LAW B333F
COMPANY LAW I
UNIT 2
RAISING SHARE CAPITAL
For lectures at HKMU campus
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LAW B333F Unit 2(2021 Autumn)
Copyright © The Open University of Hong Kong, 2020.
Reproduced September 2020
Contents
Introduction
A. Capital
1.Capital and share capital
2.The structure of share capital
3.Statement of capital and initial shareholding
B. Classes of shares
1.Class rights
2.Nature of different classes of shares
3.Variation of class rights
C. Membership in a company
1.Founder members
2.Share allotment
21
3.Transfer of shares
25
4.Transmission of shares
5.Registration
6.Mortgage of shares
D. Capital maintenance and variation
1.Doctrine of Capital maintenance
2.Uniform solvency test
3.Maintenance of Capital
E.
How do companies own shares in other companies?
F.
Reorganization within a group of companies
G.
Reconstructions, amalgamations and takeovers
References
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LAW B333F Unit 2(2021 Autumn)
Introduction
In Unit 1, we considered the characteristics of companies and the ways
in which companies are established by their promoters. Once a company has been formed, it needs
money to begin its business operations. In this unit, we will look at how companies obtain that
money from their members through issuing shares.
We will learn about the concept of share capital, the restrictions placed
on companies using their share capital, and the controlled circumstances in which companies can
reduce that share capital in this unit. We will also examine the rule prohibiting financial assistance
for acquisition of shares, and the exceptions.
Please note that the laws on many topics discussed in this study unit, e.g.
issued capital, nominal value of share, reduction of capital, buy-back, etc. were revised in March
2014 under the new Companies Ordinance.
Happy learning and studying in this unit!
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LAW B333F Unit 2(2021 Autumn)
(A)Capital(資本)
1. Capital and Share Capital
(a)
What is capital?
Whenever people start a business, they have to put assets into it, including money, tools, and
intangible assets such as know-how. They must also put a price tag on each of the assets, at
least for accounting purposes. These assets are known as ‘capital’.
There are, in general, two sources of money available for the promoters of a new company:

Investors, 投資者who are those willing to become shareholders by providing money to
the company over the long term and without a guaranteed rate of return on their
investment. In return, they expect to share in the company’s profits and exercise some
measure of control over the company’s affairs.

Lenders, 借款人who are those willing to lend money to the business for a specified
period and in return for a specified rate of interest on their loan.
A company’s capital can therefore be divided into two types:
(i) share capital (sometimes called ‘equity’), 股本and
(ii) loan capital (which will be considered in Unit 3). 借款
(b)
What is share capital (股本) ?
Share capital is the money that a company obtains by issuing its shares to shareholders. The
shareholder has no absolute right of repayment with respect to this capital, subject to the
following exception: when the company is dissolved and there are net assets available to be
distributed, then the shareholder will be entitled to a share of those nets assets in strict
accordance with the rights attaching to the shares and the priorities established by law. 股本是
指通過向股東發行股票獲得的資金。 股東對該資本沒有絕對的償還權利，但有以下例外
情況：當公司解散並有可供分配的淨資產時，股東將有權享有嚴格按照股份附帶的權利和
法律確定的優先的資產份額。
What are the legal characteristics of a share股票的法律特質? Here are some major features:

A share is a personal property transferable in accordance with the company’s articles of
association and any contractual agreement between shareholders 股票是根據公司章程細
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LAW B333F Unit 2(2021 Autumn)
則 和 股 東 之 間 的 任 何 合 約 可 轉 讓 的 非 土 地 財 產 (see ‘articles of association’ and
‘shareholder’s agreement’ in Unit 1).

Possession of a share certificate is proof of a member’s title to (or ownership of) the share.
擁 有 股 票 是 證 明 成 員 對 該 股 份 的 所 有 權 。

A shareholder may borrow on the security of his shares and give to the lender a mortgage
over the shares as security for repayment of the loan. 股東可以藉用其股份的擔保，並
向貸方提供抵押擔保，以償還貸款。
2. The structure of share capital (股本的結構)
(a) History
In the former Companies Ordinance, shares had a nominal value, also known as a par value.
Shareholders subscribing shares had to pay or were responsible for paying the par value. Any
payment in excess of the par value would be share premium to be transferred to a share premium
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LAW B333F Unit 2(2021 Autumn)
account to be used for limited purposes only. 在舊公司條例中，股票有面值。 認購股份的股
東必須支付或負責支付面值。 任何超過面值的付款將是股份溢價而轉到股份溢價賬目，其
僅用於有限的目的。 For instance, where a company had an authorized (or nominal) capital of
$100,000 divided into 100,000 shares of $1 each, the par value of each share was $1. The
constitution of the company would state the share capital this way: ‘The share capital was
$100,000 divided into 100,000 shares of $1 each.’ However, the company could issue shares at a
premium price (e.g. at $10) which exceeded the par value of the shares. The ‘share premium’ ($9)
would be the difference between the issue price ($10) and the par value ($1).
Under old Companies Ordinance:
Par value面值: $1 each
Issued price發行價: $10 each
Share premium股份溢價: $9 each
Under new Companies Ordinance:
Issued price only只有發行價
(b) The new law with effect from 3 March 2014
 No Par (Nominal)Value (沒有面值)and authorized capital沒有授權股本
 ONLY ISSUED SHARE CAPITAL只有發行股本
 Section 135 of the new Companies Ordinance abolishes nominal (par) value for shares and a
share has no par value. A company has no authorized capital. The share capital will be the
issued share capital of the company (the amount in the share premium account will become
part of the issued share capital --section 37 of Schedule 11 of the Companies Ordinance).
第622章 《公司條例》 第135條 股份沒有面值
135.股份沒有面值
(1)公司的股份沒有面值。
(2)本條適用於在本條的生效日期#前發行的股份，亦適用於在該日期當日或之後發行的股份。
附註——
附表11第4部第2分部載有關乎廢止面值的過渡性條文。
第622章 《公司條例》 附表11 過渡性條文及保留條文
37.對股份溢價帳及資本贖回儲備的處理
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LAW B333F Unit 2(2021 Autumn)
(1)在第135條的生效日期#開始時，公司的股份溢價帳的任何貸方結餘，以及其資本贖
回儲備的任何貸方結餘，均成為公司股本的一部分。
(2)在第135條的生效日期#當日或之後，會被續用條文規定須轉至公司的股份溢價帳或
資本贖回儲備的款額，均成為公司股本的一部分。
 Thus, a share represents a fraction of the equity (share capital) in the company. It has no fixed
face value. The share capital of a company is expressed as follows:
‘$x divided into y shares.’
'$ x分為y股。’
 The share capital is ‘issued’ (or sold) to raise money for the company’s operations. A share
may be issued at any price, subject to the free commercial negotiation between the company
and the investor who subscribes for the share and becomes a shareholder. There is no
‘minimum price’, although directors are subject to an overriding fiduciary duty to set the
price in good faith. 股本“發行”（或出售）是為公司經營籌集資金。 股份可以以任何
價格發行，但須經公司與認購股份的投資者之間的自由商業談判，而投資者後來成為公
司股東。 雖然股份沒有“最低價格”，董事會承擔絕對的受信責任來制定股份價格。
 The concepts of paid up capital, issued capital and partly paid shares are still relevant (仍應用).
Under the present Companies Ordinance, they are related to the total consideration(價值) paid
or agreed to be paid for the shares issued, but not tied to a par value. 根據現行公司條例，它
們與所發行股份支付或同意支付的總代價（價值）有關，但與股票面值並無關係。
According to section 170 (2) of the Companies Ordinance, a company may:
(a)increase its share capital by allotting and issuing new shares in accordance with this Part;
(b)increase its share capital without allotting and issuing new shares, if the funds or other
assets for the increase are provided by the members of the company;
(c)capitalize its profits, with or without allotting and issuing new shares;
(d)allot and issue bonus shares with or without increasing its share capital;
(e)convert all or any of its shares into a larger or smaller number of shares;
(f)cancel shares—
(i)that, at the date the resolution for cancellation is passed, have not been taken or agreed to
be taken by any person; or
(ii)that have been forfeited.
第622章 《公司條例》 第170條 獲准許的股本更改
170.獲准許的股本更改
(1)有限公司可藉第(2)款列明的任何一種或多於一種方式，更改其股本。
(2)公司可 ——
(a)藉按照本部配發及發行新股份，以增加其股本；
(b)在沒有配發及發行新股份的情況下，增加其股本，但前提是增加股本所需的資金或
其他資產，是由該公司的成員提供的；
(c)在有或沒有配發及發行新股份的情況下，將其利潤資本化；
(d)在有或沒有增加其股本的情況下，配發及發行紅股；
(e)將其全部或任何股份，轉換為更大或更小數目的股份；
(f)取消以下股份 ——
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LAW B333F Unit 2(2021 Autumn)
(i)截至關乎取消股份的決議通過當日，尚未獲任何人承購或同意承購的股份；或
(ii)被沒收的股份。
(3)有限公司只可藉其決議進行第(2)(e)或(f)款提述的股本更改。 附註——
第140及141條所載條文要求作出批准股份配發的公司決議。該等條文可能與第(2)(a)、
(c)或(d)款提述的股本更改有關。
(4)第(3)款提述的決議可授權公司 ——
(a)行使有關權力多於一次；
(b)在指明時間或在指明情況下行使有關權力。
(5)就根據第(2)(e)款轉換的股份而屬尚未繳付的股款，須在替代股份之間平均分配。
(6)如有股份根據第(2)(f)款被取消，公司須按被取消股份的款額，減少其股本。
(7)就第5部而言，根據本條取消股份並非減少股本。
(8)有限公司的章程細則可禁止或限制行使本條賦予的權力。
Please note: s170(2)(b) and (c) are actually increasing the value of existing shares
(3) Statement of capital and initial shareholding – for a company
intended to be formed as a company limited by shares
Under the old law:
The memorandum of association of a
company with a ‘capital clause’ stated
the amount of the share capital and the
number of shares into which it was
divided.
Under the existing law:
The articles of association of a company
with a share capital must include a
‘Statement of Capital and Initial
Shareholdings’,
setting
out
the
following information:

