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香港新会社条例(第622章) 101~200条

1-100 101-200 201-300 301-400 401-500 501-600 601-700 701-800 801-900 901-921 Schedule

Section:

101

Financial Secretary may specify word or expression for section 100(2)(b)

The Financial Secretary may, by order published in the Gazette, specify any word or expression for the purposes of section 100(2)(b).

Subdivision:2

Limited Company Name with “Limited” as Last Word etc.

Section:

102

Limited company must not be registered without “Limited” as last word of name etc.

A limited company must not be registered by
  (a) if the company has an English name only, a name without Limitedas the last word of the name;
  (b) if the company has a Chinese name only, a name without 有限公司as the last 4 characters of the
name; or
  (c) if the company has both an English name and a Chinese name
    (i) an English name without Limitedas the last word of the name; and
    (ii) a Chinese name without 有限公司as the last 4 characters of the name.

Section:

103

Registrar’s licence to dispense with “Limited” etc.

(1) The Registrar may exercise the power under subsection (2) in respect of an association intended to be formed as a limited company, if it is proved to the Registrar's satisfaction that
  (a) the company is to be formed for promoting commerce, art, science, religion or charity or any other useful objects;
  (b) the association intends to apply the company's profits or other income in promoting its objects; and
  (c) the association intends to prohibit the payment of dividends to the company's members.

(2) The Registrar may, by licence, permit the association to be registered as a limited company by
  (a) if the company has an English name only, a name without Limitedas the last word of the name;
  (b) if the company has a Chinese name only, a name without 有限公司as the last 4 characters of the name; or
  (c) if the company has both an English name and a Chinese name
    (i) an English name without Limitedas the last word of the name; and
    (ii) a Chinese name without 有限公司as the last 4 characters of the name.

(3) The Registrar may exercise the power under subsection (4) in respect of a limited company, if it is proved to the Registrar's satisfaction that
  (a) the objects of the company are restricted to
    (i) promoting commerce, art, science, religion or charity or any other useful objects; and
    (ii) objects incidental or conducive to the objects mentioned in subparagraph (i);
  (b) the company is required by its articles to apply its profits or other income in promoting its objects; and
  (c) the company is prohibited by its articles from paying dividends to its members.

(4) The Registrar may, by licence, permit the limited company to
  (a) if the company has an English name only, change the name to delete from it the word Limited;
  (b) if the company has a Chinese name only, change the name to delete from it the characters 有限公司; or
  (c) if the company has both an English name and a Chinese name
    (i) change the English name to delete from it the word Limited; and
    (ii) change the Chinese name to delete from it the characters 有限公司.

(5) A change of company name under a licence mentioned in subsection (4) may only be made by special resolution, and section 107(2), (3), (4), (5) and (6) applies to such a change as it applies to a change of company name under section 107.

(6) To avoid doubt, a company registered by a name under a licence granted under this section
  (a) has the privileges of a limited company; and
  (b) subject to section 105(1), has the obligations of a limited company.

Section:

104

Terms and conditions of licence

(1) A licence under section 103 may be granted on any terms and conditions the Registrar thinks fit.

(2) The terms and conditions
  (a) are binding on the company; and
  (b) are to be incorporated in the articles of the company if the Registrar so directs.

Section:

105

Effect of licence

(1) The company to which a licence under section 103 relates is exempt from
  (a) section 102;
  (b) regulations made under section 659 in relation to the use of the word Limitedas part of its English name or use of the characters “有限公司” as part of its Chinese name; and
  (c) section 662 in relation to the delivery of particulars relating to members to the Registrar.

(2) While a licence under section 103 remains in force, the company must not alter its articles except under a direction given under this section or section 104(2)(b) or with the Registrar's prior written approval.

(3) On granting an approval under subsection (2), the Registrar may vary the licence by making it subject to any terms and conditions he or she thinks fit, in addition to or in place of the terms or conditions to which the licence was subject immediately before the variation.

(4) The terms and conditions imposed under subsection (3)
  (a) are binding on the company; and
  (b) are to be incorporated in the articles of the company if the Registrar so directs.

Section:

106

Revocation of licence

(1) The Registrar may at any time revoke a licence granted under section 103 on being satisfied that
  (a) the company has failed to comply with any of the terms or conditions to which the licence is subject; or
  (b) any one or more of the requirements specified in section 103(1) or (3) (as the case may be) are no longer met.

(2) Before revoking a licence, the Registrar
  (a) must notify the company in writing of the Registrar's intention to do so; and
  (b) must give the company an opportunity to be heard.

(3) If a licence is revoked, the Registrar must give the company a notice in writing of the revocation.

(4) On the revocation of a licence, the company ceases to be entitled to the exemptions mentioned in section 105(1).

(5) Within the period specified in the notice of revocation, the company must change its name by special resolution to
  (a) if the company has an English name only, add Limitedas the last word of the name;
  (b) if the company has a Chinese name only, add “有限公司” as the last 4 characters of the name; and
  (c) if the company has both an English name and a Chinese name
    (i) add Limitedas the last word of the English name; and
    (ii) add “有限公司” as the last 4 characters of the Chinese name.

(6) Section 107(2), (3), (4), (5) and (6) applies to a change of company name under subsection (5) as it applies to a change of company name under section 107.

(7) If the company fails to comply with subsection (5), the Registrar must in the Companies Register
  (a) if the company has an English name only, add Limitedas the last word of the name;
  (b) if the company has a Chinese name only, add “有限公司” as the last 4 characters of the name; and
  (c) if the company has both an English name and a Chinese name
    (i) add Limitedas the last word of the English name; and
    (ii) add “有限公司” as the last 4 characters of the Chinese name.

Subdivision:3

Change of Company Name

Section:

107

Company may change name by special resolution

(1) A company may change a company name by special resolution.

(2) Within 15 days after the date of passing the special resolution, the company must deliver to the Registrar for registration a notice in the specified form of the change of company name.

(3) After receipt of a notice under subsection (2), the Registrar must, unless the new name is a name by which the company must not be registered under section 100
  (a) enter the new name in the Companies Register in place of the former name; and
  (b) issue to the company a certificate of change of name.

(4) The change of the name has effect from the date on which the certificate of change of name is issued.

(5) A change of name under this section does not affect any rights or obligations of the company or render defective any legal proceedings by or against it. Any legal proceedings that could have been commenced or continued by or against it by its former name may be commenced or continued by or against it by its new name.

(6) If a company contravenes subsection (2), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 3 and, in the case of a continuing offence, to a further fine of $300 for each day during which the offence continues.

Section:

108

Registrar may direct company to change same or similar name etc.

(1) The Registrar may by notice in writing direct a company to change, within the period specified in the notice, a name by which the company is registered under this Ordinance or the predecessor Ordinance if
  (a) the name is, as at the time of the registration, the same as or in the Registrar's opinion too like a name that appeared or should have appeared in the index of names kept under section 22C of the predecessor Ordinance or in the Index of Company Names;
  (b) the name is, as at the time of the registration, the same as or in the Registrar's opinion too like a name of a body corporate incorporated or established under an Ordinance;
  (c) it appears to the Registrar that misleading information has been given for the company's registration by the name;
  (d) it appears to the Registrar that any undertaking or assurance given for the registration by the name has not been fulfilled; or
  (e) the name is a name by which, as at the time of the registration, the company must not be registered because of section 100(2)(a) or (b).

(2) The Registrar may by notice in writing direct a company to change, within the period specified in the notice, a name by which the company is registered under this Ordinance or any former Companies Ordinance if, after the company is registered by the name
  (a) a court makes an order restraining the company from using the name or any part of the name; and
  (b) an office copy of the order, and a notice in the specified form, are delivered to the Registrar for registration by a person in whose favour the order is made.

(3) A direction may only be given
  (a) in the case of subsection (1)(a) or (b), within 12 months after the date of registration by the name; (b) in the case of subsection (1)(c) or (d), within 5 years after the date of registration by the name; and (c) in the case of subsection (1)(e), within 3 months after the date of registration by the name.

(4) The Registrar may, before the end of the period specified in a notice given under subsection (1) or (2), by notice in writing extend the period.

(5) If a company fails to comply with a direction within the period specified in the notice or, if the period is extended under subsection (4), within the extended period, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 6 and, in the case of a continuing offence, to a further fine of $2000 for each day during which the offence continues.

Section:

109

Registrar may direct company to change misleading or offensive name etc.

(1) The Registrar may by notice in writing direct a company to change a name by which the company is registered
under this Ordinance or any former Companies Ordinance if
  (a) the Registrar is of the opinion that the name gives so misleading an indication of the nature of the company's activities as to be likely to cause harm to the public; or
  (b) the name is a name by which, as at the time of the registration, the company must not be registered because of section 100(1)(c) or (d).

(2) The company must comply with a direction within the period of 6 weeks after the date of the direction or, if the period is extended under subsection (4), within the extended period.

(3) A company may, within 3 weeks after the date of a direction, appeal to the Administrative Appeals Board against the direction.

(4) The Registrar may, before the end of the period of 6 weeks after the date of the direction, by notice in writing extend the period.

(5) If a company contravenes subsection (2), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 6 and, in the case of a continuing offence, to a further fine of $2,000 for each day during which the offence continues.

