Company filings and directors' addresses in Hong Kong
Jason Carmichael and Robert Rhoda, of Smyth & Co in association with RPC, consider the use of director correspondence addresses in HK
Jason Carmichael and Robert Rhoda
Just before Easter the government announced that those sections of the Companies Ordinance 2012 that restrict public access to company director residential addresses and full identification card numbers would not become operative when the law takes effect next year.
True to its word, the Companies (Residential Addresses and Identification Numbers) Regulation will not come into effect as subsidiary legislation insofar as directors are concerned for now. The government and the Registrar of Companies are said to be keeping an open mind, while different stakeholders are consulted on the need for transparency and protection of personal data.
We understand that new provisions that restrict public access to company secretary residential addresses will go ahead. It seems clear that, as far as directors are concerned, the new provisions restricting access are unlikely to come into effect for some time. In part, this may be because of strong opposition from some lawmakers, the Hong Kong Journalists Association and certain professional bodies.
Summary of suspended provisions
At present, when a director gives his or her address and Hong Kong identification card number (or passport number) on a company filing it should be a residential address and the full number.
The new provisions would allow a company director to apply to the registrar to restrict public access to his or her residential address and full identification card number. Instead, the director can provide a correspondence address.
The same is true for company secretaries. The proposal for identification card numbers is that the alphabet prefix and three digits be shown.
A director or company secretary would have to apply to have protected information withheld. Permitted classes of persons would be entitled to apply to the registrar to access the withheld information.
The registrar could, on conditions being satisfied, disclose withheld information to, among others: a shareholder, liquidator, trustee, designated public officer or body or "scheduled persons" (such as approved insurance brokers, a recognised clearing house or exchange company or exchange controller or investor compensation company).
The registrar could also make a residential address available in the case of unresponsive directors or ineffective correspondence addresses.
The new provisions give the High Court the power to order disclosure of withheld information in the case of ineffective correspondence addresses, or where it is "necessary or expedient" to do so to enforce a court order, and provided that it is appropriate to do so.
We have not noticed any great concern about filings using residential addresses. It is not clear why the new provisions created such controversy early this year, rather than when the bill was making its way through Legco in 2009-10.
There are over a million companies registered in Hong Kong and thousands of company searches are done every day. Many directors of these companies are not resident in Hong Kong. This, perhaps, calls into question the usefulness of some "usual" residential addresses. That is not to belittle the call for transparency.
The government and the registrar should be given credit for listening, as should those who mounted a spirited rearguard action. Their compromise should allow the Companies Ordinance to come into operation by the end of the first quarter of next year.
In the meantime, the government can continue to consult on the wider issue of privacy and access to data across areas such as vehicle registrations, land title ownership and business registrations. A good starting point might be to revisit some of the Law Reform Commission's work on privacy.
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