Hong Kong’s Financial Services and Treasury Bureau (FSTB) has announced the launch of the second phase of public consultation on the provisions of the Hong Kong Companies Bill as part of its ongoing effort to reform the Hong Kong company law.
In order to make Hong Kong company law more business-friendly, the government has launched a comprehensive effort to rewrite the Companies Ordinance. In this regard, the Companies (Amendment) Bill 2010 and the Business Registration (Amendment) Bill 2010 were gazetted in January 2010. While the Companies Bill aims at enhancing company formation in Hong Kong, the Business Registration Bill will help in implementing a one-stop service for company incorporation (with the Companies Registry) and business registration (with the Inland Revenue Department). The new measures will help entrepreneurs with Hong Kong company registration within one working day and simplify the regulatory regime for Hong Kong companies 香港註冊公司.
The first phase of public consultation on the Companies Bill ended in March 2010 and covered corporate governance matters and regulatory compliance. The second phase of public consultation deals with business facilitation such as enforcing simplified accounting requirements for private companies and small guarantee companies, streamlining financial assistance provisions, introducing a solvency test for the reduction of share capital, allowing electronic communication between a company and its members, enabling scrip-less holding and trading of shares and debentures, etc.
At present, it takes around 4-7 working days to incorporate a company in Hong Kong. With the new legislation in place, the Hong Kong company incorporation process can be completed within one working day, which is the current norm for its main competitor Singapore. The e-system will help businesses save on time, cost and resources. Hong Kong’s technology drive and company law reform will improve business processes and enhance Hong Kong’s attractiveness as a regional business hub.