Everything You Should Know Before Choosing Your Company Secretary

What is a Company Secretary?

Company secretary in Hong Kong is the business’s official representative and must follow legalities to keep the company running smoothly. The company representative known as a “secretary” has many duties that go beyond clerical work.

What you will learn:

1. Who can be Appointed as Company Secretary for Your Company?

2. Why is a Company Secretary in Hong-Kong so Important?

3. What are the Responsibilities of a Company Secretary?

        3.1 Ensure Tax Compliance

        3.2 Keep Track of the Company’s Statutory Books

        3.3 File after Incorporation 

        3.4 Meet the Needs of All Interested Parties

4. Qualities to Look For When Choosing Your Secretarial Service Provider in Hong Kong

        4.1 Qualifications and Experience in Corporate Governance

        4.2 In-Depth Local Knowledge and Worldwide Experience

        4.3 A Broad Service Offering that is Tailored to Your Company’s Requirements

        4.4 Ability to Progress with Your Company

5. How Can FastLane Help?

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Who can be Appointed as Company Secretary for Your Company?

You have two choices when hiring a company secretary for your business in Hong Kong.

1. Appoint an Individual

Any individual who resides in Hong Kong can be appointed as a company secretary. However, according to the law, you are not required to hire a professional, although this is strongly advised. Both the company and the company secretary have certain responsibilities and potential liabilities. Appointing a friend as company secretary is not recommended. 

2. Appoint a Professional Corporation 

If that is the case, then it must be registered in Hong Kong and hold a TCSP license issued by the Registry. Last, if a company is listed on the Hong Kong Stock Exchange, it needs to appoint a Chartered Company Secretary (non-listed companies don’t have to do this). If a company has only one director, that person cannot also serve as the Company Secretary.

Why is a Company Secretary in Hong Kong so Important?

The company secretary is a crucial part of any business in Hong Kong, as they take on many responsibilities that go beyond simply ensuring the company adheres to its obligations. There are several key reasons why you should consider hiring a company secretary.

What are the Responsibilities of a Company Secretary?

The duties of your hk company secretary in Hong Kong vary from managerial to administrative. Some responsibilities include:

1. Ensure Tax Compliance

When you hire a competent hong kong company secretary in Hong Kong, one of his/her key responsibilities is to help you comply with the tax code. The Hong Kong government is very direct when it comes to taxes. Company secretaries have various tax-related responsibilities, a few of which are listed below:

• Register your company with Inland Revenue Department (IRD) after incorporation
• Seek additional authorization for the business on tax matters
• Aids in the completion of your firm’s tax returns at the close of each financial year, to ensure you benefit from tax cuts and avoid penalties

2. Keep Track of the Company’s Statutory Books

The business secretary is obligated to maintain all legal paperwork when you form a company in Hong Kong. The government agencies obtain direct and simple access to the requested material through this system, for example, the company secretary is contacted by the IRD when there is a problem with company tax compliance.

Although it may seem outdated, the hk company secretary is still required to update the records if their personal information changes. For example, if a shareholder increases his/her shares in the company, the secretary should update both the register of shareholders and directors. The secretary is responsible for not only keeping the shareholders up to date with company operations, but also distributing different reports and accounts.

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3. File after Incorporation

No matter what structure you selected for your Hong Kong company during incorporation, it’s likely that you will eventually need to make changes to the setup. Some changes a company may go through include removing or adding shareholders or directors, changing the company name, increasing/decreasing the company’s share capital, or altering the registered address. The company secretary in Hong Kong is required to prepare and file the necessary documents whenever there are changes within the company.

4. Meet the Needs of All Interested Parties

In addition to these tasks, the hong kong company secretary is required to collaborate with a variety of parties. The secretary must collaborate closely with agencies whose job it is to impact the company’s day-to-day operations. The secretary can stay up to date on new policies, regulations, and prompt actions that are needed by working with various organizations. These may include the Hong Kong Stock Exchange, the IRD, and the Companies Registry. In addition to collaborating with directors and shareholders, the secretary also has to work with other officers in the company.

