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香港新会社条例(第622章) 401~500条

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

Section:

401

Copies of written resolution for appointment must be sent to new and old auditors

(1) This section applies if an appointment of an auditor specified in subsection (2) is proposed to be effected by a written resolution of the members of a company.

(2) The appointment is
  (a) an appointment under section 396(1), (3) or (5) of a person in place of a specified incumbent; or
  (b) an appointment under section 396(1), (3) or (5) of a specified incumbent who holds office by virtue of an appointment under section 397(1) or (2) to fill a casual vacancy caused by a resignation.

(3) On receipt of a copy of the proposed resolution, the company must send a copy of it
  (a) to the person proposed to be appointed as auditor; and
  (b) in the case of
    (i) subsection (2)(a), to the specified incumbent; or
    (ii) subsection (2)(b), to the person who resigned.

(4) If a company contravenes subsection (3), the written resolution is ineffective.

(5) In this section
specified incumbent(指明在任人) means
  (a) the person who is the last auditor of the company and whose term of office as auditor has expired; or
  (b) the person whose term of office as auditor will expire at the end of the appointment period in relation to the financial year concerned.

Section:

402

Terms of office of auditor

(1) A person appointed as auditor of a company holds office in accordance with the terms of the appointment.

(2) Despite subsection (1)
  (a) a person appointed as auditor of a company does not take office until the previous auditor's appointment is terminated; and
  (b) a person appointed as auditor of a company for a financial year under section 395, 396, 397 or 398 holds office until
    (i) if the company holds an annual general meeting in accordance with section 610 in respect of the financial year, the end of the annual general meeting;
    (ii) if, by virtue of section 612(1), the company does not hold an annual general meeting in accordance with section 610 in respect of the financial year, the date of the written resolution passed for the purposes of section 612(1); or
    (iii) if, by virtue of section 612(2), the company does not hold an annual general meeting in accordance with section 610 in respect of the financial year, the end of the appointment period in relation to the next financial year.

Section:

403

Person deemed to be reappointed as auditor

(1) If
  (a) by virtue of section 612(2), a company is not required to hold an annual general meeting in accordance with section 610 in respect of a financial year; and
  (b) at the end of the appointment period in relation to the next financial year, no person has been appointed as auditor of the company for that next financial year, the person who is the auditor of the company as at the end of that appointment period is deemed to be reappointed, at that time, as auditor of the company for that next financial year on the same terms of appointment.

(2) Despite subsection (1), the person is not deemed to be reappointed as auditor of the company for the next financial year if
  (a) the person was appointed as auditor under section 395 or 397(1);
  (b) the company's articles require an actual appointment;
  (c) before the person is deemed to be reappointed under that subsection, the members have by a resolution passed at a general meeting resolved that the person should not be reappointed as auditor for that next financial year;
  (d) the person declines the reappointment in a written notice sent to the company at least 14 days before the end of the appointment period in relation to that next financial year; or
  (e) members representing at least the requisite percentage of the voting rights of all the members who would be entitled to vote on a resolution that the person should not be reappointed give the company a notice complying with subsection (5).

(3) Special notice is required for a resolution proposed for the purposes of subsection (2)(c).

Note

See also section 578 which sets out the requirements regarding special notice.

(4) On receipt of a special notice, the company must send a copy of it to the person proposed not to be reappointed.

(5) A notice for the purposes of subsection (2)(e)
  (a) must state that the person should not be reappointed;
  (b) must be authenticated by the member or members giving it;
  (c) must be delivered to the company in hard copy form or electronic form; and
  (d) must be received by the company before the end of the accounting reference period immediately preceding the time when the reappointment would have effect.

(6) This section does not affect the operation of Subdivision 6.

(7) In ascertaining the amount of any compensation or damages payable to a person on ceasing to hold office of auditor for any reason, no account is to be taken of any loss of the opportunity of being deemed to be reappointed as auditor under this section.

(8) In this section
requisite percentage(所需百分比) means 5%, or a lower percentage specified for the purposes of this section in the company's articles.

Section:

404

Auditor’s remuneration

(1) The remuneration of an auditor of a company appointed by the members may be fixed
  (a) by a resolution passed at a general meeting; or
  (b) in the manner specified in such a resolution.

(2) The remuneration of an auditor of a company appointed by the directors
  (a) may be fixed by the directors when making the appointment; or
  (b) if it has not been fixed by the directors, may be fixed
    (i) by a resolution passed at a general meeting; or
    (ii) in the manner specified in such a resolution.

(3) The remuneration of an auditor of a company appointed by the Court
  (a) may be fixed by the Court when making the appointment; or
  (b) if it has not been fixed by the Court, may be fixed
    (i) by a resolution passed at a general meeting; or
    (ii) in the manner specified in such a resolution.

(4) In this section
remuneration(酬金), in relation to an auditor of a company, includes any sum paid by the company in respect of the expenses of the auditor.

Subdivision:3

Auditor’s Report

Section:

405

Auditor’s duty to report

A company's auditor must prepare a report for the members on any financial statements prepared by the directors, a copy of which is laid before the company in general meeting under section 429, or is sent to a member under section 430 or otherwise circulated, published or issued by the company, during the auditor's term of office.

Section:

406

Auditor’s opinion on financial statements, directors’ report, etc.

(1) An auditor's report must state, in the auditor's opinion
  (a) whether the financial statements have been properly prepared in compliance with this Ordinance; and
  (b) in particular, whether the financial statements
    (i) in the case of annual financial statements of a company that does not fall within the reporting exemption for the financial year, give a true and fair view of the financial position and financial performance of the company as required by section 380; or
    (ii) in the case of annual consolidated financial statements of a company that does not fall within the reporting exemption for the financial year, give a true and fair view of the financial position and financial performance of the company and all the subsidiary undertakings as required by section 380.

(2) If a company's auditor is of the opinion that the information in a directors' report for a financial year is not consistent with the financial statements for the financial year, the auditor
  (a) must state that opinion in the auditor's report; and
  (b) may bring that opinion to the members' attention at a general meeting.

Section:

407

Auditor’s opinion on other matters

(1) In preparing an auditor's report, the auditor must carry out an investigation that will enable the auditor to form an opinion as to
  (a) whether adequate accounting records have been kept by the company; and
  (b) whether the financial statements are in agreement with the accounting records.

(2) A company's auditor must state the auditor's opinion in the auditor's report if the auditor is of the opinion that
  (a) adequate accounting records have not been kept by the company; or
  (b) the financial statements are not in agreement with the accounting records in any material respect.

(3) If a company's auditor fails to obtain all the information or explanations that, to the best of the auditor's knowledge and belief, are necessary and material for the purpose of the audit, the auditor must state that fact in the auditor's report.

(4) If the financial statements do not comply with section 383(1), the auditor must include in the auditor's report, so far as the auditor is reasonably able to do so, a statement giving the particulars that are required to be, but have not been, contained in the financial statements.

Section:

408

Offences relating to contents of auditor’s report

(1) Every person specified in subsection (2) commits an offence if the person knowingly or recklessly causes a statement required to be contained in an auditor's report under section 407(2)(b) or (3) to be omitted from the report.

(2) The persons are
  (a) if the auditor who prepares the auditor's report is a natural person
    (i) the auditor; and
    (ii) every employee and agent of the auditor who is eligible for appointment as auditor of the company;
  (b) if the auditor who prepares the auditor's report is a firm, every partner, employee and agent of the auditor who is eligible for appointment as auditor of the company; or
  (c) if the auditor who prepares the auditor's report is a body corporate, every officer, member, employee and agent of the auditor who is eligible for appointment as auditor of the company.

(3) A person who commits an offence under subsection (1) is liable to a fine of $150000.

Section:

409

Auditor’s reports to be signed

(1) An auditor's report must be signed
  (a) if the auditor is a natural person, by the auditor; or
  (b) if the auditor is a firm or body corporate, by a natural person authorized to sign the auditor's name on the auditor's behalf.

(2) An auditor's report must state the auditor's name.

(3) Every copy of an auditor's report laid before a company in general meeting under section 429, or sent to a member under section 430 or otherwise circulated, published or issued by the company, must state the auditor's name.

(4) If subsection (3) is contravened, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4.

Subdivision:4

Auditor’s Rights and Privileges, etc.

Section:

410

Qualified privileges

(1) In the absence of malice, an auditor of a company is not liable to any action for defamation at the suit of any person in respect of any statement made by the auditor in the course of performing duties as auditor of the company.

(2) In the absence of malice, a person is not liable to any action for defamation at the suit of any person in respect of the publication of any document
  (a) prepared by an auditor of a company in the course of performing duties as auditor of the company; and
  (b) required by this Ordinance
    (i) to be delivered to the Registrar; or
    (ii) to be sent to any member of the company or any other person.

(3) This section does not limit or affect any other right, privilege or immunity that an auditor of a company, or any other person, has as defendant in an action for defamation.

(4) In this section, a reference to performing duties as auditor of a company includes
  (a) making a cessation statement, giving the statement to the company, and requesting the company to comply with the requirement specified in section 422(5) in relation to the statement; and
  (b) making a statement of circumstances, and giving the statement to the company.

Section:

411

Rights in relation to general meeting

(1) A person appointed as auditor of a company is entitled
  (a) to attend any of the company's general meetings; and
  (b) to be heard, at any of the company's general meetings, on any part of the business of the meeting that concerns the person as auditor of the company.

(2) A person's entitlement under subsection (1)(a) or (b) is, if the person is a firm or body corporate, exercisable by a natural person authorized by the person to act as the person's representative at the meeting.

Section:

412

Rights in relation to information

(1) An auditor of a company has a right of access to the company's accounting records.

(2) An auditor of a company may require a person that is a related entity of the company, or was a related entity of the company at the time to which the information or explanation relates, to provide the auditor with any information or explanation that the auditor reasonably requires for the performance of the duties as auditor of the company.

(3) If an auditor has required a person to provide any information or explanation under subsection (2), the person must provide the information or explanation as soon as practicable after being required.

(4) If a subsidiary undertaking of a company is not a company incorporated in Hong Kong, an auditor of the company may require the company to obtain from any of the persons specified in subsection (5) any information or explanation that the auditor reasonably requires for the performance of the duties as auditor of the company.

(5) The persons are
  (a) the subsidiary undertaking;
  (b) a person who
    (i) is an officer or auditor of the subsidiary undertaking; or
    (ii) was an officer or auditor of the subsidiary undertaking at the time to which the information or explanation relates; and
  (c) a person who
    (i) holds or is accountable for any of the subsidiary undertaking's accounting records; or
    (ii) held or was accountable for the subsidiary undertaking's accounting records at the time to which the information or explanation relates.

(6) If an auditor has required a company to obtain any information or explanation from a person under subsection (4), the company must take all reasonable steps to obtain the information or explanation as soon as practicable after being required.

(7) A statement made by a person in response to a requirement under subsection (2) or (4) may not be used in evidence against the person in any criminal proceedings except proceedings for an offence under section 413.

(8) This section does not compel a person to disclose information in respect of which a claim to legal professional privilege could be maintained in legal proceedings.

(9) In this section
related entity(有關連實體), in relation to a company, means
  (a) an officer of the company;
  (b) a subsidiary undertaking of the company that is a company incorporated in Hong Kong;
  (c) an officer or auditor of such a subsidiary undertaking; or
  (d) a person holding or accountable for any of the accounting records of the company or such a subsidiary undertaking.

Section:

413

Offences relating to section 412

(1) A person who contravenes section 412(3) commits an offence and 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.

(2) If a person is charged with an offence under subsection (1), it is a defence to establish that it was not reasonably practicable for the person to provide the information or explanation.

(3) A person commits an offence if
  (a) the person makes a statement to an auditor of a company that conveys or purports to convey any information or explanation that the auditor requires, or is entitled to require, under section 412(2) or (4);
  (b) the statement is misleading, false or deceptive in a material particular; and
  (c) the person knows that, or is reckless as to whether or not, the statement is misleading, false or deceptive in a material particular.

(4) A person who commits an offence under subsection (3) is liable
  (a) on conviction on indictment to a fine of $150000 and to imprisonment for 2 years; or
  (b) on summary conviction to a fine at level 5 and to imprisonment for 6 months.

(5) If a company contravenes section 412(6), 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.

(6) If a person is charged with an offence under subsection (5) for failing to obtain any information or explanation from a subsidiary undertaking or another person, it is a defence to establish that
  (a) it would be an offence under the law of a place outside Hong Kong for the subsidiary undertaking or that other person to provide the information or explanation to the defendant; and
  (b) the subsidiary undertaking or that other person did not provide the information or explanation to the defendant on that ground.

(7) This section does not affect an auditor's right to apply for an injunction to enforce any of the auditor's rights under section 412.