 e.g. ‘The share capital of the company
is $100,000 divided into 100,000
shares of $1 each.’

the total number of shares that the
company proposes to issue on the
company’s formation;
the total amount of share capital to
be subscribed by the company’s
founder members;

the amount to be paid up (已付的股
本), and

the amount to remain unpaid on the
total number of shares that the
company proposes to issue on that
formation, (成立時預算發行股份
數目及暫未付款的股份)
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LAW B333F Unit 2(2021 Autumn)

and similar information on each
class of shares, if any (若有不同種
類股份，每種都要提供以上資料)
The company’s articles may state the maximum number of shares that it may issue (section 85(2)),
but stating such a maximum is not a requirement.
第622章 《公司條例》 第85條 股本及最初的股份持有情況
85.股本及最初的股份持有情況
(1)有股本的公司的章程細則須述明附表2第8條(第(1)(d)(iv)、(v)、(vi)及(vii)款除外)規定須載於該公司
的法團成立表格內的資料。
(2)有股本的公司的章程細則可述明，該公司可發行的股份數目的上限。
第622章 《公司條例》 附表2 法團成立表格的內容
8.股本及最初的股份持有情況的陳述
(1)為施行第68(2)條而指明的陳述，是符合以下說明的陳述 ——
(a)述明有關公司建議在其組成時發行的股份總數；
(b)述明該公司的創辦成員將會在該公司組成時認購的股本總額；
(c)述明將按或視為已按該公司建議在其組成時發行的股份的總數繳付的款
額，及尚未或視為尚未按該等股份的總數繳付的款額；
(d)如該等股本將會在該公司組成時，分為不同類別的股份，則亦述明該等類
別，並就每個類別的股份而言，述明 ——
(i)該公司建議在其組成時發行的該類別的股份總數；
(ii)該公司的創辦成員將會在該公司組成時認購的該類別的股本總額；
(iii)將按或視為已按該公司建議在其組成時發行的該類別的股份的總數繳付
的款額，及尚未或視為尚未按該等股份的總數繳付的款額；
(iv)該類別股份所附帶的表決權的詳情，包括只在某些情況下產生的權利；
(v)該類別股份所附帶的、在分派股息時參與分派的權利的詳情；
(vi)該類別股份所附帶的、在分派股本時(包括清盤時進行的分派)參與分派的
權利的詳情；及
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LAW B333F Unit 2(2021 Autumn)
(vii)該類別股份是否屬可贖回股份；及
(e)就每名創辦成員，述明該公司建議在其組成時向該成員發行的股份數目，
及該成員將會在該公司組成時認購的股本總額。
(2)如建議在有關公司組成時向某創辦成員發行的股份，屬於2個或多於2個類
別，則第(1)(e)款規定的資料須就每個類別的股份而述明。
CAP 622H COMPANIES (MODEL ARTICLES) NOTICE Schedule 2 Model Articles for Private Companies
Limited by Shares
http://www.hklii.hk/eng/hk/legis/reg/622H/sch2.html
第622H章 《公司(章程細則範本)公告》 附表2 私人股份有限公司的章程細則範本
http://www.hklii.hk/chi/hk/legis/reg/622H/sch2.html
(4) Continuous Updating by filing to Companies Registry
whenever required
Whenever there is a change to its capital, e.g. by an allotment of shares (section 142) or
alteration of share capital (section 171), the company must file notice of alteration in all cases
which incorporates a statement of capital. The statement of capital required under section 201
sets out the details of the (i) total number of issued shares, (ii) total paid up capital and (iii) total
issued capital. This is an improvement on the past system whereby it was necessary to search
for various documents on the register to ascertain such information. Hence, the public can find
out a company’s total subscribed capital by looking at the latest statement of capital. 這是對過
去的系統的改進，過去必須在登記冊上搜索各種文件來確定這些信息。 因此，現在公眾
可以透過查看最新的股本說明，找出公司的總共已認購股本。
第622章 《公司條例》 第142條 配發申報書
第622章 《公司條例》 第171條 更改股本的通知
第622章 《公司條例》 第201條 股本說明
201.股本說明
(1)如本部或第5 部的條文規定交付處長登記的申報書、申報表或通知須載有股本說明，
則本條適用。
(2)股本說明須述明 ——
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LAW B333F Unit 2(2021 Autumn)
(a)公司的已發行股份的總數；
(b)按或視作已按公司的已發行股份的總數而繳付的款額，以及(如有的話)尚未按或視作
尚未按該等股份的總數繳付的款額；
(c)公司的已發行股本的總款額；及
(d)就每一類別股份而言 ——
(i)第(3)款指明的詳情；
(ii)該類別股份中的已發行股份的總數；
(iii)按或視作已按該類別股份中的已發行股份的總數而繳付的款額，以及( 如有的話) 尚
未按或視作尚未按該等股份的總數繳付的款額；及
(iv)該類別股份中的已發行股本的總款額。
(3)上述詳情為 ——
(a)有關類別股份所附帶的表決權的詳情，包括只在某些情況下產生的權利；
(b)該類別股份所附帶的、在分派股息時參與該項分派的權利的詳情；
(c)該類別股份所附帶的、在分派股本時(包括在進行清盤時)參與該項分派的權利的詳情；
及
(d)該類別股份是否屬可贖回股份。
(B) Classes of shares
1. Class Rights (權利)
(a) Shares of different class rights
Generally, classes of shares are determined by reference to the different rights conferred on the
shares, commonly known as ‘class rights’. The rights conferred on a shareholder by the
ownership of a share can be divided into three categories: (通常股東因擁有股份而享有的權利
有以下三種):

Dividend rights股息權: The right to participate in the profits of the company.

