Essentially, an annual general meeting (“AGM”) is a meeting held by the company once a year to update its members on its financial performance and allow members to engage in management. In general, AGM is a statutory requirement under the Companies Ordinance (Cap. 622). What is an AGM? An AGM generally has the following functions: To … Read more
Essentially, all businesses in Hong Kong must obtain a business registration certificate from the Inland Revenue Department (the “IRD”) and display a valid certificate at the place of business. Businesses in the form of sole proprietorship and partnership have to be registered with the IRD. Registration must be done within a month of commencement of … Read more
When starting a business, one of the most important steps is to select the right legal structure for your business. In Hong Kong, the most commonly-used business vehicles are sole proprietorships, partnerships and limited companies. Sole proprietorship A sole proprietor is also known as a sole trader. It is an unincorporated business where the business is owned … Read more
A Memorandum of Understanding (“MOU”) document sets out the preliminary terms of a commercial transaction agreed by the parties in the course of negotiations. This is often used to ensure both parties are on the same page as regards the major aspects of the transaction and prevent misunderstandings. It is also known as a heads … Read more
There are two common types of joint venture: Incorporated Joint Venture Contractual Joint Venture Small businesses may consider setting up a joint venture with a local enterprise in Hong Kong. Below are the different characteristics of incorporated and contractual joint ventures to enable you to choose the structure that best suits your requirements. Incorporated Joint … Read more
A joint venture can be understood as a short-term partnership that comes to an end once its purpose is served. There would be a specific task that the joint venture is established to complete, and the concert ends upon completion. On the other hand, a partnership is usually set up for conducting continuous business. Joint … Read more
A joint venture consists of two or more parties contributing resources to accomplish a specific business project. There are two main types of joint venture in Hong Kong: Incorporated Joint Venture where the joint venture is a separate corporate body and is registered with the Companies Registry in accordance with the Companies Ordinance. For more … Read more
If your company, unfortunately, goes insolvent, the relevant stakeholders, including the creditors, shareholders, liquidators, etc. can wind up the company. Alternatively, directors are given power by the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) to wind up the company under special circumstances. Creditors’ voluntary winding up Creditors’ voluntary winding up is similar in … Read more
A board resolution is a formal written document that records the decisions taken by the board of directors in a meeting. Board minutes are a list of actions and discussions that took place in a board meeting. If a board resolution is passed in a meeting, then the minutes will record the discussion and that … Read more
Put simply, there is no requirement as to board meetings to be convened or at any particular intervals unless required by the shareholder’s agreement or the articles of association. It is advisable to hold a board meeting whenever a significant matter needs to be approved/discussed. The director(s) must give reasonable notice to the rest of … Read more