Hong Kong Company Legal Representative
The person holds, directly or indirectly, more than 25% of the issued shares of the company or, if the company has no share capital, he holds directly or indirectly the right to participate in more than 25% of the capital or profits of the company; Basic requirements and selection of a legal representative PRC company law does not impose any restrictions on the nationality of the legal representative, and the selected person could actually reside in a country. nor is he obliged to reside in China. According to the Companies Act, the legal representative may be the Chairman of the Board of Directors, the Managing Director (if there is no Board of Directors) or the Managing Director. However, the choice of legal representative varies depending on the structure of the company. For this reason, it could be a mistake to ask to contact the legal representative or to request their participation in your communication with the Company. Chops In China, every company must have a “chop” that is in the custody of the legal representative. Chop control is important to minimize risk. Legal representative hacking is required on many company documents and is considered a signature. In this sense, the legal representative plays a very important role in the day-to-day affairs of the company. Accordingly, any person in possession of the legal representative`s chop may exercise his or her power to bind the company.
To prevent unauthorized use, companies should restrict access to the legal representative`s chop by keeping records of who, when and for what purpose the chop was used. Limited liability companies have their own legal personality, limited liability for their owners, a strong public perception and a sustainable structure; Raising capital and transferring ownership is easier than other business structures such as sole proprietorships and partnerships. Foreign businessmen often refer to these types of companies as offshore companies in Hong Kong. Since 1 March 2018, companies domiciled in Hong Kong must keep a register of significant auditors and appoint at least one person as a designated representative to assist the company in relation to this register (Section 653ZC of the Companies Ordinance). No, a company registered outside Hong Kong is not required to keep a register of significant auditors. A single local company which, in accordance with the Companies Ordinance (Cap. 622) or a previous regulation on companies, with the exception of a listed company, is required to keep a register of significant auditors. The company should also consider reporting the case to the commercial register if the addressee of the notification does not meet the conditions set out in the notifications. The Company shall add a note in its Register of Significant Controllers that the Company has notified a person whom it knows or has reason to believe is a registrable person or a registrable legal entity of the Company, but that such person has not complied with the notification within the specified period of 1 month.
See examples of additional questions to be considered in the register. When registering a company in China, it is necessary for the company to appoint persons to fulfill the roles of the company`s legal structure (hereinafter also referred to as “WFOE”). This article explains the duties and responsibilities associated with each position. If you do not have access to the business license of a Chinese company or want to confirm the information displayed (i.e. Not False), you can view the company`s public registration dossier online. At the time of registration for the branch, it is necessary to remove the sector of activity of the company, the name of its legal representative. How do you determine the scope of the business? If there is a change, how can you change it? Who can act as the legal representative of the company? Article 20 of the Companies Act provides: The scope of the company`s activities is clearly defined in the articles of association and registered by law. Companies can change the scope, but they must register these changes. Company law states that if there is a change, but the company does not record the change based on that change; The company does not register within the deadline, a fine of more than 10,000 RMB but less than 100,000 RMB will be imposed. In order to persuade a court or arbitral tribunal to indemnify a company from liability for unauthorized contract or other act of its legal representative, the company must generally demonstrate that it has made reasonable efforts to define, implement, register and disclose the powers of its legal representative. However, this is often not the case. The legal representative of the Chinese company may be any person of the company.
They were chosen to put their name on the commercial license and accepted this agreement. The appointed representative of a company must be either a shareholder, director or employee of the company who is a natural person resident in Hong Kong or, alternatively, a chartered accountant, a lawyer or a person authorised to carry on business as a trustee or business service provider. Stay ahead of the curve in emerging Asia. Our subscription service provides regular regulatory updates, including the latest legal, tax and accounting changes that impact your business. The supervisor has the authority to supervise the duties and actions of directors and officers. If any of their actions harm the company, the supervisor is required to correct it. In case of violation of laws, bylaws or articles of association that may cause losses to the company, the supervisor can open an investigation and even take legal action against the company. Legal representatives are subject to a higher level of diligence and skill under Chinese law than other employees and can be held civilly, administratively and even criminally liable for illegal acts – both for the company and for their own.
As a result, the legal representative may be subject to fines and penalties accumulated by the Company and, above all, the responsibilities of a legal representative extend to bankruptcy. The designated representative of a Company must be either (i) a director, employee or member of the Company who is a person resident in Hong Kong, or (ii) a chartered accountant, lawyer or person authorized to run a trust or business services business (“a TCSP licensee”). If you are an employee of the holding company, you may be designated as the designated representative of the holding company. If you are not a director, employee or member of the other affiliates, you must meet the above condition (ii) before you can be appointed as the designated representative of those companies. In other words, you may be appointed as a designated representative for all other group companies if you are a chartered accountant, lawyer or TCSP licensee. On the AIC website, you can search for a company`s public registration dossier using its registered Chinese name. The amendments to the Law on Joint Stock Companies of the PRC require that a new company established on or after 1 January 2006, depending on the size of the company, appoint a supervisor or supervisory board to supervise the activities of the legal representative. The shareholders and employee representatives of a company may act as supervisors. However, the members of the board of directors or management of the company may not act at the same time as supervisors. If a company has a supervisory board, it must have a proportion of employee representatives representing at least one third of the members of the supervisory board.
The supervisor, like the directors of the company, does not need to live or visit China. In order to form a limited liability company in Hong Kong, the following documents are usually required: A person who directly or indirectly holds more than 25% of the issued shares of the company is a significant controller.