Section:

414

Auditor may provide information to incoming auditor without contravening duties

(1) A person who is or has been an auditor of a company does not contravene any duty owed by the person as such auditor in law by reason only that the person gives workrelated information to another person
  (a) who is an auditor of the company;
  (b) who has been appointed as auditor of the company but whose term of office has not yet begun; or
  (c) to whom the company has offered the position as auditor but who has not yet been appointed.

(2) Subsection (1) does not apply unless the person who gives work-related information to another person
  (a) does so in good faith; and
  (b) reasonably believes that the information is relevant to the performance of that other person's duties as auditor of the company.

(3) In this section
work-related information(工作資料), in relation to a person who is or has been an auditor of a company, means information of which the person became aware in the capacity of auditor.

Subdivision:5

Auditor’s Liability

Section:

415

Avoidance of provisions protecting auditor from liability

(1) This section applies to a provision contained in a company's articles, or in a contract entered into by a company, or otherwise.

(2) If a provision purports to exempt an auditor of the company from any liability that would otherwise attach to the sauditor in connection with any negligence, default, breach of duty or breach of trust occurring in the course of performance of the duties as auditor in relation to the company, the provision is void.

(3) If, by a provision, the company directly or indirectly provides an indemnity for an auditor of the company, or an auditor of an associated company of the company, against any liability attaching to the auditor in connection with any negligence, default, breach of duty or breach of trust occurring in the course of performance of the duties as auditor in relation to the company or associated company (as the case may be), the provision is void.

(4) Subsection (3) does not prevent a company from taking out and keeping in force insurance for an auditor of the company, or an auditor of an associated company of the company, against
  (a) any liability to any person attaching to the auditor in connection with any negligence, default, breach of duty or breach of trust (except for fraud) occurring in the course of performance of the duties of auditor in relation to the company or associated company (as the case may be); or
  (b) any liability incurred by the auditor in defending any proceedings (whether civil or criminal) taken against the auditor for any negligence, default, breach of duty or breach of trust (including fraud) occurring in the course of performance of the duties of auditor in relation to the company or associated company (as the case may be).

(5) Subsection (3) does not prevent a company from indemnifying an auditor of the company against any liability incurred by the auditor
  (a) in defending any proceedings (whether civil or criminal) in which judgment is given in the auditor's favour or the auditor is acquitted; or
  (b) in connection with an application under section 903 or 904 in which relief is granted to the auditor by the Court.

(6) In this section, a reference to performance of the duties of auditor includes
  (a) making a cessation statement, giving the statement to the company, and requesting the company to comply with the requirement specified in section 422(5) in relation to the statement; and
  (b) making a statement of circumstances, and giving the statement to the company.

Subdivision:6

Termination of Auditor’s Appointment

Section:

416

Short title and commencement

(1) A person's appointment as auditor of a company is terminated if
  (a) the term of office expires;
  (b) the person resigns from office under section 417(1);
  (c) the person ceases to be auditor under section 418;
  (d) the person is removed from office under section 419(1); or
  (e) a winding up order is made in respect of the company.

(2) Where a firm is appointed, by the firm name, as auditor of a company, the appointment is also terminated if every person who is regarded as being appointed as auditor by virtue of section 399
  (a) ceases to be a partner in the firm before the term of office expires; or
  (b) ceases to be eligible, or becomes disqualified, for appointment as auditor of the company under Subdivision 2 before the term of office expires.

(3) Where a body corporate is appointed as auditor of a company, the appointment is also terminated if the body corporate is dissolved.

(4) If 2 or more persons are appointed as auditor of a company, and the appointment of any of the persons is terminated, the termination does not affect the appointment of the other person.

Section:

417

Resignation of auditor

(1) A person may resign from the office of auditor by giving the company a notice in writing that is accompanied by a statement required to be given under section 424.

(2) Such a person's term of office expires
  (a) at the end of the day on which notice is given to the company under subsection (1); or
  (b) if the notice specifies a time on a later day for the purpose, at that time.

(3) Within 15 days beginning on the date on which a company receives a notice of resignation, the company must deliver a notification in the specified form of that fact to the Registrar for registration.

(4) If a company contravenes subsection (3), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5 and to imprisonment for 6 months and, in the case of a continuing offence, to a further fine of $1000 for each day during which the offence continues.

Section:

418

Cessation of office

(1) If, while holding office as auditor of a company, a person ceases to be eligible, or becomes disqualified, for appointment as auditor of the company under Subdivision 2, the person
  (a) immediately ceases to be auditor of the company; and
  (b) must notify the company of the cessation in writing within 14 days from the date of the cessation.

(2) A person who contravenes subsection (1)(b) commits an offence and is liable to a fine at level 4.

(3) If a person is charged with an offence under subsection (2), it is a defence to establish that the person did not know, and had no reason to believe, that the person had ceased to be eligible, or had become disqualified, for appointment as auditor of the company under Subdivision 2.

Section:

419

Company may remove auditor

(1) A company may by an ordinary resolution passed at a general meeting remove a person from the office of auditor despite
  (a) any agreement between the person and the company; or
  (b) anything in the company's articles.

(2) Special notice is required for an ordinary resolution proposed for the purposes of subsection (1).

Note

See also section 578 which sets out the requirements regarding special notice.

(3) On receipt of a special notice, the company must send a copy of it to the person proposed to be removed.

(4) If an ordinary resolution for the removal is passed, the company must deliver a notice in the specified form of that fact to the Registrar for registration within 15 days beginning on the date on which it is passed.

(5) If a company contravenes subsection (4), 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:

420

Removed auditor not deprived of compensation, damages, etc.

Section 419 does not deprive a person of compensation or damages payable to the person in respect of the person ceasing
  (a) to hold office as auditor of a company; or
  (b) to hold any appointment that is terminated with the termination of the person's appointment as auditor.

Subdivision:7

Outgoing Auditor’s Right to Requisition Meeting of Company and Make Representation

Section:

421

Resigning auditor may requisition meeting

(1) If a person gives under section 417(1) a notice of resignation that is accompanied by a statement of circumstances given under section 424(a), the person may, by another notice given to the company with the notice of resignation, require the directors to convene a general meeting of the company for receiving and considering the explanation of the circumstances connected with the resignation that the person places before the meeting.

(2) Within 21 days beginning on the date on which the company receives that other notice, the directors must convene a general meeting for a date falling within 28 days after the date on which the notice convening the meeting is given.

(3) If the directors of a company contravene subsection (2), every director who failed to take all reasonable steps to secure that a general meeting was convened as required by that subsection commits an offence and is liable
  (a) on conviction on indictment to a fine of $150000 and to imprisonment for 2 years; or
  (b) on summary conviction to a fine at level 5 and to imprisonment for 6 months.

Section:

422

Cessation statement in relation to, and attendance at, general meeting

(1) If a general meeting is convened under section 421(2), the person who resigns from the office of auditor
  (a) may give the company a statement by the person that sets out in reasonable length the circumstances surrounding the resignation;
  (b) may request the company to comply with the requirement specified in subsection (5) in relation to the statement; and
  (c) is entitled
    (i) to be given every notice of, and every other item of communication, relating to the general meeting, that a member of the company is entitled to be given;
    (ii) to attend the general meeting; and
    (iii) to be heard at the general meeting on any part of the business of the meeting that concerns the person as auditor or former auditor of the company.

(2) If special notice is given under section 400(1)(a) for a resolution for appointing a person as auditor in place of another person, that other person
  (a) may give the company a statement by that other person that sets out in reasonable length the circumstances surrounding the termination of the appointment as auditor;
  (b) may request the company to comply with the requirement specified in subsection (5) in relation to the statement; and
  (c) is entitled
    (i) to be given every notice of, and every other item of communication, relating to the general meeting, that a member of the company is entitled to be given;
    (ii) to attend the general meeting; and
    (iii) to be heard at the general meeting on any part of the business of the meeting that concerns the person as auditor or former auditor of the company.

(3) If special notice is given under section 419(2) for an ordinary resolution for removing a person from the office of auditor, the person
  (a) may give the company a statement by the person that sets out in reasonable length the circumstances surrounding the proposed removal; and
  (b) may request the company to comply with the requirement specified in subsection (5) in relation to the statement.

(4) A person's entitlement under subsection (1)(c)(ii) or (iii) or (2)(c)(ii) or (iii) is, if the person is a firm or body corporate, exercisable by a natural person authorized by the person to act as the person's representative at the meeting.

(5) The requirement specified for the purposes of subsection (1)(b), (2)(b) or (3)(b) is
  (a) if the company receives the statement on a date that is more than 2 days before the last day on which notice may be given under section 571(1) to call the general meeting, the requirement
    (i) to state, in every notice of the meeting given to the members, that the statement has been made; and
    (ii) to send a copy of the statement to every member to whom a notice of the meeting is or has been given; or
  (b) if the company has not sent a copy of the statement to every member to whom a notice of the meeting is or has been given, the requirement to ensure that the statement is read out at the meeting.

(6) Unless exempted by an order under subsection (7), the company must comply with a request made under subsection (1)(b), (2)(b) or (3)(b).

(7) On application by the company or by anyone who claims to be aggrieved, the Court may order that the company is exempted from complying with the request, if it is satisfied that the person who has given a statement and made a request under subsection (1)(a) and (b), (2)(a) and (b) or (3)
  (a) has abused the right to do so; or
  (b) has used such a right to secure needless publicity for defamatory matter.

(8) If a company contravenes subsection (6), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5.

Section:

423

Cessation statement in relation to written resolution

(1) This section applies if a company sends a copy of a written resolution to a person under section 401(3)(b)(i).

(2) The person may, within 14 days after receiving a copy of the written resolution from the company
  (a) give the company a statement by the person that sets out in reasonable length the circumstances surrounding the termination of the appointment as auditor; and
  (b) require the company to send a copy of the statement to every member at the same time when the written resolution is circulated under section 550 or 552.

(3) Section 553 applies to the circulation of the written resolution as if the reference to 21 days in section 553(3) were replaced by a reference to 28 days.

(4) Unless exempted by an order under subsection (5), the company must comply with a requirement made under subsection (2)(b).

(5) On application by the company or by anyone who claims to be aggrieved, the Court may order that the company is exempted from complying with the requirement, if it is satisfied that the person who has given a statement and made a requirement under subsection (2)
  (a) has abused the right to do so; or
  (b) has used such a right to secure needless publicity for defamatory matter.

(6) If a company contravenes subsection (4), the written resolution is ineffective.

Subdivision:8

Outgoing Auditor’s Statement of Circumstances

Section:

424

Duty of resigning auditor to give statement

A person who resigns from office under section 417(1) must, on the resignation, give the company
  (a) if the person considers that there are circumstances connected with the resignation that should be brought to the attention of the company's members or creditors, a statement of those circumstances; or
  (b) if the person considers that there are no such circumstances, a statement to that effect.

Section:

425

Duty of auditor who retires or is removed to give statement

(1) Subject to subsection (3), a person whose appointment as auditor is terminated under section 416(1)(a) or (d) must, on the termination, give the company
  (a) if the person considers that there are circumstances connected with the termination that should be brought to the attention of the company's members or creditors, a statement of those circumstances; or
  (b) if the person considers that there are no such circumstances, a statement to that effect.

(2) Such a person must send a statement mentioned in subsection (1) to the company so that it will be received by the company
  (a) where the person's term of office expires because the person is not deemed to be reappointed as auditor under section 403(2)(d), at least 14 days before the end of the appointment period in relation to the next financial year; or
  (b) in any other case, within 14 days beginning on the date of termination.

(3) Subsection (1) does not apply if
  (a) the person's appointment is terminated under section 416(1)(a); and
  (b) the person
    (i) is appointed as auditor of the company for a term immediately following the term of office that expires; or
    (ii) is deemed by section 403 to be reappointed as auditor of the company for the next financial year.

(4) A person who contravenes subsection (1) or (2) commits an offence and 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.

(5) If a person is charged with an offence under subsection (4), it is a defence to establish that the person took all reasonable steps to secure compliance with subsection (1) or (2) (as the case may be).

Section:

426

Company’s and aggrieved person’s responses to statement of circumstances

(1) If a company is given a statement of circumstances, the company must, within 14 days beginning on the date on which it receives the statement
  (a) send a copy of the statement to every member of the company; or
  (b) apply to the Court for an order directing that copies of the statement are not to be sent under paragraph (a).

(2) If a company makes an application under subsection (1)(b), it must give notice of the application to the person who has given the statement of circumstances to the company.

(3) A person who claims to be aggrieved by a statement of circumstances may, within 14 days beginning on the date on which the company receives the statement, apply to the Court for an order directing that copies of the statement are not to be sent under subsection (1)(a).