Section:

110

Registrar may change company name in case of failure to comply with direction

(1) This section applies if—
  (a)the Registrar directs a company to change a name under section 108(1) or (2) or 109(1) or, on or after 10December 2010 under section 22 or 22A of the predecessor Ordinance; and
  (b)the company fails to comply with the direction—
    (i) in the case of a direction under section 108(1) or (2), within the period specified in the notice or, if the period is extended under section 108(4), within the extended period;
    (ii) in the case of a direction under section 109(1), within the relevant period specified in section 109(2);
    (iii) in the case of a direction under section 22(2), (3A), (3B) or (4) of the predecessor Ordinance, within the period specified by the Registrar or, if the period is extended under section 22(5) of that Ordinance, within the extended period; or
    (iv) in the case of a direction under section 22A(1) or
(1A) of the predecessor Ordinance, within the period specified in section 22A(2) of that Ordinance or, if a period is specified by the court under section 22A(3) of that Ordinance for the direction, within the period specified by the court.

(2) Without limiting section 108(5) or 109(5), or section 22(6) or 22A(4) of the predecessor Ordinance (as the case may be), the Registrar may change the name to
  (a) in the case of an English name, a name that consists of the words Company Registration Numberas its prefix, followed by the registration number of the company as stated in the certificate of incorporation;
  (b) in the case of a Chinese name, a name that consists of the characters 公司註冊編號as its prefix,
followed by the registration number of the company as stated in the certificate of incorporation; or
  (c) in the case of a name consisting of both an English name and a Chinese name
    (i) an English name that consists of the words Company Registration Numberas its prefix, followed by the registration number of the company as stated in the certificate of incorporation; and
    (ii) a Chinese name that consists of the characters “公司註冊編號” as its prefix, followed by the
registration number of the company as stated in the certificate of incorporation.

(3) The Registrar must enter the new name in the Companies Register in place of the former name.

(4) The change of name has effect from the date on which the new name is entered in the Companies Register.

(5) Within 30 days after the date of entering the new name in the Companies Register, the Registrar
  (a) must by notice in writing notify the company of
    (i) the fact that a name of the company has been changed; (ii) the new name; and
    (iii) the date on which the change takes effect under subsection (4); and
  (b) must by notice in the Gazette notify that fact, the new name and that date.

(6) A change of name under this section does not affect any rights or obligations of the company or render defective any legal proceedings by or against it. Any legal proceedings that could have been commenced or continued by or against it by its former name may be commenced or continued by or against it by its new name.

Subdivision:4

Supplementary Provision

Section:

111

Determining whether name is same as or similar to another name

(1) This section applies in determining
  (a) whether a name is the same as another name for the purposes of section 100(1)(a) or (b) or (2)(c) or 108(1)(a) or (b); or
  (b) whether a name is too like another name for the purposes of section 108(1)(a) or (b). (2) If the definite article is the first word of the name, the definite article must be disregarded.

(3) If any of the words, expressions or characters specified in subsection (4), or an abbreviation of any of them, appears at the end of the name, the word, expression, character or abbreviation must be disregarded.

(4) The words, expressions or characters are
  (a) company;
  (b) and company;
  (c) company limited;
  (d) and company limited;
  (e) limited;
  (f) unlimited;
  (g) public limited company;
  (h) “公司”;
    (i) “有限公司”;
  (j) “無限公司”;
  (k) “公眾有限公司”.

(5) The following must be disregarded
  (a) type or case of letters;
  (b) spaces between letters;
  (c) accent marks;
  (d) punctuation marks.

(6) The following expressions are to be regarded as the same
  (a) andand &;
  (b) Hong Kong, Hongkongand HK;
  (c) Far Eastand FE.

(7) A Chinese character is to be regarded as the same as another Chinese character if the Registrar is satisfied, having regard to the usage of the 2 characters in Hong Kong, that the 2 characters can reasonably be used interchangeably.

Division:4

Membership

Section:

112

Members of company

(1) A founder member of a company is to be regarded as having agreed to become a member of the company.

(2) On the registration of a company, a founder member of the company must be entered, as a member, in the company's register of members.

(3) Any other person who agrees to become a member of a company and whose name is entered, as a member, in the company's register of members is a member of the company.

Section:

113

Members of holding company

(1) Subject to this section
  (a) a body corporate cannot be a member of a company of which the body corporate is a subsidiary; and
  (b) any allotment or transfer of shares in a company to a body corporate that is a subsidiary of the company is void.

(2) Subsection (1) does not apply if
  (a) the body corporate is a member of the company as a personal representative; or
  (b) the body corporate is a member of the company as a trustee, and the holding company or any of its subsidiaries is not beneficially interested under the trust.

(3) For the purposes of subsection (2)(b), a company or subsidiary is not beneficially interested under a trust if it is interested under the trust only by way of security for the purpose of a transaction entered into by it in the ordinary course of a business (including the lending of money).

(4) Subsection (1) does not prevent a body corporate that was, on 31 August 1984, already a member of a holding company of the body corporate from continuing to be such a member.

(5) Subsection (1) does not prevent a company that on the date it becomes a subsidiary of another company is a member of that other company from continuing to be such a member.

(6) Subsection (1) does not prevent a body corporate from becoming a member of a holding company of the body corporate, or prevent an allotment to a body corporate of shares in a holding company of the body corporate, by virtue of the exercise by the body corporate of any rights of conversion
  (a) attached to any shares in the holding company held by the body corporate on 31 August 1984; or
  (b) under any debentures of the holding company held by the body corporate on 31 August 1984.

(7) If a body corporate is a member of a holding company of the body corporate, subsection (1) does not prevent the body corporate from accepting or holding further shares in the holding company if those shares are allotted to the body corporate as fully paid up as a consequence of a capitalization of reserves or profits by the holding company.

(8) If a company makes an offer of shares to its members, the company
  (a) may sell, on behalf of any of its subsidiaries, any such shares that the subsidiary could, but for this section, have taken by virtue of shares in the company that are already held by the subsidiary; and
  (b) may pay to the subsidiary the proceeds of the sale.

(9) Even though a body corporate is a member of a holding company of the body corporate, it has no right to vote at—
  (a) meetings of the holding company; or
  (b) meetings of any class of members of the holding company.

(10) Subsection (9) does not apply if the body corporate is such a member in the circumstances described in subsection (2).

(11) In this section, a reference to a body corporate includes a nominee for the body corporate.

(12) In this section, a reference to shares, in relation to a holding company that is a company limited by guarantee or an unlimited company, includes the interest of the company's members, whatever the form of the interest and whether or not the company has a share capital.

Section:

114

Notifying Registrar of increase in number of members of company limited by guarantee

(1) If a company limited by guarantee increases the number of its members beyond the registered number, the company must, within 15 days after the increase is resolved by the company or takes place (whichever is the earlier), deliver to the Registrar for registration a notice of the increase in the specified form.

(2) If a company contravenes subsection (1), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 3 and, in the case of a continuing offence, to a further fine of $300 for each day during which the offence continues.

(3) In this section
registered number(註冊人數) means
  (a) the number of members with which the company proposes to register, whether contained in the incorporation form for the purposes of section 1(e) of Schedule 2 or stated in the articles under section 10(2) of the predecessor Ordinance; or
  (b) the increased number of the company's members last notified to the Registrar under subsection (1).

Division:5

Capacity and Powers of Company

Section:

115

Company’s capacity etc.

(1) A company has the capacity, rights, powers and privileges of a natural person of full age.

(2) Without limiting subsection (1), a company
  (a) may do any act that it is permitted or required to do by its articles or any Ordinance or rule of law; and
  (b) has power to acquire, hold and dispose of land.

(3) In this section
land(土地) includes any estate or interest in land, buildings, messuages and tenements of any nature or kind.

Section:

116

Company’s exercise of powers limited by articles

(1) If the objects of a company are stated in its articles, the company must not do any act that it is not authorized to do by its articles.

(2) If any power of a company is expressly modified or excluded by its articles, the company must not exercise the power contrary to that modification or exclusion.
(3 A member of a company may bring proceedings to restrain the company from doing any act in contravention of subsection (1) or (2).

(4) Proceedings must not be brought under subsection (3) in respect of any act to be done in fulfilment of a legal obligation arising from a previous act of the company.

(5) An act by a company (including a transfer of property to or by the company) is not invalid only because the company does the act in contravention of subsection (1) or (2).

Section:

117

Transaction or act binds company despite limitation in articles etc.

(1) Subject to section 119, in favour of a person dealing with a company in good faith, the power of the company's directors to bind the company, or authorize others to do so, is to be regarded as free of any limitation under any relevant document of the company. (2) For the purposes of subsection (1)
  (a) a person deals with a company if the person is a party to any transaction or any other act to which the company is a party;
  (b) a person dealing with a company is presumed, unless the contrary is proved, to have acted in good faith;
  (c) a person dealing with a company is not to be regarded as acting in bad faith by reason only of the person's knowing that an act is beyond the directors' powers under any relevant document of the company; and
  (d) a person dealing with a company is not required to inquire as to the limitations on the power of the company's directors to bind the company or authorize others to do so.

(3) This section does not affect any right of a member of the company to bring proceedings to restrain the doing of an act that is beyond the directors' powers.

(4) Proceedings must not be brought under subsection (3) in respect of any act to be done in fulfilment of a legal obligation arising from a previous act of the company.

(5) This section does not affect any liability incurred by the directors, or any other person, by reason of the directors' exceeding their powers.

(6) In this section
relevant document(有關文件), in relation to a company, means
  (a) the company's articles;
  (b) any resolutions of the company or of any class of members of the company; or
  (c) any agreements between the members, or members of any class of members, of the company.

