A Hong Kong company director is a statutory position under the Companies Ordinance (Cap. 622). Directors are senior decision-makers responsible for the company’s management and operations. In addition, directors may act on behalf of the company, such as signing contracts as a limited company, applying for licences, or signing documents and forms.
Further reading: Requirements for setting up a company | Hong Kong company registration process
Eligibility requirements for Hong Kong company directors
There are no nationality restrictions for company directors, but they must be at least 18 years old.
Under section 457(2) of the Companies Ordinance (Cap. 622), every private Hong Kong limited company must appoint at least one natural person as a director. Public companies and companies limited by guarantee must appoint at least 2 natural persons as directors, and may not appoint a company or corporate body as a director1.
No bankruptcy order
Hong Kong company directors must have a good background. Under the Bankruptcy Ordinance (Cap. 6), an undischarged bankrupt is not permitted to act as a director of a Hong Kong company unless the court grants permission. A bankrupt person is also not allowed to participate in the company’s management decisions2.
Relevant business experience
When banks conduct KYC, a director’s past work experience is an important consideration. Having relevant business experience can positively support the company’s application to open a business bank account.
Further reading: [Opening a Company Bank Account] Hong Kong bank account opening process, required documents, requirements and fees
Good background
Professional institutions such as company secretarial firms, accountants, and banks will conduct due diligence on directors. Therefore, directors must have a good background and no criminal record; otherwise, professional institutions may refuse to provide services to the company.
Company directors’ responsibilities
According to the Companies Registry’s Guide on Directors’ Duties3, the key principles of directors’ responsibilities include the following 11 points:
1. Directors must act in the best interests of the company.
2. Directors must exercise their powers for proper purposes and in the company’s interests, not for other reasons or benefits.
3. In general, directors must exercise independent judgment when using their powers.
4. Directors must manage the company and perform their duties responsibly, with skill and reasonable care.
5. Directors must avoid conflicts of interest with the company.
6. In general, directors must not enter into transactions with the company; where necessary, full disclosure must be made in advance.
7. Directors must not use their position to obtain benefits for themselves or others, or to prejudice the company’s interests.
8. Directors must not use the company’s property, information, or any business opportunity without the company’s consent.
9. Directors must not accept any benefit in return for exercising their powers, given that they must act in the company’s interests.
10. Directors have a duty to act in accordance with the Articles of Association and to convene board meetings.
11. Directors must take all reasonable steps to maintain and prepare the company’s accounting records.
Duties of directors of Hong Kong limited companies
Although in many Hong Kong SMEs the director and shareholder are often the same person, directors still have a duty to govern the operation of the limited company. Their duties include:
1. Acting on behalf of the company
2. Complying with the Articles of Association
3. Overseeing corporate governance
4. Supervising company operations
5. Convening directors’ and shareholders’ meetings
6. Voting rights on major decisions
7. Setting the company’s development direction
8. Signing important company documents on behalf of the company
Director change procedures
Required documents and key considerations for changing directors of a limited company
Whether appointing a director or a director resigning/stepping down, the process must be carried out in accordance with the Articles of Association4. Ensure that the incoming director meets the eligibility requirements and understands the responsibilities and duties of a limited company director. The following are required for a director change:
1. Articles of Association
2. Annual Return or company incorporation documents (for newly incorporated companies)
3. Business Registration Certificate
4. Certificate of Incorporation
5. Company statutory records book
6. Hong Kong identity document and address proof of the incoming director
7. Due diligence on the incoming director
Further reading: Online application for a Business Registration Certificate | Annual Return (NAR1)
Process for appointing an additional director to a limited company
1. Review the Articles of Association for the steps to appoint an additional director
2. Conduct due diligence on the newly appointed director
3. Convene a board meeting
4. Directors sign the meeting minutes
5. The incoming director signs Form ND2A “Notice of Change of Company Secretary and Director (Appointment/Cessation)”
6. Submit Form ND2A to the Companies Registry within 15 days
7. Update the company’s register of directors
8. Notify the bank, government authorities, or business partners
More details: Fees for director change services
Director resignation/step-down process
1. Review the Articles of Association for the procedures and steps for a director to step down or resign
2. The departing director submits a resignation notice to the company
3. Convene a board meeting
4. Directors sign the meeting minutes
5. The resigning director signs Form ND4 “Notice of Resignation of Company Secretary and Director” and Form ND4 “Notice of Change of Company Secretary and Director (Appointment/Cessation)”
6. Submit ND2A and ND4 to the Companies Registry within 15 days
7. Update the company’s register of directors
8. Notify the bank, government authorities, or business partners
Further reading: Company secretary licence, qualifications, legal responsibilities and duties
What is a first director?
A first director is the initial director appointed when a Hong Kong limited company is incorporated. When filing the incorporation form NNC1, you must provide at least one natural person as the company’s first director.
The first director may sign the “Consent to Act as Director” in Form NNC1, or submit Form NNC3 “Consent to Act as First Director” to the Companies Registry within 15 days after incorporation.
Further reading: Company incorporation documents: NNC1 incorporation form guide
Frequently Asked Questions
Q: Must a director be a shareholder?
A: No. A shareholder does not have to be a director, and a director may also hold no shares in the company.
Q: Is a director an employee?
Yes. In addition to being a statutory position, a director is also an employee of the company and must receive remuneration. In the Employer’s Return, there is a section for directors’ fees, used to report directors’ remuneration.
Q: How many years is the term of a Hong Kong company director?
Generally, there is no fixed term, but it depends on the company’s Articles of Association. The Articles and Association will set out the director’s duties, term, and rotation details.
Q: Can the director and shareholder of a Hong Kong limited company be the same person?
A: Yes. However, if the company has only one member and the director and shareholder are the same person, a third party must be appointed as the company secretary.
Q: Does an unlimited company need to appoint directors?
A: No. An unlimited company does not have the position of director—only a sole proprietor or partners. For details, please see: What is the difference between a limited company and an unlimited company?
Conclusion
In Hong Kong, every limited company must have at least one natural person director aged 18 or above. Directors are responsible for management and operations, play a core role in corporate decision-making, and must set business strategy, oversee day-to-day operations, approve major decisions, and ensure the accuracy of financial reporting.
General Accounting has been established for over 20 years and provides one-stop limited company incorporation and director change procedures. Trust or Company Service Provider (TCSP) licence no.: TC002940. If you have any questions about changing directors or shareholders, our professional customer service managers can provide free initial consultation and assistance with enquiries on appointing/removing/changing directors.
Further reading:
Sources
1. Company Registry – Directors
https://www.cr.gov.hk/tc/faq/local-company/directors-secretary.htm
2. Official Receiver’s Office
https://www.oro.gov.hk/cht/our_services/publications/bankruptcy/simple_guide_on_bankruptcy.html
3. Companies Registry – Guide on Directors’ Duties
https://www.cr.gov.hk/tc/companies_ordinance/docs/Guide_DirDuties-c.pdf
4. Companies Registry – Appointment, Removal and Resignation of Directors
https://www.cr.gov.hk/sc/companies_ordinance/docs/part10-c.pdf