(4) If a person makes an application under subsection (3), the person must give notice of the application to
  (a) the company; and
  (b) the person who has given the statement of circumstances to the company.

(5) If
  (a) a person gives a company a statement of circumstances; and
  (b) within 21 days beginning on the date on which the company receives the statement, the person has not received notice of an application under subsection (2) or (4),
the person must within the next 7 days deliver a copy of the statement to the Registrar for registration.

(6) If a company contravenes subsection (1), the company, and every responsible person of the company, commit an offence, and each is liable
  (a) on conviction on indictment to a fine of $150000 and to imprisonment for 2 years; or
  (b) on summary conviction to a fine at level 5 and to imprisonment for 6 months.

(7) If a person contravenes subsection (5), the person commits an offence and 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.

(8) If a person is charged with an offence under subsection (7), it is a defence to establish that the person took all reasonable steps to secure compliance with subsection (5).

Section:

427

Court may order statement of circumstances not to be sent

(1) This section applies if an application has been made under section 426(1)(b) or (3) in relation to a statement of circumstances given by a person to a company.

(2) If the Court is satisfied that the person has abused the use of the statement of circumstances or is using the statement to secure needless publicity for defamatory matter, the Court
  (a) must direct that copies of the statement are not to be sent under section 426(1)(a); and
  (b) may order the person, though not a party to the application, to pay the applicant's costs on the application in whole or in part.

(3) If the Court gives directions under subsection (2)(a), the company must, within 15 days beginning on the date on which the directions are given
  (a) send a notice setting out the effect of the directions to
    (i) every member of the company; and
    (ii) unless already named as a party to the proceedings, the person who has given the statement of circumstances to the company; and
  (b) deliver a copy of the notice to the Registrar for registration.

(4) If the Court decides not to grant the application, the company must, within 15 days beginning on the date on which the decision is made or on which the proceedings are discontinued for any reason
  (a) give notice of the decision to the person who has given the statement of circumstances to the company; and
  (b) send a copy of the statement of circumstances to every member of the company and to that person.

(5) Within 7 days beginning on the date on which a person receives a notice under subsection (4)(a), the person must deliver a copy of the statement of circumstances to the Registrar for registration.

Section:

428

Offences relating to section 427

(1) If a company contravenes section 427(3) or (4), the company, and every responsible person of the company, commit an offence, and each is liable
  (a) on conviction on indictment to a fine of $150000 and to imprisonment for 2 years; or
  (b) on summary conviction to a fine at level 5 and to imprisonment for 6 months.

(2) A person who contravenes section 427(5) commits an offence and 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) If a person is charged with an offence under subsection (2) for contravening section 427(5), it is a defence to establish that the person took all reasonable steps to secure compliance with that section.

Division:6

Laying and Publication of Financial Statements and Report

Section:

429

Directors must lay financial statements etc. before company in general meeting

(1) A company's directors must, in respect of each financial year, lay before the company in annual general meeting, or in any other general meeting directed by the Court, a copy of the reporting documents for the financial year within the period specified in section 431.

(2) Subsection (1) does not apply in relation to a financial year in respect of which an annual general meeting is not required to be held under section 612.

(3) A director of a company who fails to take all reasonable steps to secure compliance with subsection (1) commits an offence and is liable to a fine of $300,000.

(4) A director of a company who wilfully fails to take all reasonable steps to secure compliance with subsection (1) commits an offence and is liable to a fine of $300000 and to imprisonment for 12 months.

(5) If a person is charged with an offence under subsection (3)
  (a) it is a defence to establish that the person had reasonable grounds to believe, and did believe, that a competent and reliable person
    (i) was charged with the duty of ensuring that subsection (1) was complied with; and
    (ii) was in a position to discharge that duty; and
  (b) it is not a defence to establish that the financial statements or report was not in fact prepared as required by this Ordinance.

Section:

430

Company must send copies of financial statements etc. to members before general meeting

(1) If a company is required to hold an annual general meeting in accordance with section 610 in respect of a financial year, the company must send a copy of the reporting documents for the financial year to every member at least 21 days before the date of the meeting at which the copy is required by section 429 to be laid.

(2) For the purposes of subsection (1), even though a copy of the reporting documents for the financial year is sent to a member less than 21 days before the date of the meeting at which the copy is required by section 429 to be laid, the copy is to be regarded as having been sent to the member at least 21 days before that date if so agreed by all members entitled to attend and vote at that meeting.

(3) If, by virtue of section 612(2), a company is not required to hold an annual general meeting in accordance with section 610 in respect of a financial year, the company must send a copy of the reporting documents for the financial year to every member within the period specified in section 431.

(4) For the purposes of section 833(3)(c), a notification is to be sent
  (a) in the case of subsection (1), at least 21 days before the date of the general meeting at which a copy of the reporting documents is required by section 429 to be laid; or
  (b) in the case of subsection (3), at least 21 days before the date on which a copy of the reporting documents is sent to every member under that subsection.

(5) The period specified for the purposes of section 833(3)(d)(i) is
  (a) in the case of subsection (1), the period beginning at least 21 days before the date of the general meeting at which a copy of the reporting documents is required by section 429 to be laid and ending on the date of that meeting; or
  (b) in the case of subsection (3), the period of 21 days after the date on which a notification under section 833(3)(c) is sent.

(6) If a copy or copies of the reporting documents are sent under this section over a period of days, the copy or copies are to be regarded as having been sent on the last day of the period for the purpose of a reference in this Ordinance to the day on which the copy or copies are sent under this section.

Section:

431

Period for laying and sending financial statements etc.

(1) Subject to subsection (2), the period specified for the purposes of sections 429(1) and 430(3) is
  (a) where the company is a private company described in subsection (3), or a company limited by guarantee, at the end of the accounting reference period by reference to which the financial year is determined
    (i) subject to subparagraph (ii), the period of 9 months, or any longer period directed by the Court, after the end of that accounting reference period; or
    (ii) if that accounting reference period is the company's first accounting reference period and is longer than 12 months, whichever of the periods set out in subsection (4)(a) and (b) expires last; or
  (b) where the company is neither a private company described in subsection (3), nor a company limited by guarantee, at the end of that accounting reference period
    (i) subject to subparagraph (ii), the period of 6 months, or any longer period directed by the Court, after the end of that accounting reference period; or
    (ii) if that accounting reference period is the company's first accounting reference period and is longer than 12 months, whichever of the periods set out in subsection (5)(a) and (b) expires last.

(2) If, after a new accounting reference date is specified under section 371(1), the accounting reference period by reference to which the financial year is determined is shortened, the period specified for the purposes of section 429(1) and 430(3) is whichever of the following expires last
  (a) the period specified in subsection (1);
  (b) the period of 3 months after the date of the directors' resolution.

(3) For the purposes of subsection (1)(a) or (b), the private company is one that is not a subsidiary of a public company at any time during the financial year.

(4) The periods set out for the purposes of subsection (1)(a)(ii) are
  (a) the period of 9 months, or any longer period directed by the Court, after the first anniversary of the company's incorporation; and
  (b) the period of 3 months after the end of the accounting reference period by reference to which the financial year is determined.

(5) The periods set out for the purposes of subsection (1)(b)(ii) are
  (a) the period of 6 months, or any longer period directed by the Court, after the first anniversary of the company's incorporation; and
  (b) the period of 3 months after the end of the accounting reference period by reference to which the financial year is determined.

Section:

432

Exception to section 430

(1) Section 430 does not require a company to send a copy of any document to a member whose address is unknown to the company.

(2) Section 430 does not require a company to send a copy of any document
  (a) in the case of joint holders of shares none of whom is entitled to receive notices of the company's general meeting, to more than one of the holders; or
  (b) in the case of joint holders of shares some of whom are so entitled and some not, to those who are not entitled.

(3) Section 430 does not require a company to send a copy of any document to a member if the company has sent the member a copy of the summary financial report for the financial year under section 441, or in compliance with a request under section 444.

(4) If a company does not have a share capital, section 430 does not require the company to send a copy of any document to a member who is not entitled to receive notice of general meeting of the company.

Section:

433

Offences relating to section 430

(1) If a company contravenes section 430(1), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5.

(2) If a company contravenes section 430(3), the company, and every responsible person of the company, commit an offence, and each is liable to a fine of $300,000.

(3) If a company wilfully contravenes section 430(3), the company, and every responsible person of the company, commit an offence, and each is liable to a fine of $300000 and to imprisonment for 12 months.

(4) If a person is charged with an offence under subsection (1) or (2), it is not a defence to establish that the financial statements or report was not in fact prepared as required by this Ordinance.

Section:

434

Company must send to non-voting members other documents

(1) A company must, at the same time when it sends a copy of the reporting documents under section 430, send to every member who is not entitled to vote at a general meeting of the company
  (a) a copy of any document issued by the company and circulated by the company with a copy of the reporting documents under section 430; and
  (b) a copy of any other document intended for the purpose of providing information about the company's affairs that is so circulated.

(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 5.

Section:

435

Company must send copies of financial statements etc. to members and others on demand

(1) Within 7 days after a demand is made by a member or a member's personal representative, a company must send to the member or personal representative
  (a) one copy of the latest financial statements;
  (b) one copy of the latest directors' report; or
  (c) one copy of the auditor's report on those latest financial statements.

(2) A copy of a document that a person is entitled to be sent under subsection (1) is in addition to any copy of the document that the person is entitled to be sent under section 430.

(3) 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 5 and, in the case of a continuing offence, to a further fine of $1000 for each day during which the offence continues.

(4) If a person is charged with an offence under subsection (3), it is a defence to establish that the member or member's personal representative (as the case may be) had previously made another demand for the document concerned and had been provided with a copy of the document.

Section:

436

Requirement in connection with publication of financial statements etc.

(1) This section applies if a company
  (a) circulates, publishes or issues
    (i) any specified financial statements in relation to the company; or
    (ii) any non-statutory accounts in relation to the company; or
  (b) otherwise makes such financial statements or accounts available for public inspection in a manner calculated to invite members of the public generally, or any class of them, to read the financial statements or accounts.

(2) The specified financial statements must be accompanied by the auditor's report on those statements.

(3) The non-statutory accounts must be accompanied by a statement indicating
  (a) that those accounts are not specified financial statements in relation to the company;
  (b) whether the specified financial statements for the financial year with which those accounts purport to deal have been delivered to the Registrar;
  (c) whether an auditor's report has been prepared on the specified financial statements for the financial year; and
  (d) whether the auditor's report
    (i) was qualified or otherwise modified;
    (ii) referred to any matter to which the auditor drew attention by way of emphasis without qualifying the report; or
    (iii) contained a statement under section 406(2) or 407(2) or (3).

(4) The non-statutory accounts must not be accompanied by any auditor 's report on the specified financial statements.

(5) If subsection (2), (3) or (4) is contravened, the company, and every responsible person of the company, commit an offence, and each is liable to a fine of $150,000.

(6) In this section
non-statutory accounts(非法定帳目), in relation to a company, means
  (a) any statement of financial position or statement of comprehensive income, otherwise than as part of any financial statements prepared by the directors, relating to, or purporting to deal with, a financial year of the company; or
  (b) accounts in any form, otherwise than as part of any financial statements prepared by the directors, purporting to be a statement of financial position or statement of comprehensive income for a group of companies consisting of the company and its subsidiary undertakings relating to, or purporting to deal with, a financial year of the company;
specified financial statements(指明財務報表), in relation to a company, means any financial statements prepared by the directors
  (a) a copy of which is required by section 429(1) to be laid before the company in general meeting; or
  (b) a copy of which is required by section 430(3) to be sent to every member or is otherwise circulated, published or issued by the company.

Division:7

Summary Financial Reports

Section:

437

Interpretation

In this Division
potential member (潛在成員) , in relation to a company, means a person who is entitled, whether conditionally or unconditionally, to become a member of the company.

Section:

438

Application of Division

This Division applies to a company in relation to a financial year if the company does not fall within the reporting exemption for the financial year.

Section:

439

Directors may prepare financial report in summary form

(1) The directors of a company may prepare for a financial year a financial report, in summary form, derived from the reporting documents for the financial year, a copy of which is required to be sent to every member of the company under section 430.

(2) A financial report prepared under subsection (1)
  (a) must contain the information prescribed by the Regulation; and
  (b) must comply with other requirements prescribed by the Regulation.

(3) If subsection (2) is contravened
  (a) a director who failed to take all reasonable steps to secure compliance with that subsection commits an offence and is liable to a fine of $300,000; and
  (b) a director who wilfully failed to take all reasonable steps to secure compliance with that subsection commits an offence and is liable to a fine of $300,000 and to imprisonment for 12 months.

