If you want to get rid of a solvent company, you can apply for “deregistration” in accordance with the provisions of section 291AA of the Companies Ordinance. Deregistration is easier and less expensive than “liquidation”. The whole process takes 6-9 months.
Deregistration may not be entertained unless the company has filed all its Annual Returns, notices of changes in registered office or directors and secretary, etc.
Deregistration is commenced by application in the specified Form DR1 which states the grounds for application being that:
- all shareholders agree to deregistration;
- the company has no outstanding liabilities; and either
- the company has ceased operation for at least three months prior to the application; or
- the company has never commenced business or operation.
Application must be accompanied by a statement from the Inland Revenue Department (“IRD”) confirming that the Commissioner of the IRD has no objection to deregistration. This statement may be issued upon request and payment of the required fee.
The issue of this certificate is dependent upon the company satisfying the Commissioner of the IRD that there are no outstanding tax liabilities and application for deregistration should be made within 3 months of the issue of the Revenue’s confirmation.
Once a company is deregistered, all property (including balances in the company’s bank account) held prior to its deregistration shall be deemed to be “bona vacantia” (ownerless property passing to the Government) and shall belong to the Hong Kong Government.
According to s292(3) of the Companies Ordinance, a person who was a director of a company immediately before its deregistration must ensure that all the books and papers of the company are kept for not less than 5 years after the dissolution.