Voting rights表決權: The right to attend meetings of the company and to vote.
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LAW B333F Unit 2(2021 Autumn)

Capital redemption rights資本退還: The right to have capital returned in whole or in part on
the winding-up of the company.
(b) What are class rights?
Section 177 of the new Companies Ordinance clarifies that class rights are the rights conferred
on the holder of a share as a member of the company. Section 178 provides further that:
 shares are in one class if the rights attached to them are in all respects uniform
(s178(1)Cap622), and
 the rights attached to shares are not to be regarded as different from those attached to other
shares only because they do not carry the same rights to dividends in the 12 months
immediately following their allotment. (s178(2 )Cap622).
第622章 《公司條例》 第177條 股份所附帶的權利
177.股份所附帶的權利
在本條例中，提述屬公司某股份類別的股份所附帶的權利，即提述該股份的持有人作為該
公司成員的權利。
第622章 《公司條例》 第178條 股份的類別
178.股份的類別
(1)就本條例而言，如某些股份所附帶的權利，在所有方面均屬劃一，該等股份即屬同一類
別。
(2)如被配發的股份在緊接配發後的12個月內，並不帶有相同的收取股息的權利，有關股份
所附帶的權利不會僅因該事宜，而被視為有異於其他股份所附帶的權利。
(c) How to have different class rights
(i)
Presumption in law
All members of a company are presumed to have equal dividend, voting and capital
redemption rights unless the company’s articles state that they are not equal. There is a
similar presumption of equality as to shareholders’ liabilities (若公司章程細則沒有說明，
法律上推定所有成員的權利與責任都一樣).
(ii)
Rebutting the presumption by provisions in the articles
(若章程細則有提及，便可以有不同權利與責任的股份)
The presumption of equality of shares can be modified (上面(i) 所述推定可以被推翻或
改變). Special provisions in a company’s articles can divide its shares into different
classes with different rights as to dividends, voting and capital redemption (若公司章程
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LAW B333F Unit 2(2021 Autumn)
細 則 有 提 及 ， 它 的 股 份 可 分 不 同 類 別 ) . By changing matters singularly or in
combination, it is possible to create many classes of shares. 通過單獨或組合地改變公
司章程細則，可以創造許多類別的股份。
THIS IS AN EXAMPLE ONLY 舉例
Article 57 of Model Articles for Private Companies Limited by Shares (Schedule 2 to the
Companies (Model Articles) Notice, Cap 622H) (the ‘Model Articles’), provides that:
“57. Powers to issue different classes of shares
(1) Without affecting any special rights previously conferred on the holders of any
existing shares or class of shares, the company may issue shares with—
(a) preferred, deferred or other special rights; or
(b) any restrictions, whether in regard to dividend, voting, return of capital or otherwise,
that the company may from time to time by ordinary resolution determine.
(2) Subject to Division 4 of Part 5 of the Ordinance, the company may issue shares on the
terms that they are to be redeemed, or liable to be redeemed, at the option of the
company or the holders of the shares.
(3) The directors may determine the terms, conditions and manner of redemption of the
shares.”
第622H章 《公司(章程細則範本)公告》 附表2 私人股份有限公司的章程細則範本
57.發行不同類別股份的權力
(1)本公司發行的股份可附有 ——
(a)優先、遞延或其他特別的權利；或
(b)在股息、表決、資本退還或其他方面的限制，該限制可由本公司不時藉普通決議
決定，而之前授予任何原有的股份或原有類別的股份的持有人的任何特別權利，
不受影響。
(2)在符合《條例》第5部第4分部的規定下，本公司可按以下條款發行股份︰該股份
須按或可按本公司或股份持有人的選擇而被贖回。
(3)董事可決定贖回股份的條款、條件及方式。
2. Nature of different classes of shares
If classes of shares are issued, those classes are specified in articles of association (e.g. Art. 57
above), which divides the capital into those various classes. In general, there are three board
classes of shares:
 ordinary shares普通股
 preference shares優先股
 redeemable shares可贖回股份
The rights attached to various classes of shares are contractual and are set out under the
company’s articles. The rights are not derived from the Companies Ordinance. 各類股份的權
利是由合約(即公司的章程細則)訂定的，並列在公司的章程細則內。 這些權利不是衍生
自公司條例。
(a) Ordinary shares(普通股)
(i) Many companies are incorporated with just one class of shares. The Model Articles are
drafted on the assumption that there is only one class of members and all shares in the
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LAW B333F Unit 2(2021 Autumn)
company have the same nominal value [in a general sense]. 許多公司只註冊一類股份。
章程細則範本是以只有一類成員為基礎，公司所有股份具有相同的面值的假設來起草
的。
(ii) If only one class is issued, the members are all called ‘ordinary shareholders’ and their shares
are called ‘ordinary shares’. 如果只發行一個類別，則所有成員均為“普通股股東”，其股份
稱為“普通股”。
(iii)Ordinary shareholders are:
 entitled to be paid a dividend on their shares only after all preference dividends have
been paid, and (較優先股股東遲獲股息)

if the preference shares have priority for repayment of capital in a winding-up, the
ordinary shareholders are entitled to be repaid only after the preference capital has
been repaid in full (在清盤時，較優先股股東遲獲發還股本).

Ordinary shareholders expect to receive a larger dividend than preference
shareholders if the company prospers (若公司利潤豐厚，普通股股東比優先股股東
分股息更多) since the preference shares have fixed rate interests (see (b)(ii) below
for reasons). Their loss will be greater if the company fails, but if it prospers they can
expect a dividend which reflects that success. 因為優先股有固定股息利率（見下
文（b）
（ii））
。 如果公司失敗，普通股股東的損失將會更大，但是如果公司興旺，
那麼他們可以預期會產生反映這一成功的股息(即股息會相應增加)。
Most of the voting power at the general meeting shall belong to the ordinary
shareholders. 股東大會投票權大部分屬於普通股股東。

(b) Preference shares (優先股)
(i) These shares provide some preference over other shares in respect of the payment of dividends or
the repayment of capital. 較普通股股東較早獲派股息，在清盤時，較普通股股東較早獲發還
股本。
(ii) This preference is a right to receive a fixed rate of dividend (e.g. 5% per annum) before the
declaration of a dividend payable to other shareholders. (就算其他類別股東不獲派息，他
們都獲定率與定期派息). In the absence of specific restrictions, it is presumed that
preference shares are ‘cumulative’. This means that any unpaid dividend arrears accumulate
and must be paid in a later year before the payment of any dividend to ordinary shareholders.
(除另有規定外，假定若公司無盈利，不能派息與優先股股東，該年的定率股息便當為
公司對優先股股東的欠債).
For example:
Y1: Preference share dividend $100 (but not declared)
Y2: Preference share dividend $100 (but not declared)
Y3: Preference share dividend $100 (declared) + $200 (from Y1 and Y2)
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LAW B333F Unit 2(2021 Autumn)
(iii) The company’s articles are exhaustive ( 詳 盡 無 遺 )on the rights of the preference
shareholders. If shares are given a preferential dividend, they are presumed 假定to be
non-participating as regards further dividends不能獲派進一步/多些股息, and if they are
given a preferential right to a return of capital, they are presumed 假 定 to be
non-participating in surplus assets. 不能獲派剩餘資產
Supporting case: Scottish Insurance Corp Ltd v. Wilson and Clyde Coal Co Ltd [1949] AC
462(優先股股東的權利完全列明在章程細則，沒有其他更多權利)
Case facts: a company’s business had been nationalized收歸國有. As the company would
cease business, it intended to go into voluntary liquidation自願(動)清盤. Meanwhile, the
company decided to reduce its share capital by paying off the 7% preference shareholders公司
決定贖回優先股. The company’s articles provided that ‘in the event of a winding-up, the
preference shareholders shall rank before the other shares on the property of the company, to
the extent of repayment of the amounts called up and paid thereon’.
The preference shareholders complained that the reduction would deprive them of the right to
share in the surplus assets of the company on liquidation. 優先股股東反對贖回，因贖回令
他們喪失獲分剩餘資產的權利。
The House of Lords held that the company’s articles were exhaustive (詳細-鉅細無遺) on
the rights of the preference shareholders in a winding-up. The articles provided for repayment
of capital only and the preference shareholders thus did not have the right to share in the
surplus assets. 章程細則只提供優先獲發還股本，優先股股東沒有權分享剩餘資產。
(c) Redeemable shares (可贖回股份)
(i) Special issue term for redemption: Redeemable shares are shares issued on the basis that
they can be bought back by the company at a specified time, or at the option of the
company or the shareholder. (發行股票時指明必會被公司或其他股東回購).
(ii) Authority for issue (發行此等股份權力)
Under section 234 of the Companies Ordinance, a company may issue redeemable shares
subject to the following(可發行,除非以下情況):

A company’s articles may prohibit or restrict the issue of redeemable shares (若章
程細則明文禁止).
(Note: since Art. 57 permits the issue, so a company using Model Articles can issue
redeemable shares, 因 Art. 57 容許，所以用 Model articles 便可發行).

