New regulations on significant controllers register (SCR) and designated representative (DR)
Effective date of Companies Ordinance (Cap. 622) Amendment
Required for all non-listed companies
Each company must appoint at least one representative to assist law enforcement agencies
A Designated Representative (DR) is a person appointed under the relevant legal regulations to represent an entity in fulfilling certain statutory duties and assisting law enforcement officers in checking the register.
This requirement aims to enhance corporate governance transparency and combat money laundering and terrorist financing activities.
A designated representative must be a natural person resident in Hong Kong who meets one of the following conditions:
Can be a director, employee, or member of the company who normally resides in Hong Kong
A registered professional in Hong Kong, such as a certified accountant or lawyer
A licensed trust or company service provider (under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, Cap. 615)
The Companies Ordinance (Cap.622) ("CO") has been amended to require a company incorporated in Hong Kong to identify persons who have significant control over the company ("significant controllers") and to maintain a significant controllers register ("SCR") to be accessible by law enforcement officers upon demand. A new Division 2A has been added to Part 12 of the CO and will come into effect on 1 March 2018.
The SCR can be kept at the company's registered office or another location in Hong Kong designated by the company. If the SCR is not kept at the company's registered office, the company must notify the Companies Registry of the actual location of the SCR.
The company needs to designate at least one representative to be responsible for the SCR maintenance, who can be a director or employee of the company, or a third party providing professional services, such as a lawyer or accountant. The SCR custodian is responsible for ensuring the security of the SCR and regularly updating the register to ensure the accuracy of the information.
To identify persons who have significant control over the company ("significant controllers"); and
To maintain a significant controllers register ("SCR") to be accessible by law enforcement officers.
The requirement to keep a SCR applies to all companies formed and registered under the Companies Ordinance (Cap. 622) ("CO") or a former Companies Ordinance, except listed companies.
Entering particulars in the register
Updating information in the register
Allowing inspection by law enforcement officer
Identifying significant controllers
Giving notices to significant controllers & others
Penalties for Non-Compliance
Failure to comply with the above obligations is a criminal offence. The company and every responsible person of the company are liable to a fine at level 4 (i.e. $25,000). Where applicable, there is a further daily fine of $700.
Acting as company's designated representative
Maintaining the significant controllers register
Handling communications with law enforcement officers
Updating register information when notified of changes
Providing professional guidance on compliance requirements
Assisting with notice issuance to significant controllers
Safekeeping of the significant controllers register
Regular compliance reviews
Annual renewal of designated representative appointment
Advisory services on significant control determination
Assistance with filing necessary forms
Liaison with the Companies Registry
Yes, a significant controller can be appointed as the designated representative of a company if they qualify as either: a director, employee or member of the company who is a natural person resident in Hong Kong; or an accounting professional, a legal professional or a TCSP licensee.
If you are an employee of the holding company, you can be appointed as the designated representative of the holding company. For other companies in the group, you must be either a director, employee or member of each company, or an accounting professional, legal professional or TCSP licensee to be appointed as their designated representative.
The significant controllers register can be kept at the registered office of the company or any other place in Hong Kong. Unless the register is kept at the registered office, a company must notify the Registrar of the place where the register is kept within 15 days after it is first kept at that place or after any change in location.
Check the latest government and regulatory guidance relevant to this service before making filing, compliance, or planning decisions.
Access official guidance on the Significant Controllers Register and designated representative requirements.
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Review the statutory duties and eligibility criteria for a company's designated representative.
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Contact us today to discuss how we can help your company meet its legal requirements with our designated representative services.
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