Company Formation: Limited Company
In this new series, we will dive into the more business essential part: Company Formation. How and what you will need to know before opening a company in Hong Kong? What are the different types of business or company you could register? And what are their differences? These are all aspects you must know before progressing to company formation, and OneStart Business Centre is here to help you get to know them one by one.
There are mainly two different types of company: Limited Company (LC) and Unlimited Company (UC). We will first shed lights on what is a limited company and everything you need to know about it.
In 2021, According to the data issued by the Companies Registry, there are a total of 110,840 private companies incorporated throughout the whole year. Why would people choose to incorporate a limited company?
A Limited Company is a corporation that is established by one or more shareholders. The amount of liability undertaken by the company's shareholders are limited in a limited company. In this form of business, the limited company itself is regarded as a legitimate person, and would need to bare some responsibility for itself, sharing the liabilities with the shareholders.
You can file your business as a limited company through OneStart Business Centre easily, but what is the benefits of filing as a limited company?
Limited Company as a separate entity: shareholders assets distinct from the company's losses
The liabilities that shareholders of a Limited Company registered in Hong Kong would only need to bear the losses that are limited to what they have invested. Your own assets and income would be completely separate from the limited company, meaning even when your company goes bankrupt, you would not have to sell your house to repay for it. Thus, this is what it meant by limited liability.
Limited Company bares contracts risks
As the limited company can be regard as a person, it can enter into contracts on its own. Therefore, filing as a limited company could also ensure shareholders to bear less risk over and financial distresses or legislation responsibilities of contracts.
Easy transfer of Limited Company's ownerships
Because of this separate entity of the limited company from the shareholders, the ownership of a limited company can be easily transferred. You might remember seeing board of directors leading a company in different television dramas, and they are fighting over the ownerships by gathering enough shares. In fact, a limited company can be owned by one or more shareholders, and be managed by more than one director. These are all governed by the company's own rules and law.
As regulated by the Hong Kong Companies Ordinance, all the Limited Company registered in Hong Kong must appoint at least one Company Secretary. This company secretary is not the one making coffee and handling meeting minutes for you, the responsibilities are strictly defined by the ordinance. OneStart Business Centre has a professional team dedicated to offer you with our company secretary service. Responsibilities of a company secretary are listed as follows:
l Submit Annual return and other required forms to the Companies Registry on a regular basis
l Provide the meeting information to formulate the internal meeting records and resolutions, basing on the company directors/shareholders
l Print company stock to the shareholders
l Update records of the company
Registration and filing as a limited company through OneStart Business can be completed within 2 days. After your provision of the related documents, we will handle the rest of the company formation procedures for you. Incorporation services at OneStart Business Centre could offer you with a one-stop professional business services package, including company secretary services. Our packages come with all sorts of business essentials, click here to check it out!
Interested in OneStart Business Centre's Company Incorporation and Company Secretary services? Phone in to our hotline 3575 6888 or WhatsApp our helpful consultants!