(4) If a person is charged with an offence under subsection (3)(a), it is a defence to establish that the person had reasonable grounds to believe, and did believe, that a competent and reliable person
  (a) was charged with the duty of ensuring that subsection (2) was complied with; and
  (b) was in a position to discharge that duty.

Section:

440

Summary financial report to be approved and signed

(1) A summary financial report
  (a) must be approved by the directors; and
  (b) must be signed on the directors' behalf by a director.

(2) Every copy of a summary financial report sent to a member under this Division or otherwise circulated, published or issued by the company must state the name of the director who signed the report on the directors' behalf.

(3) If, as respect any summary financial report a copy of which is circulated, published or issued by the company, subsection (1) is contravened, the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 4.

(4) 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 4.

Section:

441

Company may send copy of summary financial report to member

(1) If a company is required to send a copy of the reporting documents for a financial year to a member under section 430, the company may send a copy of the summary financial report for the financial year (if any) to the member instead.

(2) If a company sends a copy of the summary financial report for a financial year to a member under subsection (1), the copy must be sent during the period within which a copy of the reporting documents for the financial year would be required to be sent to the member by the company under section 430.

Section:

442

Company may seek member’s intent on receiving summary financial report

(1) A company may notify every member or potential member to give the company a notice of intent under subsection (3).

(2) A notification to a member or potential member
  (a) must be given in writing; and
  (b) must be given in relation to a financial year.

(3) In response to a notification, a member or potential member may give the company a notice of intent to
  (a) request
    (i) either a copy of the reporting documents or a copy of the summary financial report; or
    (ii) none of those copies; and
  (b) in the case of paragraph (a)(i), request the copy to be sent by the company in hard copy form, in electronic form, or by making it available on a website.

(4) A member or potential member may only make a request under subsection (3)(b) in response to a notification for a copy of the reporting documents or a copy of the summary financial report to be sent in electronic form or by making it available on a website if the company has given, in the notification, the member or potential member an option to request the copy to be so sent.

(5) If a notice of intent is received by the company at least 28 days before the first date on which a copy of the reporting documents for the financial year is sent to a member under section 430, the notice of intent has effect in relation to that financial year, and every subsequent financial year, until it ceases to have effect by virtue of subsection (7).

(6) If a notice of intent is received by the company less than 28 days before the first date on which a copy of the reporting documents for the financial year is sent to a member under section 430
  (a) the notice of intent has effect in relation to every financial year subsequent to that financial year until it ceases to have effect by virtue of subsection (7); and
  (b) the member or potential member is to be regarded as
    (i) having requested a copy of the summary financial report for the financial year; and
    (ii) having requested the summary financial report to be sent by the company in hard copy form.

(7) A notice of intent ceases to have effect if the person who gave the notice
  (a) is no longer a member of the company; or
  (b) revokes the notice by giving the company a written notice of revocation.

(8) If a member or potential member does not give the company a notice of intent in response to a notification before the first date on which a copy of the reporting documents for the financial year is sent to a member under section 430, the member or potential member is to be regarded as
  (a) having requested a copy of the summary financial report for the financial year and every subsequent financial year; and
  (b) having requested the summary financial report to be sent by the company in hard copy form.

(9) Subsection (8) ceases to have effect in relation to a person if
  (a) the person is no longer a member of the company; or
  (b) the person gives the company a written notice of cessation of statutory election.

Section:

443

Notice of revocation and notice of cessation of statutory election

(1) A notice of revocation given by a person for the purposes of section 442(7)(b)
  (a) must state the financial year to which it relates;
  (b) must state that the notice of intent previously given by the person is revoked;
  (c) must state that the person requests
    (i) either a copy of the reporting documents or a copy of the summary financial report; or
    (ii) none of those copies; and
  (d) in the case of paragraph (c)(i), must state that the person requests the copy to be sent by the company in hard copy form, in electronic form, or by making it available on a website.

(2) The request stated in a notice of revocation under subsection (1)(c) must be different from the request stated in the notice of intent revoked by the notice of revocation.

(3) A notice of cessation of statutory election given by a person for the purposes of section 442(9)(b)
  (a) must state the financial year to which it relates;
  (b) must state that the person is no longer regarded as having made the requests mentioned in section 442(8);
  (c) must state that the person requests
    (i) either a copy of the reporting documents or a copy of the summary financial report; or
    (ii) none of those copies; and
  (d) in the case of paragraph (c)(i), must state that the person requests the copy to be sent by the company in hard copy form, in electronic form, or by making it available on a website.

(4) A person may only state in a notice of revocation under subsection (1)(d), or a notice of cessation of statutory election under subsection (3)(d), that the person requests for a copy of the reporting documents or a copy of the summary financial report to be sent in electronic form or by making it available on a website if the company has given, in the notification under section 442(1) to which the notice relates, the person an option to request the copy to be so sent.

(5) If a notice of revocation, or a notice of cessation of statutory election, is received by the company at least 28 days before the first date on which a copy of the reporting documents for the financial year to which the notice relates is sent to a member under section 430, the notice has effect in relation to that financial year, and every subsequent financial year.

(6) If a notice of revocation, or a notice of cessation of statutory election, is received by the company less than 28 days before the first date on which a copy of the reporting documents for the financial year to which the notice relates is sent to a member under section 430, the notice has effect in relation to every financial year subsequent to that financial year.

Section:

444

Company must comply with member’s request in notice of intent etc.

(1) If a person requests a copy of the reporting documents, or a copy of the summary financial report, in a relevant notice, the company must comply with the request unless it is prohibited from doing so by section 446.

(2) The request must be complied with during the period within which a copy of the reporting documents for the relevant financial year would be required to be sent to the person by the company under section 430.

(3) Subsection (1) does not require a company to comply with a potential member's request unless the potential member becomes a member of the company at least 28 days before the first date on which a copy of the reporting documents for the financial year is sent to a member under section 430(1) or (3).

(4) In this section
relevant financial year(有關財政年度) means the financial year in relation to which the relevant notice has effect under section 442 or 443;
relevant notice(有關通知) means
  (a) a notice of intent given under section 442(3);
  (b) a notice of revocation given for the purposes of section 442(7)(b); or
  (c) a notice of cessation of statutory election given for the purposes of section 442(9)(b).

Section:

445

Additional copy of reports etc. to be sent by comp

(1) If a company has sent a copy of the summary financial report for a financial year to a person under section 441, or in compliance with a request under section 444, the company must, at the person's request, send a copy of the reporting documents for the financial year to the person at the time specified in subsection (3).

(2) If a company has sent a copy of the reporting documents for a financial year to a person under section 430, the company must, at the person's request, send a copy of the summary financial report for the financial year to the person at the time specified in subsection (3) unless it is prohibited from doing so by section 446.

(3) The time specified for subsection (1) or (2) is
  (a) where a copy of the reporting documents for the financial year is to be laid before the company in general meeting under section 429(1), and the company receives the person's request more than 14 days before the date of that meeting, any time falling at least 7 days before the date of that meeting; or
  (b) in any other case, any time within 14 days after the date on which the company receives the person's request.

(4) Subsection (1) or (2) does not require a company to send a copy of the summary financial report or reporting documents for a financial year to a person if
  (a) where a copy of the reporting documents for the financial year is laid before the company in general meeting under section 429(1), the person's request is made after the expiry of a period of 6 months after the date of that meeting; or
  (b) where a copy of the reporting documents for the financial year is sent to every member under section 430(3), the person's request is made after the expiry of a period of 6 months after the date on which the copy is sent.

(5) Subsection (2) does not require a company to send a copy of the summary financial report for a financial year to a person unless
  (a) the company has prepared the summary financial report for the financial year; and
  (b) when the company sent a copy of the reporting documents for the financial year to the person, the company gave the person a right to request a copy of the summary financial report for the financial year.

(6) If a company contravenes subsection (1) or (2), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5 and, in the case of a continuing offence, to a further fine of $1000 for each day during which the offence continues.

(7) If a company is charged with an offence under subsection (6), it is a defence to establish that it took all reasonable steps to secure compliance with subsection (1) or (2) (as the case may be).

Section:

446

Company must not send summary financial report under some circumstances

(1) A company must not send a copy of the summary financial report for the purposes of section 441(1) for a financial year to a member if
  (a) the company's articles require that a copy of the reporting documents for the financial year must be sent to each member; or
  (b) the company's articles prohibit the company from sending a copy of the summary financial report for the purposes of section 441(1) for the financial year to a member.

(2) A company must not send a copy of the summary financial report for a financial year to a member if
  (a) an auditor's report has not been prepared on the financial statements for the financial year;
  (b) the summary financial report has not been approved by the directors;
  (c) the summary financial report has not been signed on the directors' behalf; or
  (d) the summary financial report does not comply with section 439(2).

(3) If a company contravenes subsection (1) or (2), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5.

Division:8

Miscellaneous

Section:

447

Exemption applicable to dormant company

(1) The following provisions do not apply to a company that is a dormant company under section 5(1)
  (a) section 367(4);
  (b) Subdivisions 3 and 4 of Division 4;
  (c) Subdivisions 2 and 3 of Division 5;
  (d) sections 411 and 412;
  (e) Subdivisions 6, 7 and 8 of Division 5; (f) Divisions 6 and 7.

(2) If such a company enters into an accounting transaction
  (a) subsection (1) ceases to have effect on and after the date of the accounting transaction; and
  (b) a member of the company who knew or ought to have known about the accounting transaction, and every director of the company, are personally liable for any debt or liability of the company arising out of the accounting transaction.

(3) In this section
director(董事) includes a shadow director.

Section:

448

Liability for untrue or misleading statement in reports

(1) This section applies to
  (a) a directors' report; and
  (b) a summary financial report so far as it is derived from a directors' report.

(2) A director of a company is liable to compensate the company for any loss suffered by the company as a result of —
  (a) any untrue or misleading statement in the report; or
  (b) the omission from the report of anything required to be included in it.

(3) A director is not liable unless
  (a) in the case of subsection (2)(a), the director knew the statement to be untrue or misleading or was reckless as to whether it was untrue or misleading; or
  (b) in the case of subsection (2)(b), the director knew the omission to be a dishonest concealment of a material fact.

(4) A person is not subject to any liability to another person other than the company resulting from reliance, by that other person or any other person, on information contained in the report.

(5) For the purposes of subsection (4), a person is also subject to a liability to another person if that other person is entitled against the person
  (a) to be granted any civil remedy; or
  (b) to rescind or repudiate an agreement.

(6) This section does not affect liability for criminal offence.

Section:

449

Voluntary revision of financial statements etc.

(1) If
  (a) a copy of any financial statements prepared by the directors of a company has been sent under section 430 to a member; and
  (b) it subsequently appears to the directors of the company that the financial statements did not comply with this Ordinance,
the directors may cause the financial statements to be revised and make necessary consequential revisions to the summary financial report or directors' report concerned.

(2) Such revision of the financial statements is to be confined to
  (a) those aspects of the financial statements that did not comply with this Ordinance; and
  (b) other necessary consequential revisions.

(3) If
  (a) the directors of a company decide to cause any financial statements to be revised under subsection (1); and
  (b) a copy of the financial statements has been delivered to the Registrar in compliance with section 664(3)(b),
the company must, within 7 days after the decision, deliver to the Registrar for registration a warning statement, in the specified form, that the financial statements will be so revised.

(4) If a company contravenes subsection (3), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5 and, in the case of a continuing offence, to a further fine of $1000 for each day during which the offence continues.

Section:

450

Financial Secretary may make regulation regarding revision of financial statements etc.

(1) The Financial Secretary may make regulations
  (a) providing for the application of this Ordinance in relation to the financial statements, summary financial report or directors' report that has been revised under section 449; and
  (b) providing for requirements in relation to revised financial statements, summary financial report or directors' report.

(2) The regulations may
  (a) make different provisions according to whether the financial statements, summary financial report or directors' report has been revised by
    (i) supplementing the financial statements or report with another document that shows the revisions; or
    (ii) replacing the financial statements or report;
  (b) provide for the functions of the persons who prepare the auditor's report in relation to the financial statements, summary financial report or directors' report that has been revised;
  (c) where
    (i) the financial statements or directors' report, or a copy of the statements or report, has, before the revision, been laid before the company in general meeting under section 429, been sent to members under section 430, or been delivered to the Registrar in compliance with section 664(3)(b); or
    (ii) a copy of a summary financial report has, before the revision, been sent to a member under section 441, or in compliance with a request under section 444 or 445(2), require the company or the directors of the company to take the steps specified in the regulations in relation to the financial statements or report that has been revised; and
  (d) provide for the application of this Ordinance to the financial statements, summary financial report or directors' report that has been revised, subject to such additions, exceptions and modifications as may be specified in the regulations.

