Overview

The Articles of Association serve as a fundamental document in corporate governance for Hong Kong companies. They outline the internal structure and operational guidelines, covering key aspects such as shareholder rights, directors’ powers, and meeting procedures.

Key Requirements for Articles of Association

The following are essential components that should be included:

Shareholder Rights

• Define voting rights and procedures.

• Detail dividend entitlements.

• Establish mechanisms for transferring shares.

Directors’ Powers

• Specify the authority and limitations of directors.

• Outline decision-making powers.

• Include provisions for appointing executives and borrowing funds.

Board Meetings and Procedures

• Set rules for convening board meetings.

• Define decision-making processes and quorum requirements.

• Establish the frequency of meetings.

Shareholders’ Meetings

• Outline procedures for Annual General Meetings (AGMs) and Extraordinary General Meetings (EGMs).

• Define shareholder voting rights and decision-making processes.

Alteration of Articles

• Include provisions for amendments to the Articles of Association.

• Specify that changes may require a special resolution passed by shareholders.

Standard vs. Custom Articles

Hong Kong companies may adopt the Model Articles provided by the Companies Registry or create customized Articles suited to their specific needs.

Conclusion

The Articles of Association are crucial in defining the governance structure and internal operations of a company in Hong Kong. A well-drafted document ensures clarity, compliance, and the prevention of potential disputes among shareholders and directors.

For expert guidance on drafting or reviewing your Articles of Association, consult our specialists in company law to ensure full compliance with regulations and alignment with your business requirements.