Section:

118

Transaction or act involving directors or their associates is voidable

(1) This section applies if
  (a) a company enters into a transaction; and
  (b) the transaction binds the company because the power of the directors to bind the company, or authorize others to do so, is to be regarded under section 117 as free of any limitation under any relevant document of the company.

(2) The transaction is voidable at the instance of the company if the parties to the transaction include
  (a) a director of the company or of a holding company of the company; or
  (b) an entity connected with such a director. (3) The transaction ceases to be voidable if
  (a) restitution of any money or other asset that was the subject matter of the transaction is no longer possible;
  (b) the company is indemnified for any loss or damage resulting from the transaction;
  (c) a person who is not a party to the transaction has acquired rights in good faith and for value, and without actual notice of the directors' exceeding their powers, and those rights would be affected by the avoidance of the transaction; or
  (d) the transaction is affirmed by the company.

(4) Whether or not the transaction is avoided under subsection (2), any party to the transaction falling within subsection (2)(a) or (b) is liable, and any director of the company who has authorized the transaction is liable, to—
  (a) account to the company for any gain that the party or director has directly or indirectly made from the transaction; and
  (b) indemnify the company against any loss or damage resulting from the transaction.

(5) A person who is not a director of the company is not liable under subsection (4) if the person shows that, at the time of the transaction, the person did not know that the directors were exceeding their powers.

(6) Subject to subsection (7), this section does not affect the rights of any party to the transaction not falling within subsection (2)(a) or (b).

(7) The Court may, on application by the company or a party covered by subsection (6), affirm, sever or set aside the transaction on any terms it thinks just.

(8) This section does not exclude the operation of any other Ordinance or rule of law by which the transaction may be called in question or any liability to the company may arise.

(9) In subsection (2)(b), the reference to an entity connected with a director has the meaning given by section 486.

(10) In this section
transaction(交易) includes any act.

Section:

119

Section 117 not to apply to certain cases

(1) Section 117 does not apply to any act of an exempted company except in favour of a person who
  (a) does not know at the time of the act that the company is an exempted company; or
  (b) gives full consideration for the act and does not know
    (i) that the act is not permitted by any relevant document of the company; or
    (ii) that the act is beyond the powers of the directors.

(2) If an exempted company purports to transfer or grant an interest in property, the fact that
  (a) the act was not permitted by any relevant document of the company; or
  (b) the directors exceeded any limitation on their powers under any relevant document of the company, does not affect the title of a person who subsequently acquires the property or any interest in it for full consideration without actual notice of any of the circumstances set out in paragraph (a) or (b).

(3) In any civil proceedings arising out of subsection (1) or (2), the burden of proving that
  (a) a person knew that the company was an exempted company;
  (b) a person knew that the act was not permitted by any relevant document of the company; or
  (c) a person knew that the act was beyond the powers of the directors, lies on the person who asserts that fact.

(4) In this section
exempted company(獲豁免公司) means a company
  (a) to which a licence under section 103 relates; and
  (b) that is exempt from tax under section 88 of the Inland Revenue Ordinance (Cap 112);
relevant document(有關文件), in relation to a company, means
  (a) the company's articles;
  (b) any resolutions of the company or of any class of members of the company; or
  (c) any agreements between the members, or members of any class of members, of the company.

Section:

120

No constructive notice of matters disclosed in articles etc.

A person is not to be regarded as having notice of any matter merely because the matter is disclosed in
  (a) the articles of a company kept by the Registrar; or
  (b) a return or resolution kept by the Registrar.

Division:6

Contracts of Company

Section:

121

Contracts made by or on behalf of company

(1) This section applies to—
  (a)a contract that would be required by law to be in writing and under seal if made between natural persons;
  (b)a contract that would be required by law to be in writing, and to be signed by the parties to the contract, if made between natural persons; and
  (c)a contract that, though made orally and not in writing, would by law be valid if made between natural persons.

(2) A contract specified in subsection (1)(a) may be made by a company
  (a) in writing under the company's common seal (if any); or
  (b) in writing executed in accordance with section 127(3) and expressed (in whatever words) to be executed by the company.

(3) A contract specified in subsection (1)(b) may be made on behalf of a company in writing signed by any person acting with the company's authority (whether express or implied).

(4) A contract specified in subsection (1)(c) may be made on behalf of a company orally by any person acting with the company's authority (whether express or implied).

(5) A contract made in accordance with this section
  (a) is effective in law; and
  (b) binds the company and its successors and all other parties to the contract.

(6) A contract made in accordance with this section may be varied or discharged in the same manner in which it is authorized by this section to be made.

Section:

122

Contracts made before company’s incorporation

(1) This section applies if a contract purports to have been made in the name or on behalf of a company before the company was incorporated.

(2) Subject to any express agreement to the contrary
  (a) the contract has effect as a contract entered into by the person purporting to act for the company or as an agent for the company; and
  (b) the person is personally liable on the contract and is entitled to enforce the contract.

(3) After incorporation, the company may ratify the contract to the same extent as if
  (a) the company had already been incorporated when the contract was entered into; and
  (b) the contract had been entered into on the company's behalf by an agent acting without the company's authority.

(4) Despite subsection (2)(b), if the contract is ratified by the company, then on and after the ratification, the liability of the person mentioned in that subsection is not greater than the liability that the person would have incurred if the person had entered into the contract after the company's incorporation as an agent acting without the company's authority.

Section:

123

Bills of exchange and promissory notes

If a bill of exchange or promissory note is made, accepted or endorsed in the name of, or by or on behalf or on account of, a company by a person acting with the company's authority, the bill or note is to be regarded as having been made, accepted or endorsed on the company's behalf.

Division:7

Execution of Documents

Subdivision:1

Company Seal

Section:

124

Company may have common seal etc.

(1) A company may have a common seal.

(2) A company's common seal must be a metallic seal having the company's name engraved on it in legible form.

(3) If subsection (2) is contravened, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 3.

(4) If an officer of a company or a person on behalf of a company uses, or authorizes the use of, a seal that purports to be the company's common seal and that contravenes subsection (2), the officer or person commits an offence and is liable to a fine at level 3.

Section:

125

Official seal for use abroad

(1) A company with a common seal may have an official seal for use outside Hong Kong.

(2) Such an official seal must be a replica of the company's common seal, but have engraved on it in legible form the name of every place where it is to be used.

(3) A company with an official seal for use in a place may, by writing under its common seal, authorize any person appointed for the purpose to affix, in that place, the official seal to any deed or any other document to which the company is a party.

(4) As between a company and any person dealing with an executing agent of the company, the authority of the agent continues
  (a) if the authorization mentions a period during which the authority is to continue, until the end of the period; or
  (b) if the authorization does not mention such a period, until a notice of revocation or termination of the agent's authority has been given to the person.

(5) The person affixing an official seal must, on the deed or other document to which the seal is affixed, certify in writing the date on which, and the place at which, the seal is so affixed.

(6) A deed or other document to which an official seal is affixed binds the company as if it had been executed under the company's common seal.

(7) In this section
executing agent(簽立代理人), in relation to a company, means a person authorized by the company under subsection (3).

Section:

126

Official seal for sealing share certificates etc.

(1) A company with a common seal may have an official seal
  (a) for sealing securities issued by the company; or
  (b) for sealing documents creating or evidencing securities issued by the company.

(2) Such an official seal must be a replica of the company's common seal, but have engraved on it in legible form the word securitiesor the characters “證券” or both such word and characters.

(3) A company that was incorporated before 31 August 1984 and that has such an official seal may use the seal for sealing any securities or documents mentioned in subsection (1), despite anything in
  (a) any instrument constituting or regulating the company; or
  (b) any instrument, made before that date, relating to securities or documents sealed with the seal.

Subdivision:2

Execution Requirements

Section:

127

Execution of documents by company

(1) A company may execute a document under its common seal.

(2) If a company executes a document under its common seal, the seal must be affixed in accordance with the provisions of its articles.

(3) A company may also execute a document
  (a) in the case of a company with only one director, by having it signed by the director on the company's behalf; or
  (b) in the case of a company with 2 or more directors, by having it signed on the company's behalf by
    (i) the 2 directors or any 2 of the directors; or
    (ii) any of the directors and the company secretary of the company.

(4) For the purposes of subsection (3), if a person is to sign a document on behalf of 2 or more companies, the person must sign the document separately in each capacity.

(5) A document signed in accordance with subsection (3) and expressed (in whatever words) to be executed by the company has effect as if the document had been executed under the company's common seal.

(6) In favour of a person specified in subsection (7), a document is to be regarded as having been executed by a company if the document purports to have been signed in accordance with subsection (3).

(7) The person is a purchaser in good faith for valuable consideration and includes
  (a) a lessee;
  (b) a mortgagee; or
  (c) any other person who for valuable consideration acquires the property.

(8) This section also applies to a document that is executed, or purports to be executed, by a company in the name of or on behalf of another person whether or not that other person is also a company.

Section:

128

Execution of deeds by company

(1) A company may execute a document as a deed by
  (a) executing it in accordance with section 127;
  (b) having it expressed (in whatever words) to be executed by the company as a deed; and
  (c) delivering it as a deed.

(2) For the purposes of subsection (1)(c), a document is presumed, unless the contrary is proved, to be delivered as a deed on its being executed in accordance with section 127.

(3) If there is any conflict or inconsistency between this section and the provisions of any other Ordinance, this section prevails over those provisions to the extent of the conflict or inconsistency.