(3) The regulations may provide that any of the following is an offence
  (a) a failure to take all reasonable steps to secure compliance with, as respects the financial statements, summary financial report or directors' report that has been revised
    (i) a specified provision of the regulations; or
    (ii) a specified provision of this Ordinance as having effect under the regulations;
  (b) a contravention of
    (i) a specified provision of the regulations; or
    (ii) a specified provision of this Ordinance as having effect under the regulations.

(4) The maximum fine that may be prescribed for an offence committed wilfully is $300000 and the maximum imprisonment is 12 months. The maximum fine that may be prescribed for an offence not committed wilfully is $300000. In addition, in the case of a continuing offence, a further fine not exceeding $2000 for each day during which the offence continues may be prescribed.

(5) The regulations may provide for defences to any such offence.

Section:

451

Financial Secretary may make regulation regarding disclosures of certain information

The Financial Secretary may make regulations prescribing, for the purposes of section 383(3), a requirement that the financial statements for the financial year are to contain a statement showing the information about the matter mentioned in section 383(1)(d).

Section:

452

Financial Secretary may make other regulations

(1) The Financial Secretary may make regulations prescribing a body for the purposes of section 380(8)(a).

(2) The Financial Secretary may make regulations
  (a) prescribing information that is required to be contained in the notes to any financial statements under section 383(1); and
  (b) prescribing other requirements for notes to any financial statements.

(3) The Financial Secretary may make regulations
  (a) prescribing information that is required to be contained in a directors' report under section 388(1) and (2); and
  (b) prescribing other requirements for a directors' report.

(4) The Financial Secretary may make regulations
  (a) prescribing information that is required to be contained in a summary financial report under section 439(2); and
  (b) prescribing other requirements for a summary financial report.

(5) The Financial Secretary may make regulations
  (a) providing for the form and contents of
    (i) a notification under section 442(2);
    (ii) a notice of intent under section 442(3); or
    (iii) any document attached to such a notification or notice; and
  (b) providing that any such document is to be postage prepaid.

Part:10

Directors and Company Secretaries

Division:1

Appointment, Removal and Resignation of Directors

Subdivision:1

Requirement to have Directors

Section:

453

Public company and company limited by guarantee required to have at least 2 directors

(1) This section applies to
  (a) a public company; and
  (b) a company limited by guarantee.

(2) The company must have at least 2 directors.

(3) With effect from the date of incorporation of the company, the first directors of the company are the persons named as the directors in the incorporation form delivered to the Registrar under section 67(1).

(4) A person who is deemed to be a director of the company under section 153(2) of the pre-amended predecessor Ordinance immediately before the commencement date* of this section continues to be deemed to be a director of the company as if section 19(1) of Schedule 2 to the Companies (Amendment) Ordinance 2004 (30 of 2004) had not been enacted, until a notice of appointment of a director is delivered to the Registrar in accordance with section 645(1).

(5) If a power specified in subsection (6) is exercisable by a director under the company's articles where the
number of directors is reduced below the number fixed as the necessary quorum of directors, the power is exercisable also where the number of directors is reduced below the number required by subsection (2).

(6) The power specified for the purposes of subsection (5) is a power to act for the purpose of
  (a) increasing the number of directors; or
  (b) calling a general meeting of the company, but not for any other purpose.

(7) In subsection (4)
pre-amended predecessor Ordinance(修訂前的《前身條例》) means the predecessor Ordinance that was in force immediately before it was amended by section 19(1) of Schedule 2 to the Companies (Amendment) Ordinance 2004 (30 of 2004).

Section:

454

Private company required to have at least one director

(1) A private company must have at least one director.

(2) With effect from the date of incorporation of a private company, the first directors of the company are the persons named as the directors in the incorporation form delivered to the Registrar under section 67(1).

(3) A person who is deemed to be a director of a private company under section 153A(2) of the pre-amended predecessor Ordinance immediately before the commencement date* of this section continues to be deemed to be a director of the company as if section 20(1) of Schedule 2 to the Companies (Amendment) Ordinance 2004 (30 of 2004) had not been enacted, until a notice of appointment of a director is delivered to the Registrar in accordance with section 645(1).

(4) In subsection (3)
pre-amended predecessor Ordinance(修訂前的《前身條例》) means the predecessor Ordinance that was in force immediately before it was amended by section 20(1) of Schedule 2 to the Companies (Amendment) Ordinance 2004 (30 of 2004).

Section:

455

Nomination of reserve director of private company

(1) If a private company has only one member and that member is the sole director of the company, the company may by a resolution passed at a general meeting, despite anything in its articles, nominate a person (other than a body corporate) who has attained the age of 18 years as a reserve director of the company to act in the place of the sole director in the event of the sole director's death.

(2) The nomination of a person as a reserve director of a private company ceases to have effect if
  (a) before the death of the director in respect of whom the person was nominated
    (i) the person resigns as reserve director in accordance with section 464; or
    (ii) the company at a general meeting revokes the nomination; or
  (b) the director in respect of whom the person was nominated ceases to be the sole member and sole director of the company for any reason other than the death of that director.

(3) If the nomination of a person as a reserve director of a private company ceases to have effect under subsection (2), the company must deliver a notice to the Registrar in accordance with section 645(4).

(4) Subject to compliance with the conditions specified in subsection (5), in the event of the death of the director in respect of whom the reserve director is nominated, the reserve director is to be regarded as a director of the company for all purposes until
  (a) a person is appointed as a director of the company in accordance with its articles; or
  (b) the reserve director resigns from the office of director in accordance with section 464, whichever is the earlier.

(5) The conditions specified for the purposes of subsection (4) are
  (a) that the nomination of the reserve director has not ceased to have effect under subsection (2); and
  (b) that the reserve director is not prohibited by law nor disqualified from acting as a director of the company.

Section:

456

Restriction on body corporate being director

(1) This section applies to
  (a) a public company;
  (b) a private company that is a member of a group of companies of which a listed company is a member; and
  (c) a company limited by guarantee.

(2) A body corporate must not be appointed a director of the company.

(3) An appointment made in contravention of subsection (2) is void.

(4) Nothing in this section affects any liability of a body corporate under any provision of this Ordinance or the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32) if it
  (a) purports to act as a director; or
  (b) acts as a shadow director,
although it could not, by virtue of this section, be appointed as a director.

Section:

457

Requirement to have at least one director who is natural person

(1) This section applies to a private company other than a private company that is a member of a group of companies of which a listed company is a member.

(2) The company must have at least one director who is a natural person.

Section:

458

Direction requiring company to appoint director

(1) If it appears to the Registrar that a company is in contravention of section 453(2), 454(1) or 457(2), the Registrar may direct the company to appoint a director or directors in compliance with that section.

(2) The direction must specify
  (a) the statutory requirement of which the company appears to be in contravention;
  (b) subject to subsection (3), the period within which the company must comply with the direction; and
  (c) that a failure to comply with the direction is an offence under subsection (6).

(3) The period must not be less than one month or more than 3 months after the date on which the direction is given.

(4) The Registrar may, before the end of the period specified in the direction, by notice in writing extend the period.
(5) The company must comply with the direction by making the necessary appointment or appointments before the end of the period specified in the direction, or, if the period is extended by the Registrar under subsection (4), the extended period.

(6) If a company fails to comply with a direction under this section, 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.

Subdivision:2

Appointment of Directors

Section:

459

Minimum age for appointment as director

(1) A person must not be appointed a director of a company unless at the time of appointment the person has attained the age of 18 years.

(2) An appointment made in contravention of subsection (1) is void.

(3) Nothing in this section affects any liability of a person under any provision of this Ordinance or the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32) if the person
  (a) purports to act as a director; or
  (b) acts as a shadow director,
although the person could not, by virtue of this section, be appointed as a director.

Section:

460

Appointment of directors to be voted on individually

(1) This section applies to
  (a) a public company; and
  (b) a company limited by guarantee.

(2) At a general meeting of the company, a motion for the appointment of 2 or more persons as directors of the company by a single resolution must not be made, unless a resolution that it may be so made has first been passed at the meeting without any vote against it.

(3) A resolution moved in contravention of subsection (2) is void, whether or not its being so moved was objected to at the time.

(4) Despite the fact that the resolution is void, no provision (whether contained in a company's articles or in any contract with the company or otherwise) for the automatic reappointment of retiring directors in default of another appointment applies.

(5) For the purposes of this section, a motion for approving a person's appointment, or for nominating a person for appointment, is to be regarded as a motion for the appointment of the person.

Section:

461

Validity of acts of director

(1) The acts of a person acting as a director are valid despite the fact that it is afterwards discovered
  (a) that there was a defect in the appointment of the person as a director;
  (b) that the person was not qualified to hold office as a director or was disqualified from holding office as a director;
  (c) that the person had ceased to hold office as a director; or
  (d) that the person was not entitled to vote on the matter in question.

(2) Subsection (1) applies even if
  (a) the appointment of the person as a director is void under section 456(3) or 459(2); or
  (b) the resolution for the appointment of the person as a director is void under section 460(3).

Subdivision:3

Removal and Resignation of Directors

Section:

462

Resolution to remove director

(1) A company may by an ordinary resolution passed at a general meeting remove a director before the end of the director's term of office, despite anything in its articles or in any agreement between it and the director.

(2) Subsection (1) does not, if the company is a private company, authorize the removal of a director who has held office for life since 31 August 1984.

(3) Subsections (4), (5), (6), (7) and (8) apply in relation to a removal of a director by resolution, irrespective of whether the removal by resolution is under subsection (1) or otherwise.

(4) Special notice is required of a resolution
  (a) to remove a director; or
  (b) to appoint somebody in place of a director so removed at the meeting at which the director is removed.

Note

See also section 578 which sets out the requirements regarding special notice.

(5) A vacancy created by the removal of a director, if not filled at the meeting at which the director is removed, may be filled as a casual vacancy.

(6) A person appointed director in place of a removed director is to be regarded, for the purpose of determining the time at which that person or any other director is to retire, as if that person had become director on the day on which the person removed was last appointed a director.

(7) In relation to a resolution to remove a director before the end of the director's term of office, no share may, on a poll, carry a greater number of votes than it would carry in relation to the generality of matters to be voted on at a general meeting of the company.

(8) If a share carries special voting rights (that is to say, rights different from those carried by other shares) in relation to some matters but not others, the reference in subsection (7) to the generality of matters to be voted on at a general meeting of the company is to be construed as a reference to the matters in relation to which the share carries no special voting rights.

(9) This section is not to be regarded as depriving a person of compensation or damages payable to the person in respect of the termination of
  (a) the person's appointment as director; or
  (b) any appointment terminating with that as director.

Section:

463

Director’s right to protest against removal

(1) On receipt of notice of a resolution under section 462(4) to remove a director, the company must forthwith send a copy of the notice to the director concerned.

(2) The director (whether or not a member of the company) is entitled to be heard on the resolution at the meeting at which the resolution is voted on.

(3) If notice is given of a resolution under section 462(4) to remove a director, the director
  (a) may make with respect to the resolution representations in writing to the company (not exceeding a reasonable length); and
  (b) may request the company to comply with the requirement specified in subsection (4) in relation to the representations.

(4) The requirement specified for the purposes of subsection (3)(b) is
  (a) if the company receives the representations on a date that is more than 2 days before the last day on which notice may be given under section 571(1) to call the meeting, the requirement
    (i) to state, in every notice of the meeting given to the members, that the representations have been made; and
    (ii) to send a copy of the representations to every member to whom a notice of the meeting is or has been given; or
  (b) if the company has not sent a copy of the representations to every member to whom a notice of the meeting is or has been given, the requirement to ensure that the representations are read out at the meeting.

(5) Unless exempted by an order under subsection (6), the company must comply with a request made under subsection (3)(b).

(6) On application by the company or by anyone who claims to be aggrieved, the Court may order that the company is exempted from complying with the request, if it is satisfied that the person who has made representations and made a requirement under subsection (3)
  (a) has abused the right to do so; or
  (b) has used such a right to secure needless publicity for defamatory matter.

(7) If the company contravenes subsection (5), the resolution passed under section 462(1) is void even though section 562(1) is complied with.

Section:

464

Resignation of director

(1) A director of a company may, unless it is otherwise provided in the articles of the company or by any agreement with the company, resign as director at any time.

(2) If a director of a company resigns, the company must deliver a notice of the resignation to the Registrar in the manner required by section 645(4).

(3) Despite subsection (2), if the director resigning has reasonable grounds for believing that the company will not deliver the notice, the director resigning must deliver to the Registrar for registration a notice of the resignation in the specified form.

