The Companies (Amendment) Ordinance 2018 and the Anti-Money Laundering and Counter-Terrorist Financing (Financial Institutions)(Amendment) Ordinance 2018 (the “Significant Controllers Regime”) have come into effect from 1st March 2018.

The Significant Controllers Regime requires all companies to keep a Significant Controller(s) Register (‘the Register”) to record corporate beneficial ownership. The following are a brief summary of the requirements of the Register extracted from the Significant Controllers Regime:-

• All companies incorporated in Hong Kong with or without share structure, except listed companies and exempted companies, are required to take reasonable steps to ascertain and identify the individuals and legal entities that have significant control over the company and to maintain the Register with accurate and updated information.
• The Register must be kept in the English or Chinese Language.
• The Register must be maintained at its Registered Office or a prescribed place and the Companies Registry must be notified of the place at which the Register is kept.
• For a company that has no significant controller, it is still required to maintain the Register.
• The Register is not a public record and is only available for inspection by persons whose names are entered in the Register or on demand by any law enforcement officer.
• Law enforcement officer including but not limited to office of Companies Registry, Monetary Authority, Police, Immigration Department, Inland Revenue Department, ICAC, and SFC.
• Company must designate at least one representative to serve as a contact point for providing information about the Register and to facilitate and assist it to comply with its duties in relation to the new requirements.
• If a company fails to keep the Register, the company as well as every responsible person of the company may be held for the offense.

Significant Controllers (“the Controllers”)

The Controller means, amongst others, either a natural person or entity that has significant control over the company; or a legal entity that is a member of and has a significant control over the company.

The following are the rules set out by the Significant Controllers Regime to determine significant influence or control:-

• A person holds, directly or indirectly, more than 25% of the issued shares, rights, or share of profit in the company.
• a person holds directly or indirectly, the right to appoint or remove a majority of the Board of Directors of the company.
• A person has the right to exercise, or actually exercises, significant influence or control over the company. Significant influence or control may be exercised through a trust or a firm, whose trustees or members satisfy any of the above conditions (in their capacity as such) in relation to the company.
• A share held by a nominee for another person is regarded as being held by that other person.

Designated Representative (“the Representative”)

The following are the rules set out by the Significant Controllers Regime for the responsibilities of the Representative:-

• A company must designate at least one person as its representative to provide assistance relating to the company’s significant controllers register to a law enforcement office.
• The Representative must be either a shareholder, director, or an employee of the company who is a natural person resident in Hong Kong; or an accounting professional, a legal professional or a person licensed to carry on a business as trust or company service provider.
• The particulars of the Representative should be entered into the Register.

Our Services

As a Licensed Trust or Company Service Provider, Devonshire has full capability to act as the Representative and provide our services to clients in compliance with the aforementioned requirements set out by the Significant Controllers Regime.

Our services as the Representative will cover the following list of services:-

• Review the Company’s register of members, Articles of Association, Shareholders Agreements or other agreements to ascertain whether there is/are any Significant Controller(s).
• Issue notices to any person who is believed to be a Significant Controller and any person who is believed to know the identity of the Significant Controller, if applicable.
• Prepare the Register and enter the required particulars into the Register.
• Deliver the prescribed Form NR2 to the Companies Registry to report the location of the Register, if applicable.
• Maintain and update the Register from time to time.