WHAT EXACTLY IS AN IMPORTANT CONTROLLERS REGISTER?

What exactly is An important Controllers Register?

What exactly is An important Controllers Register?

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For Hong Kong companies, one of the most important aspects to consider is transparency. Knowing the particular individuals who own, operate, and oversee companies in Hong Kong can help ensure that corporate ownership is handled legally and according to Hong Kong law.

For the Inland Revenue Department to known and quickly access the owners of a particular company, businesses must prepare and maintain the Significant Controllers Register (SCR) of their entity.

This article will break down the specifics regarding the Hong Kong Significant Controllers Register and how companies can make sure that they don’t face fines or legal action during their operations:

1. The Latest On The Hong Kong SCR Regime

2. Who Must Comply With The Significant Controllers Registry?

3. What Is Included In A Significant Controllers Registry?

4. Who Is A Significant Controller?

5. Where Should I Keep My Company SCR?

6. Who Can Access My Company Significant Controllers Register?

7. What Are The Penalties Of Failing To Comply With The SCR Regime?

8. When Do I Need To File My Significant Controllers Registry?

9. Why Should Work With A Company Secretary For Your SCR?

1. The Latest On The Hong Kong SCR Regime
In 2018, Cap. 622 of the Companies Ordinance 2018 was updated to requiring all Hong Kong companies to update and maintain their information in the Significant Controllers Register (SCR) regime. The information required to file and maintain in the SCR will include:

Information regarding the specific persons who have and maintain significant control over a Hong Kong incorporated company.
The required contact information and data allow for law enforcement officers to inspect a company upon demand.
The main purpose of this new obligation is to strengthen the transparency of company ownership and control. The SCR allows the authorities to identify and contact the person or the corporate who is in charge of making decisions for the company.

2. Who Must Comply With The Significant Controllers Registry?
Understanding what companies are required to file and register with the SCR is key to preparing to do business in Hong Kong. As the Hong Kong Significant Controllers Register regime continues to update, the companies and organizations required to be included in the registry are expanding.

Here are the main companies that are required to be part of the Significant Controllers Registry:

Any Hong Kong company that is limited by shares
Any Hong Kong companies limited by guarantee
Any unlimited companies in Hong Kong

In general, any company in Hong Kong that is operating as a business that is selling products or charging fees should be included in the SCR regimen to ensure that they are offering transparency to the Hong Kong authorities in their business dealings.

3. What Is Included In A Significant Controllers Registry?
What is included in a company’s entry in the Hong Kong SCR Regime? Here is a breakdown of the information you must be prepared to offer as part of the Significant Controllers Registry:

The name of the particular individual being recorded in the SCR.
The date that they became a significant controller of the company.
The nature of their significant control over the company.
The individual’s primary address and contact information, including:
Identification Card Number
Passport Information
The company’s information, including:
Registration Information
Place of Incorporation
Address & Contact Information
Information regarding the company’s designated representative.
Any other information required under Schedule 5C of the Companies Ordinance.

4. Who Is A Significant Controller?
In order for your company to complete the Significant Controllers Register, you must know your company’s significant controller. The significant controller is a registrable legal entity that has significant control over a particular company and a registrable person who has significant control over the company.

Typically, the individual who is designated as the significant controller will:

Hold at least 25% of the issued shares in the company
Hold at least 25% of the voting rights of the company
Have the right to appoint and remove a majority of the board of directors
Have the right to exercise significant control over the company’s operations
5. Where Should I Keep My Company SCR?
Once you Significant Controllers Register have completed your SCR, you must keep a copy of the file on record at the registration office of your company or organization within the Hong Kong territory. Thankfully, companies may keep either a hard copy or an electronic version of SCR at their location.

6. Who Can Access My Company Significant Controllers Register?
A Hong Kong company that is required to keep a current SCR must make the registry available to the following individuals or entities upon request:

Hong Kong Monetary Authority
Hong Kong Police Force
Companies Registry
Customs and Excise Department
Immigration Department
Independent Commission Against Corruption
Securities and Futures Commission
Inland Revenue Department
Insurance Authority

7. What Are The Penalties Of Failing To Comply With The SCR Regime?
Should a Hong Kong business fail or refuse to comply with the SCR Regime, it may face potential legal ramifications as well as fines.

Not complying or keeping inaccurate information in the Significant Controllers Register could face a criminal level 4 offense and potentially pay nearly $25,000 or more in fines.

8. When Do I Need To File My Significant Controllers Registry?
Companies who are required to file with the Hong Kong SCR regime will receive notice of their need to file – and must complete the process within a month of their initial notice.

When a Hong Kong company begins the process of completing their SCR process, they will have seven days to include the particular individual’s information who is to be included in the SCR. If you have any changes to make to your SCR, you have another seven days to update the information with the proper authorities.

Should you need to destroy a record from the significant controllers register, that individual can be removed after six years from the date they were initially included in the registry.

9. Why Should Work With A Company Secretary For Your SCR?
When you are in need of fast and effective significant controllers register expertise, partner with a company secretary that can walk you through each step of the process.

If you are looking to partner with a company secretary who has years of experience helping Hong Kong companies prepare and maintain their SCR, contact Fastlane today. Working with Fastlane can help you speed up the process of preparing your significant controllers register, and help you avoid potential legal issues.

Fastlane can also help with various other company secretary services – including Hong Kong business registration and legalization paperwork and filing.

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