(4) The notice required to be delivered under subsection (3) must state
  (a) whether the director resigning is required by the articles of the company or by any agreement with the company to give notice of resignation to the company; and
  (b) if notice is so required, whether the notice has been given in accordance with the requirement.

(5) If notice of the resignation of a director of a company is required to be given by the articles of the company or by any agreement with the company, the resignation does not have effect unless the director gives notice in writing of the resignation
  (a) in accordance with the requirement;
  (b) by leaving it at the registered office of the company; or
  (c) by sending it to the company in hard copy form or in electronic form. (6) In this section
director(董事) includes a reserve director and a person regarded as a director under section 455(4).

Division:2

Directors’ Duty of Care, Skill and Diligence

Section:

465

Duty to exercise reasonable care, skill and diligence

(1) A director of a company must exercise reasonable care, skill and diligence.

(2) Reasonable care, skill and diligence mean the care, skill and diligence that would be exercised by a reasonably diligent person with
  (a) the general knowledge, skill and experience that may reasonably be expected of a person carrying out the functions carried out by the director in relation to the company; and
  (b) the general knowledge, skill and experience that the director has.

(3) The duty specified in subsection (1) is owed by a director of a company to the company.

(4) The duty specified in subsection (1) has effect in place of the common law rules and equitable principles as regards the duty to exercise reasonable care, skill and diligence, owed by a director of a company to the company.

(5) This section applies to a shadow director as it applies to a director.

(6) For the purposes of subsection (5), a body corporate is not to be regarded as a shadow director of any of its subsidiaries by reason only that the directors, or a majority of the directors, of the subsidiary are accustomed to act in accordance with its direction or instructions.

Section:

466

Civil consequences of breach of duty to exercise reasonable care, skill and diligence

Without affecting other provisions of this Ordinance or the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32), the consequences of breach (or threatened breach) of the duty specified in section 465(1) are the same as would apply if the common law rules or equitable principles that section 465(1) replaces applied.

Division:3

Directors’ Liabilities

Section:

467

Interpretation and application

(1) In this Division
permitted indemnity provision (獲准許的彌償條文) , in relation to a company, means a provision that
  (a) provides for indemnity against liability incurred by a director of the company to a third party; and
  (b) meets the requirements specified in section 469(2);
third party (第三者) , in relation to a company, means a person other than the company or an associated company.

(2) Sections 468, 469 and 470 apply to any provision made on or after the commencement date* of those sections.

(3) Sections 471 and 472 apply to a permitted indemnity provision made on or after the commencement date* of those sections.

(4) Section 473 applies to conduct by a director on or after the commencement date* of that section.

Section:

468

Avoidance of provisions protecting director from liability

(1) This section applies to a provision contained in a company's articles, or in a contract entered into by a company, or otherwise.

(2) If a provision purports to exempt a director of the company from any liability that would otherwise attach to the director in connection with any negligence, default, breach of duty or breach of trust in relation to the company, the provision is void.

(3) If, by a provision, the company directly or indirectly provides an indemnity for a director of the company, or a director of an associated company of the company, against any liability attaching to the director in connection with any negligence, default, breach of duty or breach of trust in relation to the company or associated company (as the case may be), the provision is void.

(4) Subsection (3) does not prevent a company from taking out and keeping in force insurance for a director of the company, or a director of an associated company of the company, against
  (a) any liability to any person attaching to the director in connection with any negligence, default, breach of duty or breach of trust (except for fraud) in relation to the company or associated company (as the case may be); or
  (b) any liability incurred by the director in defending any proceedings (whether civil or criminal) taken against the director for any negligence, default, breach of duty or breach of trust (including fraud) in relation to the company or associated company (as the case may be).

Section:

469

Permitted indemnity provision

(1) Section 468(3) does not apply to a provision for indemnity against liability incurred by the director to a third party if the requirements specified in subsection (2) are met in relation to the provision.

(2) The provision must not provide any indemnity against
  (a) any liability of the director to pay
    (i) a fine imposed in criminal proceedings; or
    (ii) a sum payable by way of a penalty in respect of non-compliance with any requirement of a regulatory nature; or
  (b) any liability incurred by the director
    (i) in defending criminal proceedings in which the director is convicted;
    (ii) in defending civil proceedings brought by the company, or an associated company of the company, in which judgment is given against the director;
    (iii) in defending civil proceedings brought on behalf of the company by a member of the company or of an associated company of the company, in which judgment is given against the director;
    (iv) in defending civil proceedings brought on behalf of an associated company of the company by a member of the associated company or by a member of an associated company of the associated company, in which judgment is given against the director; or
    (v) in connection with an application for relief under section 358 of the predecessor Ordinance or section 903 or 904 in which the Court refuses to grant the director relief.

(3) A reference in subsection (2)(b) to a conviction, judgment or refusal of relief is to the final decision in the proceedings.

(4) For the purposes of subsection (3), a conviction, judgment or refusal of relief
  (a) if not appealed against, becomes final at the end of the period for bringing an appeal; or
  (b) if appealed against, becomes final when the appeal, or any further appeal, is disposed of.

(5) For the purposes of subsection (4)(b), an appeal is disposed of if
  (a) it is determined, and the period for bringing any further appeal has ended; or
  (b) it is abandoned or otherwise ceases to have effect.

Section:

470

Permitted indemnity provision to be disclosed in directors’ report

(1) If, when a directors' report prepared by the directors of a company is approved in accordance with section 391, a permitted indemnity provision (whether made by the company or otherwise) is in force for the benefit of one or more directors of the company, the report must state that the provision is in force.

(2) If, at any time during the financial year to which a directors' report prepared by the directors of a company relates, a permitted indemnity provision (whether made by the company or otherwise) was in force for the benefit of one or more persons who were then directors of the company, the report must state that the provision was in force.

(3) If, when a directors' report prepared by the directors of a company is approved in accordance with section 391, a permitted indemnity provision made by the company is in force for the benefit of one or more directors of an associated company of the company, the report must state that the provision is in force.

(4) If, at any time during the financial year to which a directors' report prepared by the directors of a company relates, a permitted indemnity provision made by the company was in force for the benefit of one or more persons who were then directors of an associated company of the company, the report must state that the provision was in force.

(5) In this section
directors' report(董事報告) means
  (a) the report required to be prepared under section 388(1); or
  (b) the consolidated report required to be prepared under section 388(2).

Section:

471

Place where copy of permitted indemnity provision must be kept

(1) This section has effect if a permitted indemnity provision is made for a director of a company, and applies
  (a) to that company (whether the provision is made by that company or an associated company of that company); and
  (b) if the provision is made by an associated company, to that associated company.

(2) A company to which this section applies must keep the following at its registered office or at a place prescribed by regulations made under section 657
  (a) a copy of the permitted indemnity provision;
  (b) if the provision is not in writing, a written memorandum setting out the terms of the provision.

(3) The company
  (a) must retain the copy or memorandum for at least one year after the date of termination or expiry of the provision; and
  (b) must keep the copy or memorandum available for inspection during that time.

(4) If the copy or memorandum is kept at a place other than the company's registered office, the company must notify the Registrar of the place, or any change in the place, at which the copy or memorandum is kept. The notice must be in the specified form and delivered to the Registrar for registration within 15 days after the copy or memorandum is first kept at that place or within 15 days after the change (as the case may be).

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

(6) If a company contravenes subsection (4), 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.

(7) In this section, a reference to a permitted indemnity provision includes a variation of the provision.

Section:

472

Right of member to inspect and request copy

(1) A member of a company is entitled, on request made in the prescribed manner and without charge, to inspect, in accordance with regulations made under section 657, a copy of a permitted indemnity provision or a written memorandum kept by the company under section 471.

(2) A member of the company is entitled, on request and on payment of a prescribed fee, to be provided with a copy of the provision or memorandum in accordance with regulations made under section 657.

(3) In this section
prescribed(訂明) means prescribed by regulations made under section 657.

(4) In this section, a reference to a permitted indemnity provision includes a variation of the provision.

Section:

473

Ratification of conduct by director involving negligence, etc.

(1) This section applies to the ratification by a company of conduct by a director involving negligence, default, breach of duty or breach of trust in relation to the company.

(2) A decision of the company to ratify the conduct may only be made by resolution of the members of the company.

(3) If such a resolution is proposed at a meeting, every vote in favour of the resolution by a member who
  (a) is a director in respect of whose conduct the ratification is sought;
  (b) is an entity connected with that director; or
  (c) holds any shares in the company in trust for that director or entity, is to be disregarded.

(4) Subsection (3) does not prevent a member specified in that subsection from attending, being counted towards the quorum for, or taking part in the proceedings at, any meeting at which the decision is considered.

(5) For the purposes of this section
  (a) conduct(行為) includes acts and omissions;
  (b) director(董事) includes a former director;
  (c) a shadow director is to be regarded as a director; and
  (d) a reference to an entity connected with a director has the meaning given by section 486.

(6) Nothing in this section affects
  (a) the validity of a decision taken by unanimous consent of the members of the company; or
  (b) any power of the directors to agree not to sue, or to settle or release a claim made by them on behalf of the company.

(7) This section does not affect
  (a) any other Ordinance or rule of law imposing additional requirements for valid ratification; or
  (b) any rule of law as to acts that are incapable of being ratified by the company.

Division:4

Appointment and Resignation of Company Secretarie

Section:

474

Company required to have company secretary

(1) A company must have a company secretary.

(2) With effect from the date of incorporation of a company, the first company secretary of the company is the person named as the company secretary in the incorporation form delivered to the Registrar under section 67(1).

(3) If the name of a firm is specified in the incorporation form under section 5(1)(c) of Schedule 2, all partners of the firm as at the date of the incorporation form are the first joint company secretaries of the company.

(4) A company secretary of a company must
  (a) if a natural person, ordinarily reside in Hong Kong; and
  (b) if a body corporate, have its registered office or a place of business in Hong Kong.

(5) Anything required or authorized to be done by or to the company secretary may be done
  (a) if the office is vacant or there is for any other reason no company secretary capable of acting, by or to any assistant or deputy company secretary; or
  (b) if there is no assistant or deputy company secretary capable of acting, by or to any officer of the company authorized generally or specially in that behalf by the directors.

Section:

475

Circumstances under which director may not be company secretary

(1) Subject to subsections (2) and (3), a director of a company may be a company secretary of the company.

(2) The director of a private company having only one director must not also be a company secretary of the company.

(3) No private company having only one director may have as company secretary of the company a body corporate the sole director of which is the sole director of the private company.

Section:

476

Direction requiring company to appoint company secretary

(1) If it appears to the Registrar that a company is in contravention of section 474(1) or (4) or 475(2) or (3), the Registrar may direct the company to appoint a company secretary in compliance with that section.

(2) The direction must specify
  (a) the statutory requirement of which the company appears to be in contravention;
  (b) subject to subsection (3), the period within which the company must comply with the direction; and
  (c) that a failure to comply with the direction is an offence under subsection (6).

(3) The period must not be less than one month or more than 3 months after the date on which the direction is given.

(4) The Registrar may, before the end of the period specified in the direction, by notice in writing extend the period.

(5) The company must comply with the direction by making the necessary appointment before the end of the period specified in the direction, or, if the period is extended by the Registrar under subsection (4), the extended period.

(6) If a company fails to comply with a direction under this section, 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:

477

Resignation of company secretary

(1) A company secretary of a company may, unless it is otherwise provided in the articles of the company or by any agreement with the company, resign as company secretary at any time.

(2) If a company secretary of a company resigns, the company must deliver a notice of the resignation to the Registrar in the manner required by section 652(2).

(3) Despite subsection (2), if the company secretary resigning has reasonable grounds for believing that the company will not deliver the notice, the company secretary resigning must deliver to the Registrar for registration a notice of the resignation in the specified form.

(4) The notice required to be delivered under subsection (3) must state
  (a) whether the company secretary resigning is required by the articles of the company or by any agreement with the company to give notice of resignation to the company; and
  (b) if notice is so required, whether the notice has been given in accordance with the requirement.

(5) If notice of the resignation of a company secretary of a company is required to be given by the articles of the company or by any agreement with the company, the resignation does not have effect unless the company secretary gives notice in writing of the resignation
  (a) in accordance with the requirement;
  (b) by leaving it at the registered office of the company; or
  (c) by sending it to the company in hard copy form or in electronic form.

Division:5

Miscellaneous Provisions Relating to Directors and Company Secretaries

Section:

478

Director vicariously liable for acts of alternate etc.

(1) If the articles of a company authorize a director to appoint an alternate director to act in place of the director, then, unless the articles contain any provision to the contrary, whether express or implied
  (a) an alternate director so appointed is deemed to be the agent of the director who appoints the alternate director; and
  (b) a director who appoints an alternate director is vicariously liable for any tort committed by the alternate director while acting in the capacity of alternate director.

