Key Business Terminology in Hong Kong

Have you decided to set up a business in Hong Kong? Then, it’s a good idea to familiarize with some important terminology. This section provides a brief and detailed overview of the basic terminology necessary for every entrepreneur in Hong Kong.

Startupr will guide you through key areas, including navigating mandatory annual compliance requirements and ensuring your documentation is internationally legally valid.

What is the most Common Business Terminology in Hong Kong?

In this section you will find an overview of the most common terms and terminology in the field of entrepreneurship and business. We have also written a separate article for each term if you need to learn more.

Annual General Meeting (AGM)

In Hong Kong, most companies need to have a yearly meeting called an Annual General Meeting (AGM). At this meeting, the company’s owners (shareholders) look at how the company did over the last year and make important choices.

It’s important for companies to know the rules about AGMs, like when they need to happen and how they should be run. This helps them follow the law and be a well-managed company.

Hong Kong Annual Return (NAR1)

Every year, companies in Hong Kong (except those that aren’t doing business) need to send a form called the Annual Return (NAR1) to the Companies Registry. This form tells the government about the company. It includes things like where the company is located, who the directors and secretary are, and information about the company’s shares.

It’s important to send the NAR1 on time and make sure the information is correct. This keeps the company legal and helps avoid fines.

Apostilled Documents in Hong Kong

When you engage with businesses or laws in other countries, those entities might require formal recognition of your Hong Kong-issued documents’ authenticity. Therefore, you may need to have your documents formally recognized abroad.

Apostilled Documents undergo a specific certification process by the High Court in Hong Kong, confirming their genuineness for use in countries that are signatories to the Hague Convention.

Business Registration Certificate

The Business Registration Certificate (BRC) is a fundamental document required for any individual or entity carrying on business in Hong Kong. Issued by the Inland Revenue Department (IRD), the BRC serves as proof of legal registration and is necessary for various business activities, including opening a bank account and filing tax returns. Renewing your BRC annually is a key compliance requirement.

Hong Kong Certified Copies

In various official processes in Hong Kong, such as submitting documents to government bodies or financial institutions, you may be required to provide Hong Kong Certified Copies of original documents. These are copies that have been officially verified as true and accurate by a designated professional, such as a lawyer or a certified public accountant. Understanding the requirements for certified copies ensures your submissions are accepted without delays.

Commencement of Business in Hong Kong

The Commencement of Business in Hong Kong means the official start of your company after incorporation and obtaining the necessary licenses and permits. In essence, starting your business in Hong Kong means you’re officially open for business. You can do this after you register your company and get all the required licenses and permits. Therefore, it’s important to know the legal rules and what you need to do to get your business running smoothly and stay within the law.

Company Secretary

Hong Kong law requires every private limited company to appoint a Company Secretary. Essentially, this individual or corporate entity plays a vital role in ensuring the company complies with the Companies Ordinance, including maintaining statutory records, filing necessary documents with the Companies Registry, and organizing meetings. Consequently, understanding the responsibilities and requirements of a company secretary is essential for proper corporate governance.

Profits Tax Return

Profits Tax Return filing is an annual obligation for businesses operating in Hong Kong that have generated assessable profits during the financial year. Understanding the tax regulations, allowable deductions, and the process for completing and submitting your Profits Tax Return to the Inland Revenue Department (IRD) is crucial for compliance and effective tax planning.

Proxy (De-registrar)

In Hong Kong corporate governance, a proxy designates an individual authorized by a shareholder to represent them and exercise their voting rights at company meetings. Consequently, familiarity with the regulatory framework and procedures governing proxy appointment is crucial for shareholders unable to attend meetings in person, enabling them to participate effectively in corporate decision-making. The term “De-registrar” is not a standard business terminology in Hong Kong. Instead, this might refer to the process of deregistering or winding up a company, which involves specific legal procedures.

Hong Kong Registered Address

Every company incorporated in Hong Kong must have a Hong Kong Registered Address. Specifically, this is the official address to which all statutory communications from government bodies, including the Companies Registry and the Inland Revenue Department, will be sent. Therefore, maintaining a valid and accessible registered address is a fundamental legal requirement.

Share Capital in Hong Kong

Share Capital in Hong Kong represents the funds raised by a company through the issuance of shares to its shareholders. Therefore, it is crucial for business owners and investors to understand the different types of share capital, the regulations surrounding their issuance and transfer, and their implications for company structure and liability.

Virtual Office For Hong Kong Company

A Virtual Office For Hong Kong Company provides businesses with a professional business address and related services without the need for a physical office space. This can be a cost-effective solution for startups and businesses with remote teams. Furthermore, it fulfills the legal requirement of having a Hong Kong Registered Address and provides access to essential administrative support. Therefore, it offers a practical and compliant option for many businesses.

Startupr’s Guide to Hong Kong Business Terms: Your Foundation for Success

Startupr has been helping entrepreneurs in Hong Kong for over 14 years. During that time, helped more than 22,000 companies. We are a team of experts for incorporating a business in Hong Kong, accounting and banking consulting. Also, Startupr offers a number of additional services for new and existing clients.

This overview of Hong Kong terminology will help you to have a better overview. If you need advice on your business, do not hesitate to contact us. We look forward to hearing from you!