A company must not issue redeemable shares at a time when there are no issued
shares in the company other than redeemable shares.
第 622 章 《公司條例》 第 234 條 發行可贖回股份
234.發行可贖回股份
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LAW B333F Unit 2(2021 Autumn)
(1)除第(2)及(3)款另有規定外，公司可發行可贖回股份。
(2)公司的章程細則可禁止或限制可贖回股份的發行。
(3)公司如無不屬可贖回股份的已發行股份，則不得發行可贖回股份。
第 622H 章 《公司(章程細則範本)公告》 附表 2 私人股份有限公司的章程細則範本
57.發行不同類別股份的權力
(1)本公司發行的股份可附有 ——
(a)優先、遞延或其他特別的權利；或
(b)在股息、表決、資本退還或其他方面的限制，該限制可由本公司不時藉普通決議決
定，而之前授予任何原有的股份或原有類別的股份的持有人的任何特別權利，不受
影響。
(2)在符合《條例》第 5 部第 4 分部的規定下，本公司可按以下條款發行股份︰該股份
須按或可按本公司或股份持有人的選擇而被贖回。
(3)董事可決定贖回股份的條款、條件及方式。
(iii) How to finance a buy- back of redeemable shares?
A company may make a payment in respect of a redemption or buy-back of its own shares:

out of the company’s distributable profits; 由公司可分配利潤中出資

out of the proceeds of a fresh issue of shares made for the purpose of the
redemption or buy-back; 由為贖回或回購目的的新股發行所得中出資or

out of capital in accordance with the relevant provisions of the Companies Ordinance.
根據公司條例的有關規定，由股本出資。
(iv) The rules applicable to buy-back of a company’s own shares will be explained further in
the sub-topic ‘Buy-back of a company’s own shares’ below. 在下列回購股份中詳述
3. Variation of class rights (更改類別股票的權利)
(a) What is variation of class rights?
Variation of class rights refers to any change or removal of any special rights attached to a
particular class of shareholders. Where some rights have already been attached to a class of
shares, they cannot be varied unless all the holders of the same class of shares agree. 類別權利
的更改是指對特定類別股東附加的任何特殊權利的任何更改或刪除。 如果一類股份已經
附有一些權利，除非同一類股的所有持有人同意，否則不得變更。
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LAW B333F Unit 2(2021 Autumn)
Variation of class rights usually happens when the company’s articles are amended, or when new
shares are issued. To constitute(構成) a variation of class rights, there must be some substantial
change in the rights of shareholders of one class, in comparison with the rights of shareholders of
another class. 類別權利的更改通常發生在公司章程細則修改或新股發行時。 構成類別權利
的更改，本類股東的權利與其他類別股東的權利相比，必然是發生重大變化。
(b) What does not constitute variation of class rights?
(i) If the rights of all classes of shareholders are adjusted equally, there will not be any ‘variation
of class rights’. 如果所有類別股東的權利得到平等調整，就不會構成更改類別權利。
Supporting case: Greenhalgh v. Arderne Cinemas Ltd. [1946] 1 All ER 512, (股份由每股10
shillings 更改為5股每股2shillings，不構成更改類別權利)
Case facts: the court held that no variation of rights had resulted when each of the company’s
shares were converted from 10-shilling shares into five 2-shilling shares. Although the value of
each individual share had been reduced, there had been no change in the status of shareholders
relative to each other. 雖然每個股份的價值都有所下降，但股東之間的狀況並沒有變化。
In particular, the rights of a class of shareholder are not varied when the company merely issues
more shares ranking equally (known as ‘pari passu’) (享有同等權益) with the shares of that class.
特別是，當公司只發行多些與該類別股份享有同等權益的股票時，該類別股東的權利沒有
更改。
(ii) Class rights are not deemed to be varied even though the net effect of issuing new shares is to
dilute the power of existing shareholders. 即使發行新股的淨效應是冲淡現有股東的權力，
類別權利也不會被視為更改。
Supporting case: White v. Bristol Aeroplane Co Ltd [1953] Ch 65(發行同等權利的優先股
不構成更改類別權利)
Case facts: the company proposed to increase the share capital by issuing 600,000 preference
shares of £1 each, ranking pari passu with the existing 600,000 preference shares, and 2,640,000
ordinary shares of 50p each, ranking pari passu(享有同等權益)with the existing ordinary
shares. The new shares were paid out of the company’s reserve fund (i.e. a bonus issue). It was
held that the increase in capital did not ‘affect’ the rights and privileges of existing preference
shareholders. Only enjoyment of the rights, but not the rights themselves, was affected.
公司擬通過發行600,000股每股1鎊的優先股，與現有60萬股優先股享有同等權益，及
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LAW B333F Unit 2(2021 Autumn)
2,640,000股每股50便士的普通股，與現有普通股享有同等權益。 新股由公司的備用金（即
紅利）支付。 法院認為資本增加並沒有影響現有優先股的權利和特權， 只是影響權利的
享受，而不是權利本身受到影響。
(c) How can class rights be varied?
The new Companies Ordinance has standardized the procedures for variation of class rights.
According to section 180 of the Companies Ordinance, rights attached to shares in a class of
shares in a company may be varied only:
(i) in accordance with provisions in the company’s articles for the variation of those rights; or
(ii) if there are no such provisions, with 75% consent or special resolution (特別決議)of the class
members.
But note: Section 182 of the Companies Ordinance allows holders representing at least 10%
of the total voting rights of holders of shares in the class to apply to the Court to have the
variation disallowed.
第622章 《公司條例》 第180條 更改類別的權利
180.更改類別的權利
(1)如某股份屬公司某類別的股份，該等股份所附帶的權利 ——
(a)只可按照其章程細則中關於更改該等權利的條文而更改；或
(b)在沒有該等條文的情況下，只可在該類別股份的持有人按照本條給予的同意下更改。
(2)第(1)款不損害對更改權利的任何其他限制。 例子——
公司能與某類別股份的持有人訂立協議，對更改類別的權利施加限制。
(3)為本條的目的而需有的同意為 ——
(a)持有人的書面同意，而該名或該等持有人持有的表決權佔有關類別股份的持有人的總表
決權中最少75%；或
(b)在一個分開舉行的該類別股份的持有人的成員大會上通過的認許有關更改的特別決
議。
(4)如 ——
(a)沒有人根據第182條提出否決更改的申請，該項更改在根據該條提出申請的限期終結時
生效；或
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LAW B333F Unit 2(2021 Autumn)
(b)有人在該限期內提出該申請，該項更改在該申請被撤回時生效，或在該申請獲終局裁定
時生效(如該項更改被否決則除外)。
(5)對公司的章程細則中關於更改某類別的股份所附帶的權利的條文的修訂，或將任何該等
條文加插於該章程細則內，本身須視為該等權利的更改。
(6)本條不影響原訟法庭根據第673、675及725條具有的權力。
第622章 《公司條例》 第182條 原訟法庭否決或確認更改事宜
182.原訟法庭否決或確認更改事宜
(1)如屬公司某類別股份的股份所附帶的權利被更改，所持有的表決權佔該類別股份的持有
人的總表決權中最少10%的持有人，可向原訟法庭提出申請，要求否決該項更改。
(2)上述申請須在有關更改作出的日期後的28日內提出。
(3)上述申請可由有權提出申請的全部有關成員以書面委任的他們當中的一人或多於一人
代表他們提出。
(4)在聆訊申請時，下述的人有權陳詞 ——
(a)有關申請人；
(b)原訟法庭覺得在該申請中有利害關係的任何其他人。
(5)原訟法庭如信納有關更改會不公平地損害申請人所代表的成員，可藉命令否決該項更
改。
(6)原訟法庭如並不信納有關更改會不公平地損害申請人所代表的成員，須藉命令確認該項
更改。
(7)本條不影響 ——
(a)任何成員根據第724條向原訟法庭提出呈請的權利；或
(b)原訟法庭根據第725條具有的權力。
(C) Membership in a company
Section 112 of the Companies Ordinance defines ‘members of a company’ as follows:
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LAW B333F Unit 2(2021 Autumn)