(2) Nothing in subsection (1)(b) affects the personal liability of an alternate director for any act or omission.

Section:

479

Avoidance of acts done by person in dual capacity as director and company secretary

(1) A provision requiring or authorizing a thing to be done by or to a director and a company secretary of a company is not satisfied by its being done by or to the same person acting
  (a) both as director and company secretary; or
  (b) both as director and in place of the company secretary.

(2) This section applies to
  (a) any provision of this Ordinance or the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32); and
  (b) any provision in a company's articles.

Section:

480

Provisions as to undischarged bankrupt acting as director

(1) A person who is an undischarged bankrupt must not act as director of, or directly or indirectly take part or be concerned in the management of, a company, except with the leave of the Court by which the person was adjudged bankrupt.

(2) A person who contravenes subsection (1) commits an offence and is liable
  (a) on conviction on indictment to a fine of $700000 and to imprisonment for 2 years; or
  (b) on summary conviction to a fine of $150000 and to imprisonment for 12 months.

(3) The Court must not give leave for the purposes of this section unless notice of intention to apply for it has been served on the Official Receiver.

(4) If the Official Receiver is of opinion that it is contrary to the public interest that an application under subsection (3) should be granted, the Official Receiver must attend the hearing of, and oppose the granting of, the application.

(5) In subsection (1)
company( 公司 ) has the meaning given by section 168C(1) of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32).

Section:

481

Minutes of directors’ meetings

(1) A company must cause minutes of all proceedings at meetings of its directors to be recorded.

(2) A company must keep the records under subsection (1) for at least 10 years from the date of the meeting.

(3) If a company contravenes subsection (1) or (2), the company, and every responsible person of the company, commit an offence, and each is liable to a fine at level 5 and, in the case of a continuing offence, to a further fine of $1000 for each day during which the offence continues.

Section:

482

Minutes as evidence

(1) Minutes recorded in accordance with section 481, if purporting to be signed by the chairperson of the meeting or by the chairperson of the next directors' meeting, are evidence of the proceedings at the meeting.

(2) If minutes have been recorded in accordance with section 481 of the proceedings at a meeting of directors, then, until the contrary is proved
  (a) the meeting is to be regarded as having been duly held and convened;
  (b) all proceedings at the meeting are to be regarded as having duly taken place; and
  (c) all appointments at the meeting are to be regarded as valid. (3) Subsection (2)(c) is subject to sections 456(3) and 459(2).

Section:

483

Written record of decision of sole director of private company

(1) If a private company has only one director and the director takes any decision that
  (a) may be taken in a meeting of directors; and
  (b) has effect as if agreed in a meeting of directors, the director must (unless that decision is taken by way of a resolution in writing) provide the company with a written record of that decision within 7 days after the decision is made.

(2) If the director provides the company with a written record of a decision in accordance with subsection (1), that record is sufficient evidence of the decision having been taken by the director.

(3) A company must keep a written record provided to the company in accordance with subsection (1) for at least 10 years from the date of the decision.

(4) A director who contravenes subsection (1) commits an offence.

(5) If a company contravenes subsection (3), the company, and every responsible person of the company, commit an offence.

(6) A person who commits an offence under subsection (4) is liable to a fine at level 3.

(7) A person who commits an offence under subsection (5) is liable to a fine at level 5 and, in the case of a continuing offence, to a further fine of $1,000 for each day during which the offence continues.

(8) A contravention of subsection (1) by a director does not affect the validity of any decision mentioned in that subsection.

Part:11

Fair Dealing by Directors

Division:1

Preliminary

Section:

484

Interpretation

(1) In this Division
child (子女) includes a step-child, an illegitimate child and achild adopted in any manner recognized by the law of Hong Kong;
cohabitation relationship ( 同居關係 ) means a relationshipbetween 2 persons (whether of the same sex or of the opposite sex) who live together as a couple in an intimaterelationship;
director (董事) includes a shadow director.

(2) In this Division, a reference to a minor child is a reference to a child who is under 18 years of age.

Section:

485

Circumstances constituting contravention

In this Part, a reference to circumstances constituting a contravention includes, in the case of a transaction or arrangement that, but for any fact or circumstances, would not be prohibited because of Subdivision 3 of Division 2, the fact or circumstances.

Section:

486

Connected entity

(1) In this Part, a reference to an entity connected with a director or former director of a company is a reference to
  (a) a member of the director's or former director's family;
  (b) a person who is in a cohabitation relationship with the director or former director;
  (c) a minor child of a person falling within paragraph (b) who
    (i) is not a child of the director or former director; and
    (ii) lives with the director or former director;
  (d) a body corporate with which the director or former director is associated;
  (e) a person acting in the capacity as trustee of a specified trust, other than a trust for the purpose of an employee share scheme or a pension scheme; or
  (f) a person acting in the capacity as partner of
    (i) the director or former director;
    (ii) the spouse of the director or former director;
    (iii) a minor child of the director or former director; or
    (iv) another person who, by virtue of paragraph (e), is an entity connected with the director or former director.

(2) For the purposes of subsection (1)(e), a trust is a specified trust
  (a) if the beneficiaries of the trust include
    (i) the director or former director;
    (ii) the spouse of the director or former director; or
    (iii) a minor child of the director or former director; or
  (b) if
    (i) the terms of the trust give a power to the trustees that may be exercised for the benefit of
      (A) the director or former director;
      (B) the spouse of the director or former director; or
      (C) a minor child of the director or former director; and
    (ii) the director or former director knows that the director or former director, or the spouse or child, is an object of the power.

(3) In this section
employee share scheme(僱員參股計劃) means a scheme for encouraging or facilitating the holding of shares in a company by or for the benefit of
  (a) persons employed or formerly employed in good faith by that company or another company in the same group of companies; or
  (b) the spouses, widows, widowers or minor children of persons referred to in paragraph (a);
partner(合夥人), in relation to another person, means a person who is a partner of that other person in a partnership within the meaning of the Partnership Ordinance (Cap 38).

Section:

487

Family member of director or former director

In this Part, a reference to a member of a director's or former director's family is a reference to
  (a) the spouse of the director or former director;
  (b) a child of the director or former director; or
  (c) a parent of the director or former director.

Section:

488

Director or former director associated with body corporate

(1) For the purposes of this Part, a director or former director is associated with a body corporate if
  (a) the director or former director, or any one or more of the entities specified in subsection (3), or the director or former director together with any one or more of those specified entities, are entitled to exercise, or control the exercise of, more than 30% of the voting power at any general meeting of that body corporate; or
  (b) the directors, or a majority of the directors, of that body corporate are accustomed to act in accordance with the directions or instructions of
    (i) the director or former director; or
    (ii) an entity connected with the director or former director.

(2) In this section, a reference to voting power the exercise of which is controlled by a director or former director, or by an entity specified in subsection (3), includes voting power the exercise of which is controlled by another body corporate if the director or former director, or any one or more of the specified entities, or the director or former director together with any one or more of the specified entities, are entitled to exercise, or control the exercise of, more than 50% of the voting power at any general meeting of that other body corporate.

(3) The entity specified for the purposes of subsections (1) and (2) is
  (a) the spouse of the director or former director;
  (b) a minor child of the director or former director; or
  (c) a person who, by virtue of section 486(1)(e), is an entity connected with the director or former director.

Section:

489

Company subject to more than one prohibition

(1) If a company is prohibited by more than one provision of this Part from doing something without the approval of the members of the company, or of the members of a holding company of the company, specified in each provision, the company is prohibited from doing the thing without all those approvals.

(2) Subsection (1) does not require a separate resolution for the purposes of each of the provisions.

Section:

490

Application to transaction or arrangement despite its governing law

For the purposes of this Part, it is immaterial whether or not the law (apart from this Ordinance) that governs a transaction or arrangement is the law of Hong Kong.

Division:2

Loan, Quasi-loan and Credit Transaction

Subdivision:

Preliminary

Section:

491

Interpretation

(1) In this Division
director (董事) includes a shadow director;
guarantee (擔保) includes indemnity;
land (土地) includes any estate or interest in land, buildings, messuages and tenements of any nature or kind;
services (服務) means anything other than goods or land;
specified company (指明公司) means
  (a) a public company; or
  (b) a private company or company limited by guarantee that is a subsidiary of a public company.

(2) For the purposes of this Division, a body corporate is not to be regarded as a shadow director of any of its subsidiaries by reason only that the directors, or a majority of the directors, of the subsidiary are accustomed to act in accordance with its directions or instructions.

Section:

492

Body corporate controlled by director

(1) For the purposes of this Division, a body corporate is controlled by a director if
  (a) the director is entitled to exercise, or control the exercise of, more than 50% of the voting power at any general meeting of that body corporate; or
  (b) the directors, or a majority of the directors, of that body corporate are accustomed to act in accordance with the directions or instructions of the director.

(2) In subsection (1), a reference to voting power the exercise of which is controlled by a director includes voting power the exercise of which is controlled by another body corporate if the director is entitled to exercise, or control the exercise of, more than 50% of the voting power at any general meeting of that other body corporate.

Section:

493

Quasi-loan

(1) For the purposes of this Division, a person makes a quasiloan to a director or an entity connected with a director if the person
  (a) agrees to pay, or pays otherwise than pursuant to an agreement, a sum for the director or connected entity
    (i) on terms that the director or connected entity (or another person on behalf of the director or connected entity) will reimburse the person; or
    (ii) in circumstances giving rise to a liability on the director or connected entity to reimburse the person; or
  (b) agrees to reimburse, or reimburses otherwise than pursuant to an agreement, expenditure incurred by another person for the director or connected entity
    (i) on terms that the director or connected entity (or another person on behalf of the director or connected entity) will reimburse the person; or
    (ii) in circumstances giving rise to a liability on the director or connected entity to reimburse the person.

(2) For the purposes of this Division, if a person makes a quasi-loan to a director or an entity connected with a director, the director's or connected entity's liabilities under the quasi-loan include the liabilities of any other person who has agreed to reimburse the person on the director's or connected entity's behalf.

Section:

494

Credit transaction

(1) For the purposes of this Division, a person enters into a credit transaction as creditor for a director or an entity connected with a director if the person
  (a) supplies goods to the director or connected entity under a hire-purchase agreement;
  (b) sells goods or land to the director or connected entity under a conditional sale agreement;
  (c) leases or hires goods or leases land to the director or connected entity in return for periodical payments; or
  (d) otherwise supplies goods or services or disposes of land to the director or connected entity on the understanding that payment (whether in a lump sum or instalments or by way of periodical payments or otherwise) is to be deferred.

(2) In this section
conditional sale agreement(有條件售賣協議) means an agreement for the sale of goods or land under which
  (a) the purchase price or part of it is payable by instalments;
  (b) the property in the goods or land is to remain in the seller until the conditions regarding the payment of instalments, or other conditions, specified in the agreement are fulfilled; and
  (c) despite such reservation of property, the buyer is to be in possession of the goods or land before the fulfilment of those conditions;
hire-purchase agreement(租購協議) means an agreement for the bailment of goods under which the bailee may buy the goods, or under which the property in the goods will or may pass to the bailee.

Section:

495

Person for whom transaction or arrangement entered into

(1) In this Division, a reference to a director, a body corporate controlled by a director, or an entity connected with a director, for whom a transaction is entered into is
  (a) in the case of a loan or quasi-loan, or a guarantee or security in connection with a loan or quasi-loan, a reference to the director, controlled body corporate or connected entity to whom the loan or quasi-loan is made; or
  (b) in the case of a credit transaction, or a guarantee or security in connection with a credit transaction, a reference to the director or connected entity to whom goods, land or services are supplied, sold, leased, hired or otherwise disposed of under the credit transaction.

(2) For the purposes of this Division, an arrangement is entered into for a director, a body corporate controlled by a director, or an entity connected with a director if
  (a) in the case of an arrangement mentioned in section 504(1)(a) or (2)(a), a company takes part in the arrangement under which another person enters into a transaction with the director, controlled body corporate or connected entity; or
  (b) in the case of an arrangement mentioned in section 504(1)(b) or (2)(b), a company enters into the arrangement in relation to any rights, obligations or liabilities under a transaction entered into by another person with the director, controlled body corporate or connected entity.

