Following the passing of the Companies (Amendment) Bill 2017 on 24 January 2018, Hong Kong companies are required to obtain and maintain up-to-date beneficial ownership information through keeping a Significant Controllers Register (“SCR”) with effective from 1 March 2018 for internal records and inspection by law enforcement officers upon demand.
Significant controllers include:
- A “registrable person”, being a natural person or government or local authority international organisation who meets any one or more of the following conditions; and
- A “registrable legal entity”, being a local or an overseas entity which is a member of the company and meets one or more of the following conditions.
Five conditions for significant control over a company:
- The person holds, directly or indirectly, more than 25% of the issued shares in the company or, if the company does not have a share capital, the person holds, directly or indirectly, a right to share in more than 25% of the capital or profits of the company
- The person holds, directly or indirectly, more than 25% of the voting rights of the company
- The person holds, directly or indirectly, the right to appoint or remove a majority of the board of directors of the company
- The person has the right to exercise, or actually exercises, significant influence or control over the company
- The person has the right to exercise, or actually exercises, significant influence or control over the activities of a trust or a firm that is not a legal person, but whose trustees or members satisfy any of the first four conditions (in their capacity as such) in relation to the company
Contents of the SC Register
- For a registrable person: name, correspondence address, identity card number (if the person does not have an identity card, the number and issuing country of the passport);
- For a registrable legal entity: name, legal form, registration number, place of incorporation (governing law) and address of registered office;
- Date of becoming a significant controller; and
- Nature of control over the company.
Which are the compan(ies) require to complete the SCR?
- For Companies A, its SCR should include the particulars of:-
- Person 1 (indirect interest held through Companies B and C and its direct interest); and
- Company B
- For Company B, its SCR should include particulars of:
- Person 1 (indirect interest held through Company C); and
- Company C
- Under the condition of significant controller, the information of Person 2 (shareholding below 25%) is not required to be disclosed in Company A’s SCR.
- Company C is a non-HK company that SCR is not required.