Closing down a company in Hong Kong involves a certain number of formal steps and the overall process can take around 6 months to complete as it depending on how the company is being closed and the complexity of the case.
There is 2 ways of closing down a company, deregistration or winding up. Deregistration is a relatively simple, inexpensive and quick procedure for dissolving defunct companies who meet certain specific requirements. Winding up is the process of appointing a liquidator who will settle the accounts, pay off the company’s debts (if any), liquidate the assets of a company and distribute the surplus assets (if any) to members, ensuring that the company is completely dissolved.
De-registration a Hong Kong Company: Requirements
The company must be a solvent private company incorporated under the Hong Kong Companies Ordinance, and must meet the following requirements:
- All the members of the company agree to the deregistration
- The company has never commenced business or operation, or has ceased to carry on business or ceased operation for more than 3 months immediately before the application
- The company has no outstanding liabilities
- It has obtained a written notice of no objection from the Commissioner of Inland Revenue
Winding up a Hong Kong Company
There are two ways to winding up a company in Hong Kong
1.Voluntary Winding Up
Voluntary winding up of a Hong Kong company can be initiated either by members (shareholders) or creditors. The voluntary winding up of a company begins by a special resolution being passed for the company to be voluntarily wound up and publishing this information in the Gazette within 14 days. The winding up is said to begin on the date on which the resolution is passed.
2.Compulsory Winding Up.
The most common circumstances under which a Hong Kong Court can order a compulsory winding up of a company in Hong Kong are:
I.The company is unable to pay a debt of HKD 10,000 or above
II.The court is of the opinion that it is just and equitable that the company should be wound up
III.The company has by special resolution resolved that the company be wound up by the court
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