Section:

496

Prescribed approval of members

(1) In this Division, a reference to the prescribed approval of the members of a company that enters into a transaction or arrangement, or the members of a holding company of the company, is a reference to an approval obtained by a resolution of those members
  (a) that is passed before the transaction or arrangement is entered into; and
  (b) in respect of which the requirements specified in subsection (2) are met. (2) The requirements specified for the purposes of subsection (1)(b) are
  (a) that, in the case of a written resolution, a memorandum setting out the matters specified in subsection (4) is sent to every member at or before the time at which the proposed resolution is sent to the member; or
  (b) that, in the case of a resolution passed at a general meeting
    (i) a memorandum setting out the matters specified in subsection (4) is sent to every member together with the notice convening the meeting; and
    (ii) if the company is a specified company, the resolution is passed after disregarding every vote in favour of the resolution by a member specified in subsection (5).

(3) Subject to any provision of the company's articles, any accidental omission to send the memorandum to a member is to be disregarded for the purpose of determining whether the requirement specified in subsection (2)(a) or (b)(i) has been met.

(4) The matters specified for the purposes of subsection (2)(a) and (b)(i) are
  (a) in the case of a resolution for the purposes of section 500, 501 or 502
    (i) the nature of the transaction to be approved by the resolution;
    (ii) the amount of the loan or quasi-loan;
    (iii) the purpose for which the loan or quasi-loan is required; and
    (iv) the extent of the company's liability under any transaction connected with the loan or quasi-loan;
  (b) in the case of a resolution for the purposes of section 503
    (i) the nature of the transaction to be approved by the resolution;
    (ii) the amount and value of the credit transaction;
    (iii) the purpose for which the goods, land or services supplied, sold, leased, hired or otherwise disposed of under the credit transaction are required; and
    (iv) the extent of the company's liability under any transaction connected with the credit transaction; or
  (c) in the case of a resolution for the purposes of section 504
    (i) the matters that would have to be disclosed if the company were seeking approval of the transaction to which the arrangement relates;
    (ii) the nature of the arrangement to be approved by the resolution; and
    (iii) the extent of the company's liability under the arrangement.

(5) The member specified for the purposes of subsection (2)(b)(ii) is
  (a) in the case of a resolution for the purposes of section 500 or 501
    (i) one who is the controlled body corporate to whom the loan is proposed to be made or was made;
    (ii) one who is the director
      (A) who controls that body corporate; or
      (B) to whom the loan or quasi-loan is proposed to be made or was made; or
    (iii) one who holds any shares in the company in trust for that controlled body corporate or director; (b) in the case of a resolution for the purposes of section 502
    (i) one who is the connected entity to whom the loan or quasi-loan is proposed to be made or was made;
    (ii) one who is the director with whom that entity is connected; or
    (iii) one who holds any shares in the company in trust for that connected entity or director;
  (c) in the case of a resolution for the purposes of section 503
    (i) one who is the director or connected entity for whom the credit transaction is proposed to be entered into or was entered into;
    (ii) one who is the director with whom that entity is connected; or
    (iii) one who holds any shares in the company in trust for the director specified in subparagraph (i) or (ii) or that connected entity; or
  (d) in the case of a resolution for the purposes of section 504
    (i) one who is the controlled body corporate, or connected entity, for whom the arrangement is proposed to be entered into or was entered into;
    (ii) one who is the director
      (A) who controls that body corporate;
      (B) with whom that entity is connected; or
      (C) for whom the arrangement is proposed to be entered into or was entered into; or
    (iii) one who holds any shares in the company in trust for that controlled body corporate, connected entity or director.

(6) Subsection (2)(b)(ii) does not prevent a member specified in subsection (5) from attending, being counted towards the quorum for, or taking part in the proceedings at, any meeting at which the decision is considered.

(7) In this section, a reference to a transaction to which an arrangement relates is
  (a) in the case of an arrangement mentioned in section 504(1)(a) or (2)(a), a reference to the transaction entered into with a director, a body corporate controlled by a director, or an entity connected with a director under the arrangement; or
  (b) in the case of an arrangement mentioned in section 504(1)(b) or (2)(b) in relation to any rights, obligations or liabilities under a transaction, a reference to the transaction.

(8) For the purposes of subsection (1)(a), it is irrelevant whether the resolution is passed before, on or after the commencement date* of this Division.

Section:

497

Value of transaction or arrangement etc.

(1) For the purposes of this Division
  (a) the value of a transaction is to be determined in accordance with subsection (2); and
  (b) the value of any other relevant transaction or arrangement is the value of the transaction or arrangement determined in accordance with subsection (2) or (3), reduced by any amount by which the liabilities of the director, the body corporate controlled by a director, or the entity connected with a director, for whom the transaction or arrangement was entered into have been reduced.

(2) For the purposes of subsection (1)
  (a) the value of a loan is the amount of its principal;
  (b) the value of a quasi-loan is the amount, or maximum amount, that the person to whom the quasi-loan is made is liable to reimburse the person making the quasi-loan;
  (c) the value of a credit transaction is the price that it is reasonable to expect could be obtained for goods, land or services to which the transaction relates if they had been supplied (at the time the transaction is entered into) in the ordinary course of business and on the same terms (apart from the price) as they have been supplied, or are to be supplied, under the transaction; and
  (d) the value of a guarantee or security is the amount guaranteed or secured. (3) For the purposes of subsection (1)(b)
  (a) the value of an arrangement mentioned in section 504(1)(a) or (2)(a) is the value of the transaction entered into with a director, a body corporate controlled by a director, or an entity connected with a director under the arrangement; and
  (b) the value of an arrangement mentioned in section 504(1)(b) or (2)(b) in relation to any rights, obligations or liabilities under a transaction is the value of the transaction.

Section:

498

Total exposure amount

(1) In sections 509 and 510
total exposure amount(風險承擔總額) means
  (a) in relation to a company that is not a specified company, the aggregate of the amounts specified in subsection (2); or
  (b) in relation to a specified company, the aggregate of the amounts specified in subsection (3).

(2) The amounts specified for the purposes of paragraph (a) of the definition of total exposure amount in subsection (1) are
  (a) the amount of the transaction in question;
  (b) the aggregate of the amounts outstanding at the time that transaction is entered into, in respect of the principal and interest or otherwise, on every loan made by the company to a director of the company or of a holding company of the company, or to a body corporate controlled by such a director (excluding the transaction in question, and any loan made with the prescribed approval mentioned in section 500 or by virtue of section 499, 505, 506, 507, 508, 511 or 512);
  (c) the aggregate of the amounts representing the maximum liability of the company at that time under every guarantee given by the company, and in respect of every security provided by the company, in connection with any loan made by any person to a director of the company or of a holding company of the company, or to a body corporate controlled by such a director (excluding the transaction in question, and any guarantee or security given or provided with the prescribed approval mentioned in section 500 or by virtue of section 499, 505, 506, 507, 508, 511 or 512); and
  (d) the aggregate of the net amounts incurred or to be incurred by the company at that time under every arrangement specified in subsection (4) that is entered into by the company (excluding any arrangement entered into with the prescribed approval mentioned in section 504 or by virtue of section 499).

(3) The amounts specified for the purposes of paragraph (b) of the definition of total exposure amount in subsection (1) are
  (a) the amount of the transaction in question;
  (b) the aggregate of the amounts outstanding at the time that transaction is entered into, in respect of the principal and interest or otherwise, on every loan and quasi-loan made by the company to, and every credit transaction entered into by the company as creditor for, a director of the company or of a holding company of the company, or a body corporate controlled by such a director, or an entity connected with such a director (excluding the transaction in question, and any loan, quasi-loan or credit transaction made or entered into with the prescribed approval mentioned in section 500, 501, 502 or 503 or by virtue of section 499, 505, 506, 507, 508, 511 or 512);
  (c) the aggregate of the amounts representing the maximum liability of the company at that time under every guarantee given by the company, and in respect of every security provided by the company, in connection with any loan or quasi-loan made by any person to, or any credit transaction entered into by any person as creditor for, a director of the company or of a holding company of the company, or a body corporate controlled by such a director, or an entity connected with such a director (excluding the transaction in question, and any guarantee or security given or provided with the prescribed approval mentioned in section 500, 501, 502 or 503 or by virtue of section 499, 505, 506, 507, 508, 511 or 512); and
  (d) the aggregate of the net amounts incurred or to be incurred by the company at that time under every arrangement specified in subsection (5) that is entered into by the company (excluding any arrangement entered into with the prescribed approval mentioned in section 504 or by virtue of section 499).

(4) An arrangement specified for the purposes of subsection (2)(d) is
  (a) an arrangement under which
    (i) another person makes a questionable loan to
      (A) a director of the company or of a holding company of the company; or
      (B) a body corporate controlled by such a director; and
    (ii) that other person, pursuant to the arrangement, has obtained or is to obtain any benefit from the company or an associated company of the company; or
  (b) an arrangement for an assignment to the company, or assumption by the company, of any rights, obligations or liabilities under a questionable loan made by another person to
    (i) a director of the company or of a holding company of the company; or
    (ii) a body corporate controlled by such a director.

(5) An arrangement specified for the purposes of subsection (3)(d) is
  (a) an arrangement under which
    (i) another person makes a questionable loan or quasi-loan to, or enters into a questionable credit transaction as creditor for
      (A) a director of the company or of a holding company of the company;
      (B) a body corporate controlled by such a director; or
      (C) an entity connected with such a director; and
    (ii) that other person, pursuant to the arrangement, has obtained or is to obtain any benefit from the company or an associated company of the company; or
  (b) an arrangement for an assignment to the company, or assumption by the company, of any rights, obligations or liabilities under
    (i) a questionable loan or quasi-loan made by another person to
      (A) a director of the company or of a holding company of the company;
      (B) a body corporate controlled by such a director; or
      (C) an entity connected with such a director; or
    (ii) a questionable credit transaction entered into by another person as creditor for
      (A) a director of the company or of a holding company of the company; or
      (B) an entity connected with such a director.

(6) In this section
  (a) a reference to a questionable loan or quasi-loan made by a person to a director of the company, a body corporate controlled by such a director, or an entity connected with such a director, under an arrangement is a reference to a loan or quasi-loan (as the case may be) that, if it had been made by the company on the date of the arrangement, would have been prohibited by section 500(1), 501(1) or 502(1) or would have been so prohibited in the absence of sections 509 and 510;
  (b) a reference to a questionable credit transaction entered into by a person as creditor for a director of the company, or an entity connected with such a director, under an arrangement is a reference to a credit transaction that, if it had been entered into by the company on the date of the arrangement, would have been prohibited by section 503(1) or would have been so prohibited in the absence of sections 509 and 510;
  (c) a reference to a questionable loan or quasi-loan made by a person to a director of a holding company of the company, a body corporate controlled by such a director, or an entity connected with such a director, under an arrangement is a reference to a loan or quasi-loan (as the case may be) that, if it had been made by the company on the date of the arrangement, would have been prohibited by section 500(2), 501(2) or 502(2) or would have been so prohibited in the absence of sections 509 and 510; and
  (d) a reference to a questionable credit transaction entered into by a person as creditor for a director of a holding company of the company, or an entity connected with such a director, under an arrangement is a reference to a credit transaction that, if it had been entered into by the company on the date of the arrangement, would have been prohibited by section 503(2) or would have been so prohibited in the absence of sections 509 and 510.

Section:

499

Preservation of effect of members’ unanimous consent

(1) If, under a provision of this Division, a transaction or arrangement must not be entered into without the prescribed approval of a company's members, the provision does not prohibit the transaction or arrangement from being entered into with the unanimous consent of those members given before it is entered into.

(2) If, under a provision of this Division, a transaction or arrangement may be entered into with only the prescribed approval of a company's members, the provision does not preclude the transaction or arrangement from being entered into with the unanimous consent of those members given before it is entered into.

(3) For the purposes of subsection (1) or (2), it is irrelevant whether the unanimous consent is given before, on or after the commencement date* of this Division.

Subdivision:2

Prohibitions

Section:

500

Company must not make loan etc. to director or body corporate controlled by director

(1) Without the prescribed approval of its members, a company must not
  (a) make a loan to
    (i) a director of the company; or
    (ii) a body corporate controlled by such a director; or
  (b) give a guarantee or provide security in connection with a loan made by any person to
    (i) a director of the company; or
    (ii) a body corporate controlled by such a director.

(2) Without the prescribed approval of its members and the prescribed approval of the holding company's members, a company must not
  (a) make a loan to
    (i) a director of a holding company of the company; or
    (ii) a body corporate controlled by such a director; or
  (b) give a guarantee or provide security in connection with a loan made by any person to
    (i) a director of a holding company of the company; or
    (ii) a body corporate controlled by such a director.

(3) Despite subsection (2)
  (a) a company may enter into the transaction with only the prescribed approval of its members if the holding company is incorporated outside Hong Kong; and
(b) a company may enter into the transaction with only the prescribed approval of the holding company's members if it is a wholly owned subsidiary of the holding company, and the holding company is incorporated in Hong Kong.

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