A founder member of a company is to be regarded as having agreed to become a member
of the company.

On the registration of a company, a founder member of the company must be entered, as a
member, in the company’s register of members.

Any other person who agrees to become a member of a company and whose name is
entered as a member, in the company’s register of members is a member of the company.
第622章 《公司條例》 第112條 公司成員
112.公司成員
(1)公司的創辦成員須視為已同意成為該公司的成員。
(2)在公司註冊時，該公司的創辦成員須作為成員，記入該公司的成員登記冊。
(3)如任何其他同意成為公司成員的人的姓名或名稱，已作為成員記入該公司的成員登記冊，
該人即為該公司的成員。
Becoming a member of a company is a two-stage process:
(i)
First stage:

The first stage can be accomplished either by way of
- being a founder member of a company; 創辦成員
- allotment; 配發
- purchase of shares from an existing member; or從成員中購買
- transmission. 傳轉 (例如承繼)
(ii) Second stage:

The second stage is registration. 登記/註冊
(1) Founder members
Section 112 of the Companies Ordinance defines the founder member as having agreed to be a
member of the company, and must be entered as a member, on registration of a company.
第622章 《公司條例》 第112條 公司成員
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LAW B333F Unit 2(2021 Autumn)
112.公司成員
(1)公司的創辦成員須視為已同意成為該公司的成員。
(2)在公司註冊時，該公司的創辦成員須作為成員，記入該公司的成員登記冊。
(3)如任何其他同意成為公司成員的人的姓名或名稱，已作為成員記入該公司的成員登記冊，
該人即為該公司的成員。
(2) Share allotment
(a)
What is share allotment(配股/配發)?
Sometimes a person does not acquire shares from an existing shareholder, but the company
issues the shares to him directly. The shares are said to be ‘allotted’ to him. Allotment refers to
the decision to allot shares to a particular person, and in return that person agrees to accept the
shares allotted to him and to be bound by the articles of association. 配發是指向特定人士分
配股份的決定，作為回報，該人同意接受分配給他的股份，並受公司章程細則約束。
Shares may be allotted for cash, or a consideration other than cash (e.g. assets, stock-in-trade,
etc.).
(b)
Restriction of directors’ power to allot shares
(i) Sections 140 and 141 of the Companies Ordinance direct that shareholders’ approval
is required:



for allotments of shares;
the grants of rights to subscribe for; or
to convert securities into shares.
If approval is given for the grant of an option, there will not be a
need to obtain further approval of the allotment of shares pursuant to that option.
第622章 《公司條例》 第141條 經公司批准的股份配發或權利授予
141.經公司批准的股份配發或權利授予
(1)如公司藉其決議事先給予批准，則該公司的董事可行使以下權力 ——
(a)配發公司股份的權力；或
(b)授予認購公司股份的權利的權力，或授予將任何證券轉換為公司股份的權利的權
力。
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LAW B333F Unit 2(2021 Autumn)
(2)公司可對上述權力的行使給予一次性的批准或給予一般性的批准，批准可不附帶
條件，亦可受條件規限。
(3)在第(4)及(5)款的規限下 ——
(a)如公司須舉行周年成員大會，在以下兩項情況中較早出現者出現時，上述批准即
告期滿失效 ——
(i)緊接給予該批准後舉行的周年成員大會結束；
(ii)於給予該批准後按規定須舉行下一次周年成員大會的限期屆滿；
(b)如公司因第612(1)條而無須舉行周年成員大會，上述批准在該條的規定獲符合的日
期期滿失效；或
(c)如公司因任何其他理由而無須舉行周年成員大會，上述批准在該批准所指明的日
期(該日期不得超逾給予批准後的12個月)期滿失效。
(4)公司可隨時藉其決議，撤銷或更改有關批准。
(5)如符合以下兩項條件，董事可在批准期滿失效後，配發股份或授予權利 ——
(a)該項配發或授予，是根據一項由有關公司在該項批准期滿失效前作出或批出的要
約、協議或選擇權而進行的；及
(b)該批准容許公司作出或批出將會或可能具有以下效力的要約、協議或選擇權：規
定在該批准期滿失效後配發股份或授予權利。
According to section 140 of the Companies Ordinance, directors shall not exercise any
power of the company to allot shares, or to grant rights to subscribe for, or to convert any
security into, shares in the company without the prior approval of the company in a general
meeting, but does not apply to an allotment in the following 4 situations: (沒有股東大會許
可，不能發行新股…，除非以下四種情況，便可例外):
(i)
an allotment of shares, or grant of rights, under an offer made to the members of the
company in proportion to their shareholdings (發行比例學現時持股比例一樣);
(ii) an allotment of shares, or grant of rights, on a bonus issue of shares to the members of
the company in proportion to their shareholdings;
(iii) allotment to a founder member of a company of shares that the member, by signing the
company’s articles, has agreed to take (發行予創會會員); or
(iv) an allotment of shares made in accordance with a grant of a right to subscribe for, or to
convert any security into, shares approved in advance by resolution of the company 事
先在會員大會通過).
第622章 《公司條例》 第140條 董事行使權力配發股份或授予權利
140.董事行使權力配發股份或授予權利
(1)除按照第141條的規定外，公司董事不得行使任何以下權力 ——
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LAW B333F Unit 2(2021 Autumn)
(a)配發公司股份的權力；或
(b)授予認購公司股份的權利的權力，或授予將任何證券轉換為公司股份的權利的權
力。
(2)第(1)款不適用於 ——
(a)在一項按公司成員持股比例而向他們作出的要約之下配發股份或授予權利；
(b)在按公司成員持股比例而向他們派發紅股時配發股份或授予權利；
(c)向公司的創辦成員配發該成員藉簽署該公司的章程細則而同意承購的股份；或
(d)按照一項授予認購股份的權利或一項授予將任何證券轉換為股份的權利進行的
股份配發，前提是該項權利是按照第141條所指的批准而授予的。
(3)為施行第(2)(a)款，如任何成員的地址所在地的法律不准許作出有關要約，則該要
約無需向該成員作出。
(4)任何董事明知而違反本條，或授權或准許違反本條，即屬犯罪。
(5)任何董事犯第(4)款所訂罪行，可處第5級罰款及監禁6個月。
(6)本條或第 141 條不影響配發或其他交易的有效性。
(ii) Scope of Approval
The approval may be confined to a particular allotment or general; and any such approval
may be unconditional or subject to conditions. 公司可對上述權力的行使給予一次性的
批准或給予一般性的批准，批准可不附帶條件，亦可受條件規限。Moreover, the
approval shall continue in force until:


the conclusion of the annual general meeting commencing next after the date on which
the approval was given; or
the expiry of the period when the next annual general meeting is required.
--Whichever is earlier.
如公司須舉行周年成員大會，在以下兩項情況中較早出現者出現時，上述批准即告
期滿失效 ——(i)緊接給予該批准後舉行的周年成員大會結束；(ii)於給予該批准後按
規定須舉行下一次周年成員大會的限期屆滿；
(iii) Document for filing
When a company allots shares, a return of allotment in the specified form (NSC1) must be
delivered with the Companies Registrar for registration within one month of the allotment
(section 142 (1)).
第622章 《公司條例》 第142條 配發申報書
142.配發申報書
(1)有限公司須在股份配發後的一個月內，將符合第(2)款的配發申報書交付處長登
記。
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LAW B333F Unit 2(2021 Autumn)
(2)申報書 ——
(a)須符合指明格式；
(b)須載有一項以配發的日期的狀況為準的股本說明，該項說明須符合第201條；
(c)須述明 ——
(i)所配發的股份的數目；
(ii)每名獲配發者的姓名或名稱及地址；及
(iii)(如公司的已發行股本因該項配發而增加)增加的款額；
(d)須就在有代價下(不論全部或部分屬金錢代價或非金錢代價)配發的任何股份 ——
(i)述明已為或視作已為每一股份繳付的款額，以及(如有的話)尚未為或視作尚未為每
一股份繳付的款額；
(ii)(如屬全部或部分為非金錢代價而按根據第13部第2分部作出的安排進行的配發)載
有認許該安排的原訟法庭的命令的詳情；及
(iii)(如屬在任何其他情況下全部或部分為非金錢代價而進行的配發) 載有該等股份
配發所關乎的售賣合約的詳情，或為服務或其他代價而訂立的合約的詳情；及
(e)須就入帳列為已繳足股款(不論有否經過資本化)的所配發股份 ——
(i)述明視作已為每一股份繳付的款額；及
(ii)載有授權進行該項資本化或配發的決議的詳情。
(3)如有限公司違反第(1)款，該公司及其每名責任人均屬犯罪，可各處第4級罰款，如
有關罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$700。
(4)如有限公司沒有在股份配發後的一個月內，交付符合第(2)款的申報書，原訟法庭
可應有關公司或其責任人的申請，將交付該申報書的限期延長一段由原訟法庭決定
的期間。
(5)原訟法庭須信納以下事項，方可根據第(4)款延長限期 ——
(a)有關公司沒有交付有關申報書，屬意外或無心之失；或
(b)延長限期是公正公平的。
(6)如原訟法庭延長交付申報書的限期，有關公司或其責任人已就第(3)款所指的罪行
招致的法律責任，即告終絕，而第(1)款在猶如提述一個月是提述該延長的限期的
情況下，具有效力。
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LAW B333F Unit 2(2021 Autumn)
(3)Transfer of shares
(a) Shares are personal property股份是非土地財產
In the absence of any restrictive provision contained in the company’s articles of association, they may be
freely transferred from one owner to another. For example, section 11 of the Companies Ordinance
provides that for the purposes of this Ordinance, a company is a private company if:
its articles:
(i) restrict a member’s right to transfer shares;
(ii) limit the number of members to 50; and
(iii) prohibit any invitation to the public to subscribe for any shares or debentures of the company; and
(iv)
it is not a company limited by guarantee.
第622章 《公司條例》 第11條 私人公司
11.私人公司
(1)就本條例而言，如某公司符合以下說明，該公司即屬私人公司 ——
(a)該公司的章程細則 ——
(i)限制成員轉讓股份的權利；
(ii)將成員最高人數限於50人；及
(iii)禁止邀請公眾人士認購該公司的任何股份或債權證；及
(b)該公司不屬擔保有限公司。
(2)在第(1)(a)(ii)款中 ——
成員 (member)不包括 ——
(a)本身是有關公司僱員的成員；及
(b)曾同時是成員及有關公司僱員，但於不再是該公司僱員後仍繼續是成員的人。
(3)就本條而言，如2名或多於2名人士聯名持有公司股份，他們須視為一名成員。
That restriction is imposed by Article 2(2) of the Model Articles which provides that the directors may in
their discretion refuse to register the transfer of a share.
第622H章 《公司(章程細則範本)公告》 附表2 私人股份有限公司的章程細則範本
第2部私人公司
2.本公司屬私人公司
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LAW B333F Unit 2(2021 Autumn)
(1)本公司屬私人公司，據此 ——
(a)成員轉讓股份的權利，受本條指明的方式限制；
(b)成員數目上限是50名；及
(c)任何人不得邀請公眾人士認購本公司的任何股份或債權證。
(2)董事可按其酌情決定權，拒絕登記某股份的轉讓。
(b)
Documentation for transfer of shares
A contract to sell shares need not be made in any particular form and may be oral or written. However,
under section 19 of the Stamp Duty Ordinance (Cap 117), where a sale or purchase of Hong Kong shares
is effected, a contract note must be prepared and stamped with a duty stamp purchased from the
government. A contract note must contain particulars of the transaction. 第117章 《印花稅條例》 第
19條 關於香港證券的售賣及購買的成交單據等 Moreover, in performing that contract, the transfer
of shares can only be completed by a ‘proper instrument of transfer’ (轉讓文書) as required by section
150 of the Companies Ordinance.
第622章 《公司條例》 第150條 關於轉讓文書的規定
150.關於轉讓文書的規定
(1)除非一份妥善的轉讓文書已交付公司，否則該公司不得登記該公司股份的轉讓。
(2)如一項獲得股份的權利已藉法律的施行而傳轉予某人，公司將該人登記為成員的權力，不受
第(1)款影響。
A typical share certificate is shown below. 股票樣式
ABC COMPANY LIMITED
(INCORPORATED IN HONG KONG UNDER
THE COMPANIES ORDINANCE, CAP. 622)
(“THE COMPANY”)
SHARE CAPITAL HK$50,000,000.00
DIVIDED INTO 5,000,000 SHARES
THIS IS TO CERTIFY THAT THE
UNDERNAMED IS REGISTERED AS THE HOLDER OF THE NUMBER OF
FULLY PAID SHARES SHOWN BELOW IN THE COMPANY SUBJECT TO THE
ARTICLES OF ASSOCIATION THEREOF.
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LAW B333F Unit 2(2021 Autumn)
C
ertificate
hareholder
S
ddress
number
A
N
umber of
istinctive
shares
numbers
D
THIS ____ DAY OF ___________ 20____
This certificate must be surrendered before
any transfer of the whole or any portion of the above shares can be
registered.
Figure 2.1
A typical share certificate
(4) Transmission of shares
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LAW B333F Unit 2(2021 Autumn)
(a) The Companies Ordinance provides that the transfer of shares can only be effected by a proper
正確 instrument of transfer (轉讓文書) (section 150).
(b) However, this does not apply when the shares are transmitted by operation of law. (特殊情況下
股票必須轉手)
This occurs on:
(i) bankruptcy(現時的股東破產), when shares will be vested (put) in the trustee in bankruptcy
破產案受託人,
(ii) death(現時的股東死亡) , when shares will be vested in the personal representative遺產代
理人of the shareholder.
(c)
Section 161 of the Companies Ordinance provides that a company is bound to accept any
document which is by law sufficient evidence of probate of the will(遺囑認證) , or letters of
administration(遺產管理書). If a transmittee (i.e. a person entitled to a share by reason of the
death or bankruptcy of a member or otherwise by operation of law) produces evidence of
entitlement to the share as the directors properly require, the transmittee may, subject to the
articles of the company, choose to become the holder of the share or to have the share transferred
to another person. The directors have the same right to refuse or suspend the registration as they
would have had if the holder had transferred the share before the transmission (Article 66 of the
Model Articles).
第622章 《公司條例》 第161條 遺囑認證書批給等的證據
161.遺囑認證書批給等的證據就股份的轉讓或獲得股份的權利的傳轉而言，如有文件向公
司出示，而在法律上，該文件是某死者的遺囑認證書或某死者的遺產管理書的批給的
充分證明，則該公司須接受該文件為該項批給的充分證據。
第622H章 《公司(章程細則範本)公告》 附表2 私人股份有限公司的章程細則範本
66.承傳人的權利
(1)如某承傳人按董事的恰當要求，出示被要求出示的證據，證明本身擁有有關股份的權
利，該承傳人在本《章程細則》的規限下，可選擇成為該股份的持有人，或選擇將該
股份轉讓予另一人。
(2)董事有權拒絕或暫停辦理有關登記，一如假使在有關傳轉前有關持有人已轉讓有關股
份的話，董事本會有權拒絕或暫停辦理登記股份轉讓一樣。
(3)某承傳人有權享有的股息或其他利益，等同於該承傳人假使是有關股份的持有人的話
便會享有者，惟該承傳人在尚未就該股份登記為成員前，無權就該股份行使任何憑藉
成員資格而獲賦予的、關乎本公司會議的權利。
(4)董事可隨時發出通知，要求承傳人選擇成為有關股份的持有人，或選擇將該股份轉讓
予另一人。
(5)如承傳人在自上述通知發出起計的90日內，沒有遵從該通知，董事可在該通知的要求
獲遵從之前，暫緩支付須就該股份支付的所有股息、紅利或其他款項。
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LAW B333F Unit 2(2021 Autumn)
5. Registration (股票註冊)
Under section 627 of the Companies Ordinance, every company shall keep in the English or
Chinese language a register of its members, and enter therein the following particulars:
(a) the names and addresses of its members;
(b) the date on which each person is entered in the register as a member; and
(c) the date on which any person ceases to be a member.
In the case of share allotment, transfer or transmission, when prospective shareholders’ names
are placed in the register, they become members of the company.
第622章 《公司條例》 第627條 成員登記冊
627.成員登記冊
(1)公司須備存一份採用中文或英文的成員登記冊。
(2)公司須將以下詳情記入成員登記冊 ——
(a)其成員的姓名或名稱及地址；
(b)每人被記入該登記冊成為成員的日期；及
(c)任何人不再是成員的日期。
(3)有股本的公司須將述明以下事宜的陳述，連同有關成員的姓名或名稱及地址，記入成
員登記冊 ——
(a)每名成員所持股份，如該等股份有號碼，則須以其號碼將每一股份加以識別；及
(b)已就每名成員的股份繳付的款額，或獲同意視為已就每名成員的股份繳付的款額。
(4)公司須在收到關於第(2)及(3)款規定的詳情的通知後的2個月內，將有關詳情記入成員登
記冊。
(5)如第(2)(c)款所述的人在某日期不再是成員，所有在登記冊內於該日期是關乎該人的記
項，可在自該日期起計的10年的限期結束後，予以銷毀。
(6)公司須保留在緊接第(5)款生效日期#前列入成員登記冊的細節的文本，直至有關成員不
再是成員後的10年為止。
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LAW B333F Unit 2(2021 Autumn)
(7)如公司違反第(1)、(4)或(6)款，該公司及其每名責任人均屬犯罪，可各處第4級罰款，
如有關罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$700。
Section 634 of the Companies Ordinance provides that no notice of any trust (whether
expressed, implied or constructive) may be:
(a) entered in the register of members of a company; or
(b) receivable by the Registrar.
Accordingly, if a person (A) holds the shares on behalf of another (B), a member of the public
can only see A’s name when looking up the register. He will not see B’s name. Similarly,
trustees may find themselves holding a member’s liability. This is particularly the case if shares
are only partly paid for and the company makes a call for the unpaid portion.
第622章 《公司條例》 第634條 信託不得記入登記冊
634.信託不得記入登記冊關於任何明訂、隱含或法律構定信託的通知，均不得 ——
(a)記入有關公司的成員登記冊；或
(b)獲處長接收。
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LAW B333F Unit 2(2021 Autumn)
6. Mortgage of shares (股票作借貸抵押品)
(a) Use of shares as security to borrow
From a shareholder’s perspective, shares represent some measure of wealth and security.
Shareholders can do more than just sit on their shares and wait for dividends to be paid. Shares
are valuable property; so shareholders can use their shares to increase their ability to borrow, and
perhaps to buy even more shares. When a person borrows money, the repayment of the loan may
be secured by collateral (作為抵押的有價值資產) . If a borrower does not repay the loan, the
collateral抵押品is sold to pay the lender. This type of arrangement is called a ‘mortgage’.
(b) What is a mortgage?
Mortgage is a process to effect a borrowing of money with security. 按揭是實現有抵押借款的
一個過程Under such an arrangement:

a borrower provides property to be held by a lender for the term of a loan; 借款人向貸款人提
供財產，由貸款人在貸款期間持有該財產；
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LAW B333F Unit 2(2021 Autumn)
 if the borrower defaults on the loan, the lender may seize the property or sell it to satisfy the
debt; 如果借款人違約不還錢，貸款人可以扣押財產或出售其來償還債務;and
 if the borrower repays the loan the lender will be obliged to return the property intact (完整無
缺) to the borrower. 如果借款人償還貸款，貸款人將有義務將完整無缺的財產退還給
借款人。
(c) The collateral(抵押)
The property that is mortgaged can be land or chattels (動產)(such as a car) or intangible personal
property(抽象的資產權益/非土地財產), such as bank deposits or shares.
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LAW B333F Unit 2(2021 Autumn)
People who own shares can create a mortgage over those shares in two ways:
(1) Legal mortgage法定按揭
A borrower legally transfers shares to a lender on the condition that the shares will be
re-transferred to the borrower upon repayment of the loan. 借款人合法將股票轉讓給貸款
人，條件是在償還貸款後股份將重新轉回給借款人。
(2) Equitable mortgage衡平法按揭
A lender does not immediately become the legal owner of the mortgaged shares. Rather, a
borrower puts the lender in a position where, upon the borrower’s default, the lender may
choose (but is not obliged) to become the legal owner. 貸款人不會立即成為按揭股份的合
法所有人。 相反，借款人將貸款人放置在借款人違約的情況下，貸款人可以選擇（但
不是必要）成為合法所有者。
Equitable mortgages are more common較普及than legal mortgages, and can be created in
one of the following ways: (i) A borrower gives a lender the share certificate and the
completed form of instrument of transfer. The lender guarantees not to register as owner of
the shares until and unless the borrower defaults. 借款人給予貸款人股票和已完成的轉讓
文書。 貸款人保證，除非借款人違約，否則不登記為股份所有人。
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LAW B333F Unit 2(2021 Autumn)
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LAW B333F Unit 2(2021 Autumn)
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LAW B333F Unit 2(2021 Autumn)
(i)
A borrower gives just share certificates to a lender to hold, thereby making it
impossible for the borrower to deal with the shares. 借款人給予貸款人持有
股票，使借款人無法處理股份。
(ii)
A borrower enters into a deed of mortgage of an equitable interest in shares,
for example, where the borrower is a beneficiary of shares held on trust and
enters into a mortgage of that beneficial interest. 借款人訂立股權衡平利益
的抵押契約，例如借款人為信託持有的股份的受益人，並進行抵押。
Some facts about the market
In Hong Kong, some brokers 經紀 engage in the practice of pooling securities belonging to
margin clients, including ‘non-borrowing’ or ‘low-borrowing’ margin clients (i.e. those clients
who borrow very little or not at all, but have a relatively large amount of securities in their
margin accounts) and re-pledging such securities as collateral to obtain bank loans. What kind
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LAW B333F Unit 2(2021 Autumn)
of risks do you think the non-borrowing or low-borrowing margin clients are exposed to under
such a pooling arrangement?
The potential consequences of a pooling arrangement can be dire. If a broker defaults on the
obligation to repay the bank (possibly because a large client was unable to pay the broker),
innocent clients (i.e. non-borrowing or low-borrowing margin clients) could find their shares
being seized to cover the broker’s debt.
The collapse of C.A. Pacific Securities Limited and C.A. Pacific Finance Limited in January
1998 highlighted how margin clients could suffer losses as a result of the crystallization of
pooling risk. At the time of its collapse, C.A. Pacific Finance Limited had a capital of only $16
million, but had borrowed $548 million by re-pledging clients’ collateral of over $2.5 billion.
Allowed compensation claims amounted to $983 million and the Unified Exchange
Compensation Fund made payments totalling $300 million (SFC 2004). After the incident, the
law was tightened to bring securities margin-financing activities within the regulatory
framework administered by the Securities and Futures Commission (SFC)
Buying on margin
https://www.ifec.org.hk/web/en/investment/market-intermediaries/financial-intermediaries/broker/
margin-trading/buying-on-margin.page
孖展交易
https://www.ifec.org.hk/web/tc/investment/market-intermediaries/financial-intermediaries/broker/m
argin-trading/buying-on-margin.page
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LAW B333F Unit 2(2021 Autumn)
(D) Capital maintenance and variation
1.
Doctrine of Capital maintenance資金維持原則
(a)
Traditional Concept
Capital maintenance is a traditional concept. The capital maintenance doctrine was first
developed in the mid-19th century in the UK. The concept of capital maintenance is based on
the belief that a company’s share capital is an untouchable fund公司的股本是不可觸及的資
金. It must be kept available for creditors to claim as the last resort in the event of the
company’s failure如果公司生意失敗，公司的股本必須備存給債權人作為最後的保障.
The share capital must also be maintained to protect the shareholders’ interests in their shares
as long-term investments公司也要保持股本，來保護股東權益，作為長期投資. On the
downside, the doctrine of maintenance of capital means that the share capital contributed by
the shareholders cannot be paid back to them until the company is wound up最壞打算是資本
維持原則意味著在公司清盤之前股東所投資的股本不能償還給他們.
The principle of capital maintenance was laid down by the House of Lords in Trevor v.
Whitworth (1887) 12 App Cas 409. This case stated that a company’s paid-up capital should be
maintained and kept available to meet the company’s liabilities公司的實收資本應當維持並
保留以滿足公司的負債unless除非:
(i) it is lost due to ordinary business risks資本由於普通業務風險而損失; or
(ii) there has been a reduction of the share capital authorized in accordance with the legislation
(i.e. in Hong Kong, the Companies Ordinance). 按照法律(即香港公司條例)規定，授權
的股本減少。
Note: The case abovementioned simply means that return of capital must be restricted, and
shall be allowed only in certain limited situations. 上述情況僅僅是指退回資本必須受到
限制，只能在某些有限的情況下被允許。
Trevor v Whitworth (1887) 12 App Cas 409 is a UK company law case concerning share
buybacks. It held they were unlawful. The case is often used in support for the Capital
Maintenance Rule. The rule coming from the case itself has since been reformed by
statute in several commonwealth countries. In the UK, the rule was reformed in 1980
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LAW B333F Unit 2(2021 Autumn)
and replaced with a statutory procedure so that shares can either be classed as
redeemable or be bought back, under the Companies Act 2006 sections 684-723. In
Australia, share buybacks are allowed under ss 257A-257J of the Corporations Act
2001.
A company bought back almost a quarter of its own shares. During liquidation of the
company, one shareholder applied to court for the balance of amounts owed to him after
the buyback. The Court of Appeal held that he should be paid.
Trevor v Whitworth（1887）12 App Cas 409是一項關於股份回購的英國公司法。 法院認
為股份回購是非法的。 這種情況通常用於支持“資本維護規則”。 案件本身的
規則已經在幾個英聯邦國家由法規改革。 在英國，這項規則於1980年改革，並以
法定程序取代，根據“2006年公司法”第684-723條，股份可以歸類為可贖回或回
購。 在澳大利亞，根據2001年“公司法”第257A-257J條，允許股票回購。
一家公司回購了近四分之一的股份。 公司清盤期間，一名股東在回購後向法院申請餘
額欠款。上訴法院裁定該股東應得到償還。
The House of Lords held the buyback was ultra vires the company. Lord Herschell said the
following,
“ If the claim under consideration can be supported, the result would seem to be this, that
the whole of the shareholders, with the exception of those holding seven individual
shares, might now be claiming payment of the sums paid upon their shares as against
the creditors, who had a right to look to the moneys subscribed as the source out of
which the company’s liabilities to them were to be met. And the stringent precautions to
prevent the reduction of the capital of a limited company, without due notice and
judicial sanction, would be idle if the company might purchase its own shares
wholesale, and so effect the desired result...
I cannot think that the employment of the company’s money in the purchase of shares for any
such purpose was legitimate.” 我不認為公司為任何目的可合法地回購股份。
(b) The former Companies Ordinance followed the old rules in the UK以前的規定
For the purpose of creditor protection as derived from the doctrine of capital maintenance,
there was restricted payment made out of capital to shareholders except in the following ways:
除下列情況外，不能將股本退回給股東：

