the actual needs of his business, and the promoter must subscribe for at least one share at the time of registration.
In the articles of association, the amount of share capital must be indicated for the joint-stock company, and the expression can be in any currency other than the Hong Kong dollar.
However, if the company operates a business that requires additional licenses, it needs to comply with the capital requirements of such licenses.
If it is a company that provides financial services, you need to consider the provisions on equity in the Securities and Futures Ordinance.
If a private limited company is established, there must be at least one shareholder, one director, and one company secretary. There is no restriction on the nationality of shareholders and directors. As investors in the establishment of a company, shareholders can act as directors or secretaries.
It should be noted that once the company has only one director, that director cannot serve as secretary at the same time.
Directors are generally elected by the general meeting of shareholders by voting, and the directors need to be the decision-makers of the company’s affairs and the board of directors.
As for the company secretary, he/she must be resident in Hong Kong. If it is a corporate secretary, its office must also be in Hong Kong to ensure that he/she can perform the company’s legal and administrative duties.
If the company has only one person, you can choose to appoint a reserve director as the replacement for the sole director to leave the company due to his death.
The above information is for reference only. If you have any questions about the establishment of a limited company, we welcome your inquiries.