CO129-557-9 British protection of companies in China 26-3-1936 - 27-2-1937 — Page 88

Memorandum.

1.

He

Sir John Brenan's proposals relate to two Articles

Nos.194 and 200 of the China Order in Council, 1925.

suggests the repeal of Article 194, which is at present

limited to "China Companies" and its replacement by an

Article 194, on the lines of Article 200 which relates to

China Companies limited by guarantee, applicable to all "British Companies" operating in China wherever such com-

panies may be incorporated.

2. The Hong Kong Companies Ordinance, in so far as it affects companies carrying on business within the limits ur

the China Orders in Council, has to be read subject to the provisions of the said Orders (see Ordinance No.39 of 1932,

s.2(2)).

3. Companies incorporated under the Hong Kong Companies

Ordinances which carry on business within the limits of the

China Orders in Council are of two kinds, "Hong Kong China

Companies", that is to say companies which are directed

and controlled from Hong Kong, but which carry on some

part of their business within the limits of the China

Orders in Council, and "China Companies", which are con-

trolled from some place within the limits of the Orders in

Council. Such companies are defined in Article 3 of the

China Order in Council, 1925, (Statutory Rules and Orders, 1925, No.603) and in section 348(1) of the Companies Ordi- nance, No.39 of 1932, of Hong Kong ""British Company" is defined by Article 3 of the China Order in Council, 1925, as a Company incorporated in the United Kingdom, or in a

British possession, and includes a China Company and a

Hong Kong China Company.

4. Sir John Brenan finds that the control given over British Companies by Article 194 of the Order in Council

of 1925 is insufficient, especially as certain companies

with no British interest have incorporated themselves in

London or Singapore and can therefore operate in China

without being "China Companies" under the Order in Council.

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