Hong Kong Companies Ordinance Cap 622
What is Company Ordinance Cap 622?
Hong Kong Companies Ordinance Cap 622 (the new Companies Ordinance, or the new CO) consists of 921 sections and 11 schedules.
Cap 622 of the Companies Ordinance is a legal framework for the incorporation and operation of companies in Hong Kong.
Hong Kong Companies Ordinance Cap 622 modernises the HK company law and enhances the status of HK as a major international business and financial centre.
Cap 622 has commenced operation on 3 March 2014 in Hong Kong.
Four Main Objectives of HK Companies Ordinance Cap 622
The four main objective of the Companies Ordinance Cap 622 are to:
- Enhance corporate governance
- Ensure better regulation
- Facilitate business
- Modernise the law
Measures for enhancing corporate governance, includes:
- Strengthening the Accountability of Directors
- Enhancing Shareholder Engagement in the Decision-Making Process
- Improving the Disclosure of Company Information
- Fostering Shareholder Protection
- Strengthening Auditors’ Rights
Measures for ensuring better regulation, includes:
- Ensuring the Accuracy of Information on the Public Register
- Improving the Registration of Charges
- Refining the Scheme for Deregistration of Companies
- Improving the Enforcement Regime
Measures for facilitating business, includes:
- Streamlining Procedures
- Facilitating Simplified Reporting
- Facilitating Business Operations
Measures for modernising the law, includes:
- Rewriting the Law in Simple and Plain Language
- Abolishing Par Value for Shares
- Abolishing Memorandum of Association
- Removing the Power to Issue Share Warrants
- Clarifying the Rules on Indemnification of Directors against Liabilities to Third Parties
The Twenty-one Parts of Companies Ordinance Cap 622
The Companies Ordinance Cap 622 of Hong Kong is divided into 21 parts:
- Part 1: Preliminary
- Part 2: Registrar of Companies and Companies Register
- Part 3: Company Formation and Related Matters, and Re-registration of Company
- Part 4: Share Capital
- Part 5: Transactions in relation to Share Capital
- Part 6: Distribution of Profits and Assets
- Part 7: Debentures
- Part 8: Registration of Charges
- Part 9: Accounts and Audit
- Part 10: Directors and Company Secretaries
- Part 11: Fair Dealing by Directors
- Part 12: Company Administration and Procedure
- Part 13: Arrangements, Amalgamation, and Compulsory Share Acquisition in Takeover and Share Buy-Back
- Part 14: Remedies for Protection of Companies’ or Members’ Interests
- Part 15: Dissolution by Striking Off or De-registration
- Part 16: Non-Hong Kong Companies
- Part 17: Companies Not Formed, but Registrable, under this Ordinance
- Part 18: Communications to and by Companies
- Part 19: Investigations and Enquiries
- Part 20: Miscellaneous
- Part 21: Consequential Amendments, and Transitional and Saving Provisions
From Cap 32 to Cap 622
Cap 32 was the old Companies Ordinance before the implementation of the new CO (i.e. Companies Ordinance of HK).
Hong Kong Companies Ordinance Cap 622 was a comprehensive rewrite of the Companies Ordinance Cap 32. The rewrite of the HK Companies Ordinance started in the middle of 2006, and went through five rounds of public consultations and several discussions a series of public forums and seminars.
In February 2011, a Bills Committee was formed whose responsibility was to scrutinise the Bill. It has taken 44 meetings (which lasted over 120 hours), and consideration of more 200 papers or submissions.
In June 2012, the Bills Committee completed the scrutiny of the Bill.
On 12 July 2012, the Companies Bill was passed by the the Legislative Council (or LegCo).
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