Section:

129

Execution of deeds or other documents by attorney for company

(1) A company may, either generally or in respect of any specific matter, by an instrument executed as a deed, empower any person as its attorney to execute a deed or any other document on its behalf in Hong Kong or elsewhere.

(2) A deed or any other document executed by an attorney on behalf of the company binds the company and has effect as if it were executed by the company.

(3) This section does not affect the operation of any other Ordinance as to the execution of powers of attorney.

Division:8

Re-registration of Unlimited Company as Company Limited by Shares

Section:

130

Unlimited company may apply for re-registration as company limited by shares

(1) A company registered as an unlimited company on or after 31 August 1984 may be re-registered as a company limited by shares if the company
  (a) passes a special resolution specified in subsection (2); and
  (b) delivers to the Registrar for registration an application in accordance with section 131.

(2) The special resolution
  (a) must resolve that the company is to be re-registered as a company limited by shares;
  (b) must state the manner in which the liability of the members is to be limited on the re-registration;
  (c) must provide for the alterations to the company's articles that are necessary to bring the articles into conformity with the requirements of this Ordinance in respect of the articles of a company to be formed under this Ordinance as a company limited by shares;
  (d) must contain a statement specified in subsection (3); and
  (e) may state the maximum number of shares that the company may issue.

(3) The statement
  (a) must state the total number of shares in the company issued before the re-registration, and the total number of shares that the company proposes to issue on the re-registration;
  (b) must state the total amount of share capital subscribed by its members before the re-registration, and the total amount of share capital to be subscribed by its members on the re-registration;
  (c) must state the amount to be paid up or to be regarded as paid up, and the amount to remain unpaid or to be regarded as remaining unpaid, on the total number of shares issued before the re-registration, and on the total number of shares that the company proposes to issue on the re-registration;
  (d) if the share capital is to be divided into different classes of shares on the re-registration, must also state the classes and, for each class
    (i) the particulars specified in subsection (5);
    (ii) the total number of shares in that class issued before the re-registration, and the total number of shares in that class that the company proposes to issue on the re-registration;
    (iii) the total amount of share capital in that class subscribed by its members before the re-registration, and the total amount of share capital in that class to be subscribed by its members on the re-registration; and
    (iv) the amount to be paid up or to be regarded as paid up, and the amount to remain unpaid or to be regarded as remaining unpaid, on the total number of shares in that class issued before the re-registration, and on the total number of shares in that class that the company proposes to issue on the re-registration; and
  (e) must state, in respect of each member
    (i) the number of shares that the company issued to the member before the re-registration, and the number of shares that the company proposes to issue to the member on the re-registration; and
    (ii) the total amount of share capital subscribed by the member before the re-registration, and the total amount of share capital to be subscribed by the member on the re-registration.

(4) If the shares proposed to be issued to a member on the re-registration belong to 2 or more classes, the information required under subsection (3)(e) must be stated in respect of each class.

(5) The particulars for the purposes of subsection (3)(d) are
  (a) particulars of any voting rights attached to shares in the class, including rights that arise only in certain circumstances;
  (b) particulars of any rights attached to shares in the class, as respects dividends, to participate in a distribution;
  (c) particulars of any rights attached to shares in the class, as respects capital, to participate in a distribution (including on a winding up); and
  (d) whether or not shares in the class are redeemable shares.

Section:

131

Application for re-registration

(1) An application under section 130(1)
  (a) must be in the specified form; and
  (b) must be accompanied by a copy of the company 's articles as proposed to be altered by the special resolution.

(2) Such an application may only be delivered to the Registrar on or after the date on which the Registrar receives a copy of the special resolution delivered under section 622.

Section:

132

Issue of fresh certificate of incorporation

(1) On registering an application and a copy of the articles delivered under section 131(1), the Registrar must issue a fresh certificate of incorporation certifying that the company is a company limited by shares.

(2) The certificate must be signed by the Registrar. (3) On the issue of the certificate
  (a) the company becomes a company limited by shares; and
  (b) the alterations to the company's articles as provided for in the special resolution for re-registration under section 130(2)(c) take effect despite anything in this Ordinance.

(4) A certificate of incorporation issued under subsection (1) is conclusive evidence that
  (a) all the requirements of this Ordinance in respect of re-registration of the company have been complied with; and
  (b) the company is re-registered as a company limited by shares under this Ordinance.

Section:

133

Winding up of company re-registered as company limited by shares

(1) This section applies if
  (a) a company is re-registered as a company limited by shares under this Division or section 19 of the predecessor Ordinance; and
  (b) the company is wound up.

(2) Despite section 170(1)(a) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32), a person who is not a member of the company but was a member at the time of the re-registration is liable to contribute to the assets of the company in respect of debts and liabilities of the company contracted before the re-registration if the winding up commences within 3 years beginning on the day of the re-registration.

(3) Despite section 170(1)(c) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32), a person who was a member or a past member of the company at the time of the re-registration is liable to contribute to the assets of the company in respect of debts and liabilities of the company contracted before the re-registration if every person who was a member of the company at that time is no longer a member of the company.

(4) Subsection (3) applies even though the existing members of the company have satisfied the contribution required to be made by them under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32).

(5) Despite section 170(1)(d) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32), there is no limit on the amount that a person is liable to contribute under subsection (2) or (3).

Part:

4

Share Capital

Division:1

Nature of Shares

Section:

134

Nature and transferability of shares

(1) A share or other interest of a member in a company is personal property.

(2) A share or other interest of a member in a company is transferable in accordance with the company's articles.

Section:

135

No nominal value

(1) Shares in a company have no nominal value.

(2) This section applies to shares issued before the commencement date* of this section as well as shares issued on or after that date.

Note

Division 2 of Part 4 of Schedule 11 contains transitional provisions relating to the abolition of nominal value.

Section:

136

Numbering of shares

(1) Each share in a company must be distinguished by an appropriate number, except as provided by subsection (2) or (3).

(2) If, at any time
  (a) all the issued shares in a company are fully paid up and rank equally for all purposes; or
  (b) all the issued shares of a particular class in a company are fully paid up and rank equally for all purposes, none of those shares is required to have a distinguishing number as long as it remains fully paid up and ranks equally for all purposes with all shares of the same class for the time being issued and fully paid up.

(3) If new shares are issued by a company on the terms that, within a period not exceeding 12 months, they will rank equally for all purposes with all the existing shares, or with all the existing shares of a particular class, in the company, neither the new shares nor the corresponding existing shares are required to have distinguishing numbers as long as all of them are fully paid up and rank equally for all purposes.

(4) If subsection (3) applies and the shares are not numbered, any share certificates for the new shares must be appropriately worded or enfaced.

Section:

137

Share certificate to be proof of title in the absence of contrary evidence

In the absence of evidence to the contrary, a certificate issued by a company specifying any shares held by a member in the company is proof of the member's title to the shares.

Section:

138

Repeal of power to issue stock

A company does not have power to convert its shares into stock.

Note

Sections 174 and 175 contain provisions relating to the reconversion of stock into shares.

Section:

139

Repeal of power to issue share warrants

(1) A company does not have power to issue a share warrant.

(2) The bearer of a share warrant issued before the commencement date* of this section is entitled, on surrendering it for cancellation, to have the bearer's name entered in the register of members of the company.

(3) If the company enters the bearer 's name in the register of its members without the share warrant being surrendered and cancelled, the company is liable for any loss suffered by a person as a result of the bearer's name being entered in the register.

(4) The company must enter the date of surrender of a share warrant in the register of its members.

(5) If a company's articles so provide, the bearer of a share warrant may be regarded as a member of the company,
either to the full extent or for any purposes specified in the articles.

Division:2

Allotment and Issue of Shares

Section:

140

Exercise by directors of power to allot shares or grant rights

(1) Except in accordance with section 141, the directors of a company must not exercise any power
  (a) to allot shares in the company; or
  (b) to grant rights to subscribe for, or to convert any security into, shares in the company.

(2) Subsection (1) does not apply to
  (a) an allotment of shares, or grant of rights, under an offer made to the members of the company in proportion to their shareholdings;
  (b) an allotment of shares, or grant of rights, on a bonus issue of shares to the members of the company in proportion to their shareholdings;
  (c) an allotment to a founder member of a company of shares that the member, by signing the company's articles, has agreed to take; or
  (d) an allotment of shares made in accordance with a grant of a right to subscribe for, or to convert any security into, shares if the right was granted in accordance with an approval under section 141.

(3) For the purposes of subsection (2)(a), the offer is not required to be made to any member whose address is in a place where the offer is not permitted under the law of that place.

(4) A director commits an offence if the director knowingly contravenes, or authorizes or permits a contravention of, this section.

(5) A director who commits an offence under subsection (4) is liable to a fine at level 5 and to imprisonment for 6 months.

(6) Nothing in this section or section 141 affects the validity of an allotment or other transaction.

Section:

141

Allotment of shares or grant of rights with company approval

(1) The directors of a company may exercise a power
  (a) to allot shares in the company; or
  (b) to grant rights to subscribe for, or to convert any security into, shares in the company, if the company gives approval in advance by resolution of the company.

(2) Approval may be given for a particular exercise of the power or for its exercise generally, and may be unconditional or subject to conditions.

(3) Subject to subsections (4) and (5), an approval expires
  (a) if the company is required to hold an annual general meeting, on the earlier of
    (i) the conclusion of the annual general meeting held next after the approval was given;
    (ii) the expiry of the period within which the next annual general meeting after the approval was given is required to be held;
  (b) if the company is not required to hold an annual general meeting because of section 612(1), on the date on which the requirements of that section are satisfied; or
  (c) if the company is not required to hold an annual general meeting for any other reason, on the date specified in the approval, which must not be more than 12 months after the approval was given.

