In August 2013, Vistra issued a bulletin to its clients introducing the passage of the new Hong Kong Companies Ordinance and a summary of the major reforms that were passed into law by the Hong Kong Legislative Council in July 2012. The new aspects of the Ordinance become effective on 3rd March 2014 and are worth a timely refresher.
The most obvious change to the new Ordinance is the requirement of having at least one natural person as a director for all private companies that are incorporated from the 3 rd March 2014 onwards. For those companies that have been incorporated prior to this date, a 6 month "grace period" will be applied to allow companies time to adjust and become compliant with the new Ordinance. Importantly, this change does not abolish the use of Corporate Directors in Hong Kong, however, the new Ordinance is clear that at least one natural person must be appointed as a director to a private company in addition to any other Corporate Directors being employed for such purpose. Furthermore, unlike the case in Singapore, the new Ordinance does not specify that such a natural person appointed as Director must be resident in Hong Kong in any way. While increasing accountability and transparency, therefore, a great deal of flexibility has still been accommodated.
Concerns remain over the privacy of personal data with respect to the protection of a director's residential address and his/her identification number. While the new Ordinance states that a director is now required to provide both a correspondence address in addition to the usual residential address (and the correspondence address rather than the residential address shall be on public record) and only partial identification number will be made available on the Companies Register for public inspection, these changes have yet to come into force. Therefore, a director's residential address, which must be reported, and his/her full identification number will be a matter of public record until such changes become effective.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.