Dormant Companies

1 What document should a company deliver to the Registrar of Companies for registration in order to declare the company dormant ?

According to section 5 of the Companies Ordinance, a private company may pass and deliver to the Registrar of Companies for registration a special resolution (specimen) declaring that the company will become dormant.

2 When will a company become dormant?

If a company passed a special resolution (specimen) declaring that the company will become dormant, the company is a dormant company as from:

the date of delivery of the special resolution to the Registrar of Companies; OR
any later date that is specified in the special resolution.

3 After the anniversary date of incorporation of my company this year, I delivered a special resolution declaring that my company would become dormant as from the date of delivery of the special resolution to the Registrar of Companies for registration. Do I need to deliver the annual return for this year for registration?

Under section 663 of the Companies Ordinance, the requirement to deliver annual return for registration does not apply to a dormant company. However, a private company is still required to deliver an annual return for the year in which it declares itself to be dormant if the effective date on which the company becomes dormant falls after the 42nd day after the anniversary of its date of incorporation.

4 How can a dormant company declares that it ceases to be dormant ?

According to section 5 of the Companies Ordinance, a dormant company ceases to be dormant if it passes and delivers to the Registrar of Companies for registration a special resolution (specimen) declaring that the company intends to enter into an accounting transaction.

5 When will a dormant company cease to be a dormant company?

A dormant company will cease to be dormant :

if a special resolution (specimen) declaring that the company intends to enter into an accounting transaction is delivered to the Registrar of Companies for registration; OR
if there is an accounting transaction in relation to the company.

6 What is an accounting transaction?

According to section 2 of the Companies Ordinance, “accounting transaction (會計交易)”, in relation to a company, means a transaction that is required by section 373 to be entered in the company’s accounting records, excluding a transaction arising from the payment of any fee that the company is required by an Ordinance to pay.

Please seek independent professional advice on whether a transaction falls within the definition of "accounting transaction" in section 2 of the Companies Ordinance.

7 If my company has delivered to the Registrar of Companies a special resolution declaring that the company intended to enter into an accounting transaction and ceased to be dormant this year, do I need to deliver the annual return for this year for registration?

A private company which has ceased to be dormant will be required to deliver an annual return for the year in which it ceased to be dormant if the effective date on which it ceased to be dormant falls on or before the 42nd day after the anniversary of its date of incorporation.

8 If a dormant company enters into an accounting transaction, will the company still be exempted from the delivery of annual return?

If a dormant company enters into an accounting transaction, the company ceases to be a dormant company. The exemption from delivery of annual return ceases to have effect on and after the date of the accounting transaction.

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