(4) An approval may be revoked or varied at any time by resolution of the company. (5) The directors may allot shares or grant rights after an approval has expired if
  (a) the shares are allotted, or the rights are granted, under an offer, agreement or option made or granted by the company before the approval expired; and
  (b) the approval allowed the company to make or grant an offer, agreement or option that would or might require shares to be allotted, or rights to be granted, after the approval had expired.

Section:

142

Return of allotment

(1) Within one month after an allotment of shares, a limited company must deliver to the Registrar for registration a return of the allotment that complies with subsection (2).

(2) A return
  (a) must be in the specified form;
  (b) must include a statement of capital as at the date of the allotment that complies with section 201; (c) must state
    (i) the number of shares allotted;
    (ii) the name and address of each allottee; and
    (iii) if the company's issued share capital is increased as a result of the allotment, the amount of the increase;
  (d) for any shares allotted for consideration (whether wholly or partly cash consideration or non-cash consideration)
(i) must state the amount paid or regarded as paid on each share and the amount (if any) remaining unpaid or regarded as remaining unpaid on each share;
    (ii) in the case of an allotment wholly or partly for non-cash consideration under an arrangement made under Division 2 of Part 13, must contain particulars of the order of the Court sanctioning the arrangement; and
    (iii) in any other case of an allotment wholly or partly for non-cash consideration, must contain particulars of the contract for sale, or for services or other consideration in respect of which the shares were allotted; and
  (e) for any shares allotted credited as fully paid up (whether on or without a capitalization)
    (i) must state the amount regarded as paid on each share; and
    (ii) must contain particulars of the resolution authorizing the capitalization or allotment.

(3) If a limited company contravenes subsection (1), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

(4) If a limited company fails to deliver a return that complies with subsection (2) within one month after an allotment of shares, the Court may, on application by the company or a responsible person of the company, extend the period for delivery of the return by a period determined by the Court.

(5) The Court may extend a period under subsection (4) only if it is satisfied
  (a) that failure to deliver the return was accidental or due to inadvertence; or
  (b) that it is just and equitable to extend the period.

(6) If the Court extends the period for delivery of a return, any liability already incurred by the company or a responsible person of the company for an offence under subsection (3) is extinguished and subsection (1) has effect as if the reference to one month were a reference to the extended period.

Section:

143

Registration of allotment

(1) A company must register an allotment of shares as soon as practicable and in any event within 2 months after the date of the allotment, by entering in the register of its members the information referred to in section 627(2) and (3).

(2) If a company fails to register an allotment of shares within 2 months after the date of the allotment, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

144

Issue of share certificate on allotment

(1) Within 2 months after an allotment of shares, a company must complete the certificates for the shares and have the certificates ready for delivery.

(2) Subsection (1) does not apply if the conditions of issue of the shares provide otherwise.

(3) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

145

Order of Court for delivery of share certificate

(1) If a company contravenes section 144 in relation to an allotment of shares, a person entitled to the certificates for the shares may serve a notice on the company requiring it to deliver the certificates to the person within 10 days.

(2) If a company on which a notice has been served under subsection (1) does not deliver the certificates within 10 days after service of the notice, the person may apply to the Court for an order under subsection (3).

(3) On an application under subsection (2), the Court may make an order directing the company and any officer of the company to deliver the certificates to the person within the period specified in the order.

(4) The order may provide that all costs of and incidental to the application are to be borne by the company or by an officer of the company responsible for the contravention.

Section:

146

Validation by Court of issue or allotment

(1) This section applies if a company purports to issue or allot shares and
  (a) the issue or allotment is or may be invalid for any reason; or
  (b) the terms of the issue or allotment are inconsistent with or not authorized by
    (i) this Ordinance or any other Ordinance; or
    (ii) the company's articles.

(2) The company, a creditor of the company or a holder or mortgagee of any of the shares may apply to the Court for an order validating, or confirming the terms of, the issue or allotment.

(3) The Court may make an order under subsection (2) if the Court is satisfied that it is just and equitable to do so.

(4) On delivery of an office copy of the order to the Registrar, the order has effect from the time of the purported issue or allotment.

Division:3

Commissions and Expenses

Section:

147

General prohibition of commissions, discounts and allowances

(1) Except as permitted by section 148, a company must not apply any of its shares or share capital, either directly or indirectly, in payment of any commission, discount or allowance to a person in consideration of the person
  (a) subscribing or agreeing to subscribe (whether absolutely or conditionally) for shares in the company; or
  (b) procuring or agreeing to procure subscriptions (whether absolute or conditional) for shares in the company.

(2) It is immaterial how the shares or share capital are applied, whether by being added to the purchase money of property acquired by the company or to the contract price of work to be executed for the company, or being paid out of the nominal purchase money or contract price, or otherwise.

(3) Nothing in this section affects the payment of brokerage by a company.

Section:

148

Permitted commissions

(1) If the conditions in subsection (2) are satisfied, a company may pay a commission to a person in consideration of the person
  (a) subscribing or agreeing to subscribe (whether absolutely or conditionally) for shares in the company; or
  (b) procuring or agreeing to procure subscriptions (whether absolute or conditional) for shares in the company.

(2) The conditions are that
  (a) the payment of the commission is authorized by the company's articles;
  (b) the commission paid or agreed to be paid does not exceed the lesser of
    (i) 10% of the price at which the shares are issued;
    (ii) the amount or rate authorized by the articles; and
  (c) if the shares are not offered to the public for subscription, the company, before making the payment
    (i) delivers to the Registrar for registration a notice in the specified form disclosing the amount or rate of the commission and the number of shares (if any) that persons have agreed for a commission to subscribe for absolutely; and
    (ii) discloses the amount or rate of the commission and the number of shares (if any) that persons have agreed for a commission to subscribe for absolutely in any circular or notice issued by the company inviting subscriptions for the shares.

(3) A vendor to, promoter of, or other person who receives payment in money or shares from, a company may apply any part of the money or shares so received in payment of any commission the payment of which directly by the company would be permitted by this section.

(4) If a company contravenes the condition referred to in subsection (2)(c)(i), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4.

Section:

149

Capital may be applied in writing off certain expenses and commission

A company may apply its share capital in writing off
  (a) the preliminary expenses of the company;
  (b) any commission paid under section 148 or under section 46 of the predecessor Ordinance; or
  (c) any other expenses of any issue of shares in the company.

Division:4

Transfer and Transmission of Shares

Subdivision:1

Transfer of Shares

Section:

150

Requirement for instrument of transfer

(1) A company must not register a transfer of shares in the company unless a proper instrument of transfer has been delivered to the company.

(2) Subsection (1) does not affect any power of a company to register as a member a person to whom the right to shares has been transmitted by operation of law.

Section:

151

Registration of transfer or refusal of registration

(1) The transferee or transferor of shares in a company may lodge the transfer with the company.

(2) Within 2 months after the transfer is lodged, the company must either
  (a) register the transfer; or
  (b) send the transferee and the transferor notice of refusal to register the transfer.

(3) If a company refuses registration, the transferee or transferor may request a statement of the reasons for the refusal.

(4) If a request is made under subsection (3), the company must, within 28 days after receiving the request
  (a) send the person who made the request a statement of the reasons; or
  (b) register the transfer.

(5) If a company contravenes subsection (2) or (4), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

152

Order of Court for registration

(1) If a company refuses to register a transfer, the transferee or the transferor may apply to the Court for an order under this section.

(2) On an application under subsection (1), the Court may order the company to register the transfer, if the Court is satisfied that the application is well-founded.

Section:

153

Transfer by personal representative

A transfer of a share or other interest of a deceased member of a company by his or her personal representative is as valid as if the personal representative had been the registered holder of that share or interest at the time of execution of the instrument of transfer.

Section:

154

Certification of transfer

(1) The certification by a company of an instrument of transfer of shares in the company
  (a) is a representation by the company to any person acting on the faith of the certification that documents have been produced to the company that evidence title to the shares in the transferor named in the instrument; and
  (b) is not a representation that the transferor has any title to the shares.

(2) If a person acts on the faith of a false certification by a company made negligently, the company is under the same liability to the person as if the certification had been made fraudulently.

(3) For the purposes of this section, an instrument of transfer is certified by a company if it bears
  (a) the words certificate lodged, or words to the same effect, in English or Chinese; and
  (b) under or adjacent to those words, the signature or initials of a person having the actual or apparent authority to certify transfers on behalf of the company.

(4) Unless the contrary is proved, a signature or initials appearing on an instrument of transfer as referred to in subsection (3)(b) must be regarded
  (a) as the signature or initials of the person whose signature or initials they purport to be; and
  (b) as having been placed on the instrument by that person or by another person who has the actual or apparent authority to use the signature or initials for the purpose of certifying transfers on behalf of the company.

Section:

155

Issue of share certificate on transfer

(1) Within the period specified in subsection (2), a company must complete the certificates for any of its shares that are transferred and have the certificates ready for delivery.

(2) The period is
  (a) for a private company, 2 months after the day on which the transfer is lodged with the company;
  (b) for any other company, 10 business days after the day on which the transfer is lodged with the company.

(3) Subsection (1) does not apply to a transfer if
  (a) the conditions of issue of the shares provide otherwise;
  (b) stamp duty has not been paid in respect of the transfer;
  (c) the transfer is invalid; or
  (d) the company, being entitled to do so, refuses to register the transfer.

