Q:
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What should the company do if a new director to be appointed?
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A:
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Before an appointment of director is made, the company must check its articles of association (“AA”) for any restrictions and requirements such as:
the maximum number of directors;
the method allowed to appoint the new director;
whether the director is required to hold any qualification shares;
whether there are any professional qualification requirements to a director;
whether there are any categories of directors and the new director belongs to which category and the relevant method to appoint such category of director; and
whether there is restriction on the terms of services of a director.
Depends on the requirements and procedure written on the AA, the company may by board meeting, general meeting or both to appoint such person as the company’s new director. After the approval from the board or general meeting, the company needs to update its register of directors to record the information of the new director and arrange to deliver a Notice of Change of Company Secretary and Director (Appointment/Cessation) (“Form ND2A”) to the Companies Registry of HKSAR (“CR”) for registration within 15 days after the date of appointment. Submission of Return of Allotment (“Form NSC1”) or stamped transfer of shares documents may be required if a share qualification is required as per the AA.
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Q:
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What should the company do if a director resigned from his position?
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Upon receiving the letter of resignation from a director, the company shall first check its AA to confirm the minimum number of directors required and whether the quorum can be met or not after the director’s resignation. Then, the company shall convene and hold a board meeting to note the resignation and, then arrange to deliver a copy of Form ND2A to CR for registration within 15 days after the resignation. Finally, the company must update its register of directors to record the resignation.
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Q:
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What should the company do if the director of the company needs to be removed?
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A:
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To remove a director, special notice to propose a resolution for removal of the director needs to be given by present members of the company.
On receipt of special notice of proposed resolution to remove a director, the company must forthwith send a copy of the same to the director concerned. That director may then make written representation to the company.
The notice of the meeting needs to be given to all the directors and members of the company and physical meeting is required (written resolutions are not allowed). Removal of director is allowed only in general meeting by an ordinary resolution of shareholders. The concerned director is also entitled to receive notice of and to attend the general meeting. At such general meeting, he must be given the right to be heard before the decision. Once the removal is confirmed, the company must deliver a copy of Form ND2A to CR within 15 days after the passing of the ordinary resolution and update the register of directors.
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Q:
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When a director of the company resigns, is it necessary for the resigning director to notify or file any Form with CR?
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If the resigning director has reasonable grounds to believe that the company will not report his/her resignation to the CR, the resigning director can notify the CR by filing a Notice of Resignation of Company Secretary and Director (“Form ND4”).
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Is the incoming director required to provide his consent to act as the director to the company?
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The incoming director must sign a letter of consent to act as director and provide the same to the company. Further, he/she must sign on the part of consent to act in the Form ND2A which will later be submitted to CR for registration.
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Is there any deadline for the filing of the Form ND2A with CR?
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Form ND2A needs to file within 15 days of the effective date of change of director with CR.
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Who is the qualified person to execute Form ND2A if the resignation of an existing director and the appointment of a new director effective on the same date?
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For the company has only 1 director, the new director shall sign and execute the Form ND2A for submission, while for the company has more than 1 director, any one of them shall sign and execute the form. Such form can also be signed by Company Secretary.
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FAQ
