ENG-1977 — Page 55

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INDUSTRY AND TRADE

now replaced by the Companies Acts of 1948 and 1967. However, as a result of im- plementing a number of recommendations made by the Companies Law Revision Committee (June, 1971, and April, 1973), several parts of the ordinance - notably those dealing with prospectuses, accounts and audit - have been amended. These parts now incorporate most of the relevant provisions of the Companies Acts of 1948 and 1967. Considerable progress has been made in drafting a number of bills implementing other recommendations of the committee.

On incorporation, a company pays a registration fee of $300, plus $4 for every $1,000 of nominal capital. In 1977, 6,788 new companies were incorporated - 1,314 more than in 1976. The nominal capital of new companies registered totalled $2,552 million. Of the new companies, 98 had a nominal share capital of $5 million or more. During the year, 1,808 companies increased their nominal capital by amounts totalling $5,310 million, on which fees were paid at the same rate of $4 per $1,000. At the end of 1977, there were 49,896 local companies on the register, compared with 43,877 the previous year.

During the year, two ordinances dealing with company law were enacted. The Companies (Amendment) Ordinance 1977 is referred to later in this chapter under the heading, 'Bankruptcies and Liquidations'. The Companies (Amendment) (No. 2) Ordinance 1977 introduced a system for reserving, for a period of three months, the names of proposed new companies and name changes of existing companies. This replaced the previous non-statutory reservation system. A fee of $20 is payable for each inquiry about a proposed name. The legislation was brought into force in December, 1977.

Companies incorporated overseas are required to register certain documents with the Companies Registry within one month of establishing a place of business in Hong Kong. Only small filing fees are payable in such cases. During the year, 120 such companies were registered and 51 ceased to operate. At the end of 1977, 1,009 com- panies were registered from 48 countries, including 257 from the United States, 128 from Britain and 116 from Japan.

All insurance companies wishing to transact life, fire or marine insurance business in Hong Kong must comply with the provisions of either the Life Insurance Companies Ordinance or the Fire and Marine Insurance Companies Deposit Ordinance. In addi- tion to the filing of annual accounts, these ordinances require deposits to be made with the Registrar of Companies, unless the company is exempt. This exemption depends on the obtaining of a certificate from the insurance division of the Department of Trade in London, stating that the company is authorised under the Insurance Companies Act 1974 to carry on insurance business in Britain or - in the case of fire and marine insurance - maintaining similar deposits elsewhere in the Commonwealth. There are 316 insurance companies, including 147 local companies, transacting such business in Hong Kong. The approval of the Registrar General must be obtained for transacting motor vehicle third party insurance business.

The Companies Registry also deals with the incorporation of trustees under the Registered Trustee Incorporation Ordinance, and with the registration of limited partnerships and money-lenders.

During the year, the fees payable in connection with these functions were increased by the Registered Trustees Incorporation Ordinance (Amendment of Second Schedule)