(4) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

(5) In this section
business day(營業日) means a day on which a recognized stock market is open for the business of dealing in securities.

Section:

156

Order of Court for delivery of share certificate

(1) If a company contravenes section 155 in relation to a transfer of shares, a person entitled to the certificates for the shares may serve a notice on the company requiring it to deliver the certificates to the person within 10 days.

(2) If a company on which a notice has been served under subsection (1) does not deliver the certificates within 10 days after service of the notice, the person may apply to the Court for an order under subsection (3).

(3) On an application under subsection (2), the Court may make an order directing the company and any officer of the company to deliver the certificates to the person within the period specified in the order.

(4) The order may provide that all costs of and incidental to the application are to be borne by the company or by an officer of the company responsible for the contravention.

Section:

157

Compensation regarding forged share transfers

(1) A company may
  (a) pay compensation to a person for loss arising from a transfer of shares in the company under a forged transfer or a transfer under a forged power of attorney;
  (b) provide, by insurance, reservation of capital or accumulation of income, a fund to meet claims for compensation;
  (c) borrow on the security of its property for the purpose of paying compensation; and
  (d) impose any reasonable restrictions on the transfer of its shares or with respect to powers of attorney for the transfer of its shares that the company considers necessary to guard against losses arising from forgery.

(2) A company that pays compensation to a person under this section has the same rights and remedies against the person liable for the loss as the person compensated would have had.

(3) If the shares in a company have, by amalgamation or otherwise, become shares in another company, the other company has the same powers under this section as the first company would have had if it had continued.

Subdivision:2

Transmission of Shares by Operation of Law

Section:

158

Registration or refusal of registration

(1) This section applies if the right to shares is transmitted to a person by operation of law and the person notifies the company in writing that the person wishes to be registered as a member of the company in respect of the shares.

(2) Within 2 months after receiving the notification, the company must either
  (a) register the person as a member of the company in respect of the shares; or
  (b) send the person notice of refusal of registration.

(3) If a company refuses registration, the person may request a statement of the reasons for the refusal.

(4) If a person makes a request under subsection (3), the company must, within 28 days after receiving the request
  (a) send the person a statement of the reasons; or
  (b) register the person as a member of the company in respect of the shares.

(5) If a company contravenes subsection (2) or (4), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

159

Order of Court for registration

(1) If a company refuses registration under section 158, the person to whom the right to the shares was transmitted may apply to the Court for an order under this section.

(2) On an application under subsection (1), the Court may order the company to register the person as a member of the company in respect of the shares, if the Court is satisfied that the application is well-founded.

Section:

160

Pre-emption rights in relation to transmission by law

(1) This section applies if a company's articles give a member or class of members of the company a right of pre- emption or right to purchase shares in the company on the occurrence of an event that constitutes a transmission of the right to the shares by operation of law.

(2) If this section applies, the registration as a member of the company of the person to whom the right to the shares is transmitted is subject to the right of pre-emption or right to purchase shares contained in the articles and that right may be enforced against the person.

Subdivision:3

General

Section:

161

Evidence of grant of probate etc.

For the purposes of a transfer of shares or transmission of the right to shares, a company must accept as sufficient evidence of the grant of probate of the will or letters of administration of a deceased person the production to the company of a document that is by law sufficient evidence of that grant.

Division:5

Replacement of Listed Companies’ Lost Share Certificates

Section:

162

Interpretation

In this Division
eligible person (合資格人士) , in relation to shares in a listed company, means
  (a) a registered holder of the shares; or
  (b) a person who claims to be entitled to have the person's name entered in the register of members of the
company in respect of the shares;
genuine purchaser (真正購買者) , in relation to shares, means
  (a) a person (other than a person to whom a new certificate for the shares is issued under this Division) who purchases the shares in good faith for value and without notice of any defect in the title of the seller; or
  (b) a person who becomes entitled to the shares at any time after the purchase of them by a person referred to in paragraph (a);
new certificate (新股份證明書) means a share certificate that replaces a share certificate that has been lost;
original certificate (原有股份證明書) means a share certificate that has been lost;
registered holder (登記持有人) , in relation to shares in a listed company, means a person whose name is entered in the register of members of the company in respect of the shares;
website (網站) , in relation to a company (other than a recognized exchange company), means the website on which the company is required, by the listing rules applicable to the recognized stock market concerned, to publish announcements, notices or other documents.

Section:

163

Application for new certificate

(1) If a share certificate for shares in a listed company has been lost, an eligible person may apply to the company for a new certificate.

(2) The application
  (a) must be in the specified form; and
  (b) must be accompanied by a statutory declaration by the eligible person stating the following
    (i) that the original certificate has been lost;
    (ii) when the original certificate was last in the person's possession and how the person ceased to have possession of it;
    (iii) whether the person has executed any transfer in respect of the shares, in blank or otherwise;
    (iv) that no other person is entitled to have their name entered in the register of members of the company in respect of the shares; and
    (v) any other matters that are necessary to verify the grounds on which the application is made.

Section:

164

Publication requirements

(1) A listed company that intends to issue a new certificate on an application under section 163 must publish a notice in the specified form in accordance with this section.

(2) The notice must be published
  (a) on the company's website; and
  (b) in the Gazette if
    (i) the eligible person making the application is not the registered holder of the shares or does not have the registered holder's consent to make the application; or
    (ii) the latest value of the shares exceeds $200000.

(3) The notice must be published in the Gazette under subsection (2)(b) within one month after it is first published on the company's website under subsection (2)(a).

(4) Before publishing a notice under this section, the company must
  (a) deliver a copy of the notice to the recognized exchange company that operates the stock market on which the shares concerned are listed; and
  (b) obtain a certificate from an authorized officer of that exchange company that the copy is being exhibited in accordance with subsection (5).

(5) A recognized exchange company must exhibit a copy of a notice received under subsection (4)(a) in a conspicuous place on the premises on which the stock market operates or make the notice available on its official website for a period of at least
  (a) one month, for a notice that is not required to be published under subsection (2)(b); or
  (b) 3 months, for a notice that is required to be published under subsection (2)(b).

(6) For the purposes of subsection (5), a failure to make a copy of a notice available on an exchange company's official website throughout a period mentioned in that subsection is to be disregarded if
  (a) the notice is made available on the website for part of that period; and
  (b) the failure is wholly attributable to circumstances that it would not be reasonable to have expected that exchange company to prevent or avoid.

(7) If the application was made by an eligible person who is not the registered holder of the shares and does not have the registered holder's consent to make the application, the listed company
  (a) must serve a copy of the notice under this section on the registered holder by sending it by registered post to the registered holder's last address appearing in the register of members of the company; and
  (b) must not publish the notice under this section until at least 3 months after the day on which the copy was served.

(8) In this section
latest value(最新價值) of shares means the value of the shares calculated at the last recorded price paid for shares of the same class in the company at the recognized stock market prior to the making of the application for the new certificate.

Section:

165

Issue of new certificate

(1) A listed company may issue a new certificate on an application under section 163 if
  (a) the company has published a notice under section 164 and
    (i) if the notice is published under section 164(2)(a), the notice has been made available on the company's website throughout a period of at least one month; or
    (ii) if the notice is published under section 164(2)(b), the notice has been made available on the company 's website throughout a period of at least 3 months and published in the Gazette in accordance with section 164(3);
  (b) the company has not received notice of any other claim in respect of the shares; and
  (c) in the case of an application by an eligible person who is not the registered holder of the shares
    (i) an instrument of transfer in respect of the shares has been delivered to the company under section 150; or
    (ii) if the application was made without the registered holder's consent, the company has caused an instrument of transfer to be executed on behalf of the registered holder by a person appointed by the company and executed by the applicant on the applicant's own behalf.

(2) An instrument of transfer referred to in subsection (1)(c)(ii) is to be regarded as an instrument of transfer duly delivered to the company under section 150.

(3) A listed company that issues a new certificate must without delay
  (a) cancel the original certificate; and
  (b) record the issue of the new certificate and cancellation of the original certificate in the register of its members.

(4) For the purposes of subsection (1)(a), a failure to make a notice available on a company's website throughout a period mentioned in that subsection is to be disregarded if
  (a) the notice is made available on the website for part of that period; and
  (b) the failure is wholly attributable to circumstances that it would not be reasonable to have expected the company to prevent or avoid.

Section:

166

Public notice of issue of new certificate

(1) A listed company that issues a new certificate must
  (a) publish a notice in the specified form in accordance with this section; and
  (b) deliver a copy of the notice to the recognized exchange company that operates the stock market on which the shares concerned are listed within 14 days after the date of issue.

(2) The notice must be published by making it available on the listed company's website throughout a period of at least 7 days beginning on a date falling within 14 days after the date of issue.

(3) If the listed company was required by section 164(2)(b) to publish a notice in the Gazette of its intention to issue the new certificate, the notice under this section must also be published in the Gazette within 14 days after the date of issue.

(4) For the purposes of subsection (2), a failure to make a notice available on a listed company 's website throughout a period mentioned in that subsection is to be disregarded if
  (a) the notice is made available on the website for part of that period; and
  (b) the failure is wholly attributable to circumstances that it would not be reasonable to have expected the company to prevent or avoid.

(5) If a listed company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 3 and, in the case of a continuing offence, to a further fine of $300 for each day during which the offence continues.