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Qualities to Look For When Choosing Your Secretarial Service Provider

Outsourcing your company secretarial needs to a professional service provider may relieve your employees of the time-consuming administrative burden of corporate compliance in the present. It may also assist you in saving money by freeing up key personnel to concentrate on your company’s core activities. 

If you fail to meet legal obligations, your company could face major financial penalties, damage to its reputation, and even lawsuits. It is essential to partner with an experienced, qualified and knowledgeable corporate secretarial service provider.

Here are the 4 things to search for while selecting a secretarial support firm in Hong Kong:

1. Qualifications and Experience in Corporate Governance

Every business in Hong Kong is required to have a company secretary. A person who is a resident of or who has a company registered office or principal place of business in Hong Kong must apply for the position. A director in a private firm may act as the hong kong company secretary unless they are the only director. Having a director fill the position of company secretary may save money in the beginning. However, as your company expands, the corporate governance requirements will also increase.

Many private companies instead choose to outsource their company secretarial duties; while the role requires professional specialist knowledge, it doesn’t usually warrant creating another in-house position. Oftentimes, outsourcing is the best option in terms of both efficiency and cost-effectiveness, though it is not required.

The responsibilities of a company secretary are more strict for public companies. Under the Hong Kong Stock Exchange Listing Rules, a person or company must have appropriate professional or academic credentials or sufficient experience to be qualified.

These professional or qualifications are considered “Suitable” under the Listing Rules:

• Member of The Institute of Chartered Secretaries
• A solicitor or barrister under the Legal Practitioners Ordinance
• A certified public accountant under the Professional Accountants Ordinance

The proposed hk company secretary’s experience is considered “Relevant” if it falls within one of these categories:

• Length of time worked for the firm
• Previous company secretary responsibilities
• Understanding of the Listing Rules and other pertinent legislation
• Completed or ongoing relevant training
• Professional qualifications in other jurisdictions

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2. In-Depth Local Knowledge and Worldwide Experience 

A company secretary who knows the ins and outs of local regulations is a priceless asset to your organization, as culture, tradition, and customs can be just as important as the law. 

If your company is international – or even global, you need a company secretary who understands your legal obligations and can help manage them. Without the right knowledge on your side, the subtle changes in both legislation and best practices throughout various nations may be overlooked. Maintaining relationships with the right people could help you prevent any size of financial implications.

3. A Broad Service Offering that is Tailored to Your Company’s Requirements

As your company expands, outsourcing non-core functions to a single corporate expert provider may help you save time and energy while allowing your key personnel to focus on company strategy and performance. At FastLane, we provide a comprehensive range of corporate services under one roof, including accounting, audit, payroll, hong kong company secretary and more. We help you get back to work while we handle the time-consuming, operational duties so you can focus on what matters most.

We can help you accurately and quickly:

• Preparing income statements, balance sheets, and cash flow statements with our comprehensive accounting services
• Filing your company’s taxes
• Processing payroll quickly and efficiently, including payment instructions, generating salaries, statutory reports, bank payments and electronic payslips, and more…

4. Ability to Progress with Your Company 

What are your long-term goals for your firm? If you’re considering going public, your secretarial services company will need the know-how to help you navigate through Hong Kong’s Initial Public Offering (IPO) procedure.

Consider what would happen if your company decided to expand. In that scenario, you must be aware of the many specific compliance standards involved. You must also expect to spend a significant amount of time on paperwork and administration in order for the change to take place.

Look for a corporate secretarial services business like FastLane, which provides a wide range of corporate services in whatever path you choose to go down with your firm. Only with this degree of flexibility can the provider keep up with your company’s changing demands and grow with you.

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How can FastLane help?

FastLane Group is a licensed Hong Kong Trust Corporate Services Provider (TCSP) offering a wide range of company secretarial services.