To provide for a statutory regime on disclosure of beneficial ownership, FSTB propose requiring all unlisted companies incorporated under the Companies Ordinance in Hong Kong to keep a register of people with significant control (“PSC register”) over the company.
The aim of the PSC register is to enhance Hong Kong company ownership’s transparency in light of Hong Kong’s membership in the Financial Action Task Force (“FATF”). Currently, the company's registry only contains information of the immediate shareholders. The introduction of PSC register seeks to expand the scope of registrable persons and requires all unlisted Hong Kong incorporated companies to register “beneficial owners” of the company. The definition of a “beneficial owner” is similar to the one in the Securities and Futures Commission’s (“SFC”) Anti-Money Laundering (“AML”) guidelines, i.e. any individual holding more than 25% of shares/voting rights directly or indirectly. It further includes persons who have the right to appoint or remove a majority of the directors; exercises significant influence or control; or exercises significant influence or control over the activities of a trust or a firm that is not a legal person, but whose trustees or members are “beneficial owners”.
The PSC register will not be open for public inspection and can only be accessed exclusively by competent authorities. There is no timeline for implementation yet. The government is looking to introduce this amendment bill to the Legislative Council by July 2017. Access The consultation conclusion here.