Section:

167

Orders of Court for rectification of the register

(1) Subject to this section, if a listed company issues a new certificate in respect of shares, nothing in this Division affects the power of the Court to make an order under section 633 in favour of a person claiming to be entitled to the shares as against
  (a) the person to whom the new certificate is issued; or
  (b) a person whose name is subsequently entered in the register of members of the company in respect of the shares.

(2) The Court must not make an order under section 633 as against a person referred to in subsection (1)(b) if that person is a genuine purchaser of the shares.

(3) If the Court makes an order under section 633 as against the person to whom the new certificate is issued or a person whose name is subsequently entered in the register of members of the company in respect of the shares
  (a) the Court must not order the payment of damages by the company; and
  (b) the company is not otherwise liable for any damage caused by the issue of the new certificate or cancellation of the original certificate in accordance with this Division.

Note

Section 633 gives the Court power to make an order for rectification of the register of members of a company.

Section:

168

Liability if rectification cannot be ordered

(1) This section applies if an order cannot be made under section 633 because of section 167(2).

(2) The company is not liable for any damage suffered by the claimant because of the issue of the new certificate or cancellation of the original certificate, unless the company has acted deceitfully.

(3) If the genuine purchaser purchased the shares from the person to whom the new certificate is issued, the person to whom the new certificate is issued is liable to the claimant for the value of the shares as at the date of purchase.

(4) If the genuine purchaser purchased the shares from a person whose name was subsequently entered in the register of members of the company in respect of the shares, the person to whom the new certificate is issued and any person whose name was subsequently entered in the register in respect of the shares (other than a genuine purchaser) are jointly and severally liable to the claimant for the value of the shares as at the date the shares were purchased by the genuine purchaser.

(5) In this section
claimant(申索人) means the person in whose favour an order could have been made under section 633 but for section 167(2).

Section:

169

Applicant to pay expenses

(1) An applicant for a new certificate must pay all expenses relating to the application.

(2) A listed company may refuse to deal, or to deal further, with an application until it is satisfied that the applicant has made reasonable provision for payment of the expenses relating to the application.

Division:6

Alteration of Share Capital

Section:

170

Permitted alteration of share capital

(1) A limited company may alter its share capital in any one or more of the ways set out in subsection (2).

(2) The company may
  (a) increase its share capital by allotting and issuing new shares in accordance with this Part;
  (b) increase its share capital without allotting and issuing new shares, if the funds or other assets for the increase are provided by the members of the company;
  (c) capitalize its profits, with or without allotting and issuing new shares;
  (d) allot and issue bonus shares with or without increasing its share capital;
  (e) convert all or any of its shares into a larger or smaller number of shares;
  (f) cancel shares
    (i) that, at the date the resolution for cancellation is passed, have not been taken or agreed to be taken by any person; or
    (ii) that have been forfeited.

(3) A limited company may alter its share capital as referred to in subsection (2)(e) or (f) only by resolution of the company.

Note

Sections 140 and 141 contain provisions requiring a resolution of the company for an allotment of shares. Those sections may be relevant to an alteration of share capital referred to in subsection (2)(a), (c) or (d).

(4) A resolution referred to in subsection (3) may authorize the company to exercise the power
  (a) on more than one occasion;
  (b) at a specified time or in specified circumstances.

(5) Any amount remaining unpaid on shares being converted under subsection (2)(e) is to be divided equally among the replacement shares.

(6) If shares are cancelled under subsection (2)(f), the company must reduce its share capital by the amount of the shares cancelled.

(7) For the purposes of Part 5, a cancellation of shares under this section is not a reduction of share capital.

(8) A limited company's articles may exclude or restrict the exercise of a power conferred by this section.

Section:

171

Notice of alteration of share capital

(1) Within one month after altering its share capital under section 170, a company must deliver a notice to the Registrar for registration in relation to the alteration of share capital.

(2) The notice
  (a) must be in the specified form;
  (b) if the company's issued share capital is increased by the alteration, must state the amount of the increase; and
  (c) must include a statement of capital as at the date of the alteration that complies with section 201.

(3) A company is not required to deliver a notice under this section in relation to an alteration of share capital involving an allotment of shares.

Note

For an allotment of shares, section 142 requires a company to deliver a return of the allotment to the Registrar for registration.

(4) If a company contravenes subsection (1), the company, and every responsible person of the company, commit an
offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

172

Redenomination of share capital

(1) A limited company may, by resolution of the company, convert its share capital or any class of shares from one currency to another currency. This is known as a redenomination.

(2) A resolution under this section may authorize a limited company to redenominate its share capital
  (a) on more than one occasion;
  (b) at a specified time or in specified circumstances.

(3) A redenomination does not affect any rights or obligations of members under the company's articles, or any restrictions affecting members under the company's articles.

(4) In particular, it does not affect any entitlement to dividends (including entitlement to dividends in a particular currency), voting rights or liability in respect of amounts remaining unpaid on shares (including liability in a particular currency).

(5) For the purposes of this section, the company's articles include the terms on which any shares in the company are allotted or held.

(6) A limited company's articles may exclude or restrict the exercise of a power conferred by this section.

Section:

173

Notice of redenomination

(1) Within one month after passing a resolution under section 172, a company must deliver a notice in the specified form to the Registrar for registration in relation to the redenomination.

(2) The notice must include a statement of capital as at the date of the redenomination that complies with section 201.

(3) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

174

Reconversion of stock into shares

(1) A company that has converted paid up shares into stock (before the repeal by this Ordinance of the power to do so) may, by resolution of the company, reconvert that stock into paid up shares.

Note

Section 138 repeals the power of a company to convert its shares into stock.

(2) A resolution under this section may authorize a company to exercise the power to reconvert stock
  (a) on more than one occasion;
  (b) at a specified time or in specified circumstances.

Section:

175

Notice of reconversion

(1) Within one month after passing a resolution under section 174, a company must deliver a notice in the specified form to the Registrar for registration in relation to the reconversion of stock.

(2) The notice must include a statement of capital as at the date of the reconversion that complies with section 201.

(3) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Division:7

Classes of Shares and Class Rights

Subdivision:1

Companies having a Share Capital

Section:

176

Application of Subdivision

This Subdivision applies to a company that has a share capital.

Section:

177

Rights attached to shares

In this Ordinance, a reference to the rights attached to a share in a class of shares in a company is a reference to the rights of the holder of that share as a member of the company.

Section:

178

Classes of shares

(1) For the purposes of this Ordinance, shares are in one class if the rights attached to them are in all respects uniform.

(2) The rights attached to shares are not to be regarded as different from those attached to other shares only because they do not carry the same rights to dividends in the 12 months immediately following their allotment.

Section:

179

Description of shares of different classes

(1) A share certificate issued by a company that has different classes of shares must contain in a prominent position a statement
  (a) stating that the company's share capital is divided into different classes of shares; and
  (b) specifying the voting rights attached to shares in each class.

(2) If a company has a class of shares the holders of which are not entitled to vote at general meetings of the company
  (a) the descriptive title of shares in the class must include the words non votingor the Chinese characters "無表決權"; and
  (b) the company must ensure that those words appear legibly on any share certificate issued by the company.

(3) Subsection (2) does not apply to shares that are described as preference shares or preferred shares.

(4) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

180

Varying class rights

(1) Rights attached to shares in a class of shares in a company may be varied only
  (a) in accordance with provisions in the company's articles for the variation of those rights; or
  (b) if there are no such provisions, with the consent of holders of shares in that class given in accordance with this section.

(2) Subsection (1) is without prejudice to any other restrictions on the variation of the rights.

Example

A company could make an agreement with the holders of shares in a class that imposes restrictions on the variation of class rights.

(3) The consent required for the purposes of this section is
  (a) written consent of holders representing at least 75% of the total voting rights of holders of shares in the class; or
  (b) a special resolution passed at a separate general meeting of holders of shares in the class sanctioning the variation.

(4) A variation takes effect
  (a) if no application is made under section 182 for it to be disallowed, at the end of the period in which applications may be made under that section; or
  (b) if an application is made within that period, at the time the application is withdrawn or finally determined (unless the variation is disallowed).

(5) Any amendment of a provision in a company's articles for the variation of the rights attached to shares in a class, or the insertion of any such provision into the articles, is itself to be regarded as a variation of those rights.

(6) Nothing in this section affects the Court's powers under sections 673, 675 and 725.

Section:

181

Notifying class members of variation

(1) If the rights attached to shares in any class of shares in a company are varied, the company must give written notice of the variation to each holder of shares in that class within 14 days after the date on which the variation is made.

(2) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

182

Disallowance or confirmation of variation by Court

(1) If the rights attached to shares in any class of shares in a company are varied, holders representing at least 10%
of the total voting rights of holders of shares in the class may apply to the Court to have the variation disallowed.

(2) An application must be made within 28 days after the date on which the variation is made.

(3) An application may be made on behalf of the members entitled to apply by any one or more of them appointed in writing by all of them.

(4) The following persons are entitled to be heard on an application
  (a) the applicant;
  (b) any other person who appears to the Court to be interested in the application.

(5) The Court may, by order, disallow the variation if it is satisfied that the variation would unfairly prejudice the members represented by the applicant.

(6) If the Court is not so satisfied, it must, by order, confirm the variation.

(7) Nothing in this section affects
  (a) the right of a member to petition the Court under section 724; or
  (b) the Court's powers under section 725.

Section:

183

Delivery of order of Court to Registrar

(1) If the Court makes an order under section 182 in relation to a company, the company must deliver an office copy of the order to the Registrar for registration within 15 days after it is made.

