Hong Kong introduces one-stop company registration

Hong Kong’s Companies Registry and the Inland Revenue Department (IRD) jointly launched a new regime of one-stop company and business registration, together with a one-stop notification of change of company particulars, with effect from 21 February 2011.

Under the new regime, the Registry will process the simultaneous business registration applications and notify IRD of changes of the relevant company particulars.

Any person who submits an incorporation form of a local company, or an application form for registration of a non-Hong Kong company, will be deemed to make a business registration application at the same time. Therefore, under this new registration regime, companies will only require to lodge one single application for both company and business registration.

The new registration regime applies to both paper and electronic applications. Upon the approval of the application, the Registry will issue a Certificate of Incorporation together with a Business Registration Certificate to the applicant.

For applications lodged through the e-incorporation service at the “e-Registry”, if approved, the Registry will issue both Certificate of Incorporation and Business Registration Certificate in the form of electronic records. Any request for the issue of the certificates in paper will not be entertained.

The new registration regime will not be applicable to application for business registration by other types of businesses such as sole proprietorship, partnership businesses and branch registration. These should be lodged directly with the Business Registration Office, as previously.

Last year, the Companies Registry posted a record high of almost 140,000 local companies, an increase of 27.5% over the registrations seen in 2009. By the end of last year, the total number of live local companies registered under the Companies Ordinance was 863,762, up more than 91,500 from that in 2009. The total number of non-Hong Kong companies that had established a place of business stood at 8,165 at the end of the year.

Hong Kong’s new Companies Bill has been gazetted and was introduced into the Legislative Council for its first reading on 26 January 2011.

The Secretary for Financial Services and the Treasury, Professor K C Chan, said: "The Companies Bill aims to achieve four main objectives, namely, enhancing corporate governance, ensuring better regulation, facilitating business and modernising the law. Rewriting the Companies Ordinance (CO) allows us to leverage the developments regarding company law in other comparable jurisdictions and enhance our competitiveness. We look forward to enactment of the Bill in the 2011-12 legislative session."

The rewrite of the CO started in mid-2006, and three public consultations were conducted to gauge views on a number of complex subjects. Some of the measures introduced by the Bill to enhance corporate governance include: improving the accountability of directors to enhance transparency and accountability, and clarifying the directors’ duty of care, skill and diligence; emphasising shareholder engagement in the decision-making process; improving the disclosure of company information; and strengthening auditors’ rights.