[ESTABLISHING A BUSINESS ENTITY IN HONG KONG]
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major decisions requiring unanimous consent of all shareholders, and pre-emptive rights and tag-along rights in relation to transfer of shares. In case of breach of a shareholders’ agreement, the full range of ordinary contractual remedies are generally available. Further, while in general the proper plaintiff to seek legal redress for a wrongdoing to the company is the company itself, a range of legal remedies may be available to minority shareholders in case of abuse of powers or wrongdoings by the company’s directors or majority shareholders. They include statutory or common law derivative actions brought by a shareholder in the name and on behalf of the company for any misconduct against the company, personal actions for infringement of personal rights of a shareholder, and the unfair prejudice remedy under the Companies Ordinance where the company’s affairs are conducted in a manner (or an actual or proposed act or omission of the company is or would be) unfairly prejudicial to the interests of the members generally or of one or more members. In appropriate situations, an aggrieved shareholder may seek statutory injunctions or, as a last resort, apply for an order for the winding up of a company on just and equitable grounds. 3.2 Non-Hong Kong Company 3.2.1 Branch A non-Hong Kong company may carry on business in Hong Kong through a place of business in Hong Kong, commonly referred to as a “branch”. It is only an address at which the business is carried on and hence is not a separate legal entity from the non-Hong Kong company. Registration A non-Hong Kong company is required to be registered as a registered non-Hong Kong
company within one month after the establishment of the place of business in Hong Kong by delivering the following documents with the prescribed fee to the Companies Registry: (a) Application for Registration as Registered Non-Hong Kong Company; (b) a certified copy of the instrument defining the company’s constitution (e.g., charter, statutes or memorandum and articles of association); (c) a certified copy of the company’s certificate of incorporation; (d) a certified copy of the company’s latest published accounts; and (e) a Notice to the Business Registration Office. The One-stop Company and Business Registration Service is also applicable to the registration of a non-Hong Kong company under the Companies Ordinance. The Certificates of Registration of Non-Hong Kong Company and the Business Registration Certificates can normally be issued within 10 working days. Authorized Representative A registered non-Hong Kong company is required to appoint an authorized representative (which may be a natural person resident in Hong Kong, a solicitors’ firm, a CPA firm, etc.) to accept on the company’s behalf service of any process or notice required to be served on the company. Post-registration Compliance Requirements A registered non-Hong Kong company is subject to less extensive continuing obligations than a Hong Kong company. The basic compliance requirements also include, among other things, the filing of (i) an annual return for which an annual registration fee is payable every year;
ILN Corporate Group – Establishing a Business Entity Series
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