The Certificate of Incorporation provides legal recognition and credibility, ensures limited liability protection for shareholders or members, and is essential for facilitating business transactions and compliance.
A Certificate of Incorporation is a legal document that signifies the existence of a company, akin to a birth certificate and serves as a license for a company to operate.
A certificate of Incorporation is issued by the Companies Registry, serves as the company's ID, and does not expire. On the other hand, the Business Registration Certificate, issued by the Inland Revenue Department, serves as the tax ID and has an expiry date.
Incorporation refers to the legal process for establishing a company in any jurisdiction.
The relevant authority that oversees the process issues a certificate that serves as evidence that the company has been set up under the requirements of law.
Hong Kong law also requires local and foreign companies to follow the incorporation process and obtain a certificate of incorporation. This guide tells you everything you need to know about getting one.
What Is a Certificate of Incorporation?
A certificate of incorporation is a legal document that records the date from which a company comes into existence. You can think of it as a birth certificate for companies. Since a government authority issues a certificate of incorporation, it also serves as a license for a company to operate.
In Hong Kong, only limited liability companies need a certificate of incorporation and the Companies Registry issues it. The certificate follows a standard format and contains information in English and Chinese.
Note that an incorporation certificate is different from acquiring a certificate of incumbency which contains the details of your company structure and validates its legal status. Moreover, while any independent third party can issue an incumbency certificate, only the Companies Registry has the power to issue a certificate of incorporation.
Additionally, incorporation certificates issued by the Hong Kong Companies Registry are only valid in Hong Kong. You need a separate certificate of incorporation in case you want to set up a company in Mainland China.
Information Within a Certificate of Incorporation
Your Hong Kong certificate of incorporation carries the following information:
Company Registration Number
Your Company Registration Number is a unique 7-digit number printed on the top left corner of the incorporation certificate.
This number acts as the ‘social security number' of your company and is used for identifying your company in official and government records.
Effective January 2024, a company's Business Registration Number will also be known as its Unique Business Identifier (UBI). This number will be prominently displayed on both the Business Registration Certificate and the Certificate of Incorporation.
Additionally, the Business Registration Number or UBI will now also serve as the company's Tax Identification Number (TIN).
Official Name
The company's name appears in the middle of the certificate of incorporation.
Incorporation Date
The date on which the existence of a Hong Kong company is officially entered in the records of the Companies Registry also appears on the incorporation certificate. It is above the signature of the Company Registrar.
This serves as the date of incorporation of the company.
Ordinance Type
A specific section of the Companies Ordinance provides for the issuance of a certificate of incorporation to limited liability companies in Hong Kong.
The incorporation certificate mentions the same to prove that the business is indeed a limited liability company.
Certificate Type
The words ‘Certification of Incorporation' is printed right on top, below the logo of the Companies Registry.
This is a piece of important information as there are several other certificates such as ‘Certificate of Continuing Registration' and ‘Certificate of Registration as a Trust Company' that look similar to an incorporation certificate but serve a completely different purpose.
Company Registrar's Name
Since the company registrar issues the incorporation certificate, their name also appears on the certificate.
Why Your Company Needs a Certificate of Incorporation
A certificate of incorporation validates the existence of a company.
It is a legal document that proves that your company has followed the due process of setting up a company as per the laws of the place where it intends to carry out business.
In fact, if you want to open a business bank account or apply for financial assistance or raise money from investors, you need to submit your certificate of incorporation.
Incorporating a company is advantageous for any business, as it:
- Establishes a distinct legal liability of the business and separates business assets from your assets
- Provides you with tax benefits
- Helps maintain the perpetual existence of your business so that it remains unaffected by the death of the owner
Difference Between a Certificate of Incorporation and a Business Registration Certificate
Any business that generates profit (including sole proprietorships, partnerships, branch offices, and representative offices) needs registration with the Inland Revenue Department.
As part of the registration process, the Department issues a business registration certificate. Along with other details, the certificate also carries a unique 8-digit number known as the business registration number.
As per Hong Kong law, overseas companies doing business in the region need to register within 30 days of the commencement of operations. Failure to register on time attracts hefty fines.
Here are the key differences between a business registration certificate and a certificate of incorporation:
- While a certificate of incorporation contains the company registration number which serves as the company ID, a business registration certificate grants the business registration number which serves as the tax ID of the company.
- A certificate of incorporation doesn't have an expiry date but a business registration certificate is only valid till the date specified on it.
- Even though the approval process of both certificates goes on in parallel, the issuing authorities are different. Companies Registry issues a certificate of incorporation whereas the business registration office of the Inland Revenue Department issues a business registration certificate.
- You can verify the authenticity of a certificate of incorporation using the Integrated Companies Registry Information System. But there is no such registry or platform available to verify the authenticity of a business registration certificate.
- The law mandates that businesses display their business registration certificate in a conspicuous place. However, there is no requirement to display the certificate of incorporation.
How Can You Obtain a Certificate of Incorporation?
Here's what you need to do to obtain a certificate of incorporation:
Choose the Type of Company You Want to Incorporate
There are two types of limited liability companies you can choose from: you can either opt for a company limited by shares or a company limited by guarantee.
A company limited by shares means that the shareholder's liability is limited to the capital it holds in the company. As per the Hong Kong Companies Ordinance, there is no minimum share capital required for incorporating a company limited by shares.
In a company limited by guarantee, each member acts as a guarantor for liabilities of the company for a specified amount.
Choose a Name for Your Company
Decide on a name for your company. It can be either in English or in Chinese.
If you want to incorporate a company with a Chinese and an English name, both names will appear on the certificate of incorporation and act as the formal name of the company.
Ensure that the name is per the company name guidelines and is not in use already by other Hong Kong companies.
Fill In the Application Form
Fill in the relevant details in your incorporation form.
The fact that you need to fill in the details of your company secretary in the form highlights the importance of having a company secretary before you begin the incorporation process.
You also need to attach a copy of the Articles of Association of the company and the Notice for Business Registration to the Inland Revenue Department along with the form.
Submit the Documents and Pay the Applicable Fees
You can submit the form and supporting documents either online or in person at the Company Registrar's office.
The fees vary depending on the mode of submission and whether the company is limited by shares or guarantees.
Receive Your Certificate
In case of online submission of forms and documents, you will receive an electronic copy of the certificate of incorporation within an hour of submission.
In case of in-person submission, a hard copy of the certificate of incorporation is available for pick up within 4 working days of submitting the form.
Bottom Line
As a limited liability company, a certificate of incorporation forms part of the constitutional documents that are necessary for a corporate entity that wants to do business in Hong Kong.
Want to get your company incorporated and get a certificate but unsure how you can get started?
Contact Air Corporate today. Our experienced team can guide you through the entire process of company incorporation.
FAQs
A certificate of incorporation remains valid till the company remains in existence. That’s why there is no expiry date specified.
If the company files for winding up or dissolution, the certificate of incorporation ceases to be valid.
You can order a certified copy of the certificate through the Companies Registry’s Cyber Search Centre or Company Search Mobile Service.
This service is available on payment of additional fees.
You can use the Companies Registry’s online system ICRIS (Integrated Companies Registry Information System) to verify whether a company has an incorporation certificate.
This is a bilingual platform that allows you to confirm basic information about a company such as its date of incorporation and if there has been any change of name.
But you cannot download a copy of the incorporation certificate from ICRIS.