(2) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

184

Notifying Registrar of variation

(1) If the rights attached to shares in any class of shares in a company are varied, the company must deliver to the Registrar for registration, within one month after the date on which the variation takes effect
  (a) a copy of the resolution or other document that authorized the variation; and
  (b) a notice in the specified form including a statement of capital, as at the date on which the variation takes effect, that complies with section 201.

(2) Subsection (1)(a) does not apply if the company is required to deliver a copy of the resolution or other document to the Registrar under another provision of this Ordinance.

(3) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Subdivision:2

Companies without a Share Capital

Section:

185

Application of Subdivision

This subdivision applies to a company that does not have a share capital.

Section:

186

Rights of members

In this Ordinance, a reference to the rights of a class of members of a company that does not have a share capital is a reference to the rights of the members in that class in their capacity as members of the company.

Section:

187

Classes of members

For the purposes of this Ordinance, members of a company that does not have a share capital are in one class if the rights of the members are in all respects uniform.

Section:

188

Varying class rights

(1) Rights of a class of members of a company that does not have a share capital may be varied only
  (a) in accordance with provisions in the company's articles for the variation of those rights; or
  (b) if there are no such provisions, with the consent of the members of that class given in accordance with this section.

(2) Subsection (1) is without prejudice to any other restrictions on the variation of the rights.

Example

A company could make an agreement with the members of a class that imposes restrictions on the variation of class rights.

(3) The consent required for the purposes of this section is
  (a) written consent of at least 75% of the members in the class; or
  (b) a special resolution passed at a separate general meeting of the members in the class sanctioning the variation.

(4) A variation takes effect
  (a) if no application is made under section 190 for it to be disallowed, at the end of the period in which applications may be made under that section; or
  (b) if an application is made within that period, at the time the application is withdrawn or finally determined (unless the variation is disallowed).

(5) Any amendment of a provision in a company's articles for the variation of the rights of a class of members, or the insertion of any such provision into the articles, is itself to be regarded as a variation of those rights.

(6) Nothing in this section affects the Court's powers under sections 673, 675 and 725.

Section:

189

Notifying class members of variation

(1) If the rights of any class of members of a company that does not have a share capital are varied, the company must give written notice of the variation to each member in that class within 14 days after the date on which the variation is made.

(2) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

190

Disallowance or confirmation of variation by Court

(1) If the rights of any class of members of a company that does not have a share capital are varied, members representing at least 10% of the members in the class may apply to the Court to have the variation disallowed.

(2) An application must be made within 28 days after the date on which the variation is made.

(3) An application may be made on behalf of the members entitled to apply by any one or more of them appointed in writing by all of them.

(4) The following persons are entitled to be heard on an application
  (a) the applicant;
  (b) any other person who appears to the Court to be interested in the application.

(5) The Court may, by order, disallow the variation if it is satisfied that the variation would unfairly prejudice the members represented by the applicant.

(6) If the Court is not so satisfied, it must, by order, confirm the variation.

(7) Nothing in this section affects
  (a) the right of a member to petition the Court under section 724; or
  (b) the Court's powers under section 725.

Section:

191

Delivery of order of Court to Registrar

(1) If the Court makes an order under section 190 in relation to a company, the company must deliver an office copy of the order to the Registrar for registration within 15 days after it is made.

(2) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Section:

192

Notifying Registrar of variation

(1) If the rights of any class of members of a company that does not have a share capital are varied, the company must deliver to the Registrar for registration, within one month after the date on which the variation takes effect—
  (a) a copy of the resolution or other document that authorized the variation; and
  (b) a notice in the specified form.

(2) Subsection (1)(a) does not apply if the company is required to deliver a copy of the resolution or other document to the Registrar under another provision of this Ordinance.

(3) If a company contravenes this section, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4 and, in the case of a continuing offence, to a further fine of $700 for each day during which the offence continues.

Subdivision:3

General

Section:

193

Variation includes abrogation

In this Division and (unless the context otherwise requires) in any provision in a company's articles for the variation of class rights, a reference to a variation of those rights includes an abrogation of those rights.

Division:8

Supplementary and Miscellaneous

Subdivision:1

Relief from Share Capital Requirements

Section:

194

Interpretation

(1) In this Division
arrangement (安排) means any agreement, scheme or arrangement;
company (公司) , except in reference to an issuing company, includes any body corporate;
equity share capital (權益股本) means a company's issued share capital excluding any part of that capital that, neither as respects dividends nor as respects capital, carries any right to participate beyond a specified amount in a distribution;
equity shares (權益股份) means shares comprised in a company's equity share capital;
issuing company (發行公司) means a company that issues shares;
non-equity shares (非權益股份) means shares in a company other than equity shares;
transfer (轉讓) of shares includes transfer of a right to be included in the company's register of members in respect of the shares.

(2) In this Division
  (a) a reference to the acquisition by a company of shares includes the acquisition of shares by a nominee of the company;
  (b) a reference to the issue or transfer of shares to a company includes the issue or transfer of shares to a nominee of the company;
  (c) a reference to the transfer of shares by a company includes the transfer of shares by a nominee of the company.

Section:

195

Group reconstruction relief

(1) This section applies if an issuing company
  (a) is a wholly owned subsidiary of another company (the holding company); and
  (b) issues shares
    (i) to the holding company; or
    (ii) to another wholly owned subsidiary of the holding company,
in consideration for the transfer to the issuing company of non-cash assets of a company (the transferor company) that is a member of the group of companies that comprises the holding company and all its wholly owned subsidiaries.

(2) Any excess of the value of the assets transferred over their net base value may be disregarded when recording as share capital of the issuing company the amount of consideration for the issue by the issuing company of its shares. Consequently, the minimum amount of consideration required to be recorded as share capital of the issuing company in respect of the shares issued for the transfer is the net base value of the assets transferred.

(3) The net base value of the assets transferred is the amount by which the base value of the assets transferred exceeds the base value of any liabilities of the transferor company assumed by the issuing company as consideration for the assets transferred.

(4) For the purposes of this section
  (a) the base value of assets transferred is the lesser of
    (i) the cost of those assets to the transferor company;
    (ii) the amount at which those assets are stated in the transferor company ' s accounting records immediately before the transfer;
  (b) the base value of liabilities assumed is the amount at which they are stated in the transferor company's accounting records immediately before the transfer.

Section:

196

Merger relief

(1) This section applies if an issuing company has secured at least a 90% equity holding in another company under an arrangement providing for the issue of equity shares in the issuing company on terms that the consideration for the shares issued is to be provided
  (a) by the issue or transfer to the issuing company of equity shares in the other company; or
  (b) by the cancellation of any equity shares in the other company not held by the issuing company.

(2) Any excess of the value of the equity shares acquired or cancelled under the arrangement over the subscribed capital of the other company attributable to those shares may be disregarded when recording as share capital of the issuing company the amount of consideration for the issue by the issuing company of its shares. Consequently, the minimum amount of consideration required to be recorded as share capital of the issuing company in respect of the shares issued under the arrangement is the subscribed capital of the other company attributable to the equity shares acquired or cancelled.

(3) If the arrangement also provides for the issue of any shares in the issuing company on terms that the consideration for those shares is to be provided
  (a) by the issue or transfer to the issuing company of nonequity shares in the other company; or
  (b) by the cancellation of any non-equity shares in the other company not held by the issuing company, any excess of the value of the non-equity shares acquired or cancelled under the arrangement over the subscribed capital of the other company attributable to those shares may be disregarded when recording as share capital of the issuing company the amount of consideration for the issue by the issuing company of its shares.

(4) This section does not apply in a case falling within section 195.

Section:

197

Merger relief: meaning of 90% equity holding

(1) This section has effect in determining, for the purposes of section 196, whether a company (company A) has secured at least a 90% equity holding in another company (company B) under an arrangement mentioned in section 196(1).

(2) Company A has secured at least a 90% equity holding in company B if, in consequence of an acquisition or cancellation of equity shares in company B under that arrangement, company A holds in aggregate 90% or more of the equity shares in company B (whether or not all or any of the equity shares in company B held by company A were acquired under that arrangement).

(3) If the equity shares in company B are divided into different classes of shares, company A is not regarded as having secured at least a 90% equity holding in company B unless the requirements of subsection (2) are met in relation to each of those classes of shares taken separately.

(4) For the purposes of this section, the following shares are regarded as held by company A
  (a) shares held by a company that is company A's holding company or subsidiary; (b) shares held by a subsidiary of company A's holding company; and
  (c) shares held by nominees of company A or of a company referred to in paragraph (a) or (b).

Section:

198

Relief may be reflected in company’s statement of financial position

An amount corresponding to the amount that, because of this Subdivision, is not required to be recorded as a company's share capital may also be disregarded in determining the amount at which any shares or other consideration provided for the shares issued is to be included in the company's statement of financial position.

Section:

199

Regulations

(1) The Financial Secretary may make regulations for restricting or otherwise modifying the relief provided by this
Subdivision.

(2) Regulations made under this section are subject to the approval of the Legislative Council.

Subdivision:2

Miscellaneous

Section:

200

Provision for different amounts to be paid on shares

If authorized by its articles to do so, a company may
  (a) make arrangements on the issue of shares for a difference between the shareholders in the amounts and times of payment of calls on their shares;
  (b) accept from any member the whole or part of the amount remaining unpaid on any shares held by the member, although no part of that amount has been called up; and
  (c) pay a dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others.

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