dividends can only be paid out of distributable profits; 從可分發利潤中派股息
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LAW B333F Unit 2(2021 Autumn)

a court sanction (judgement) is generally required for the reduction of capital, except for
re-designation of the nominal value of shares; 減少股本一般需要法院批准(除了股份
面值重新訂定外)

the purchase by a company of its own shares (‘buy-back’) may generally only be made
out of distributable profits or the proceeds of a new issue, save for certain exceptions; and
除例外情況外，公司一般可從可分發利潤中或新發股份的收益中買回自己的股份。
 financial assistance by a company of the acquisition of its own shares (‘financial
assistance’) is generally prohibited, save for certain exceptions. 除例外情況外，公司一
般禁止資助買回自己的股份。
Obviously, the capital maintenance principle is somewhat misconceived and based on an
overly simplistic view of company finance. 顯然，資本維持原則在某種程度上被誤解
及基於對公司財務過於簡單化的觀點。
2.
Uniform solvency test償付能力測試
(a) Section 204 of the new Companies Ordinance provides that a uniform solvency test
will be applicable to:
(a) reduction of share capital;
(b) share redemption and buy-back, and;
(c) financial assistance.
That means a company can proceed with reduction of capital, buyback
or giving financial assistance for others to acquire its own shares
ONLY if the company shall satisfy the solvency test.
第622章 《公司條例》 第204條 本分部的適用範圍
204.本分部的適用範圍本分部對以下事宜具有效力 ——
(a)第3分部第2次分部所指的藉著通過以償付能力陳述作支持的特別決議而進行的股本減少；
(b)第4分部所指的就贖回或回購股份而從資本中撥款作付款；
(c)第5分部第4次分部所指的由公司給予資助。
(b)
Section 205 states that the solvency test is satisfied if:
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LAW B333F Unit 2(2021 Autumn)
(i)immediately after the transaction, the company will be able to pay its debts;
and (ii) the company will be able to pay its debts within 12 months after the
transaction (if the company intends to commence winding up within 12 months
after the transaction, then within 12 months after commencement of winding
up).
第622章 《公司條例》 第205條 償付能力測試
205.償付能力測試
如 ——(a)在緊接某事宜的進行後，將會沒有認定某公司無能力償付其債項的理由；及(b)有以
下其中一種情況 ——(i)該公司的清盤擬在該事宜的日期後的12 個月內展開，而在展開清盤
後的12 個月內，該公司將會有能力悉數償付其債項；或(ii)屬任何其他情況，而該公司將會
有能力償付其在緊接該事宜後的12 個月內到期的債項，則該公司即屬就該事宜而言通過償
付能力測試。
(c) By section 206(1)), a solvency test means:
a solvency statement (財務聲明/償付能力陳述) that each of the directors
making it has formed the opinion that the company satisfies the solvency test in
relation to the transaction (In forming an opinion for the purpose of making a
solvency statement, a director must: 就某事宜而言，償付能力陳述是內容如下
的陳述：作出該陳述的每名董事已得出意見，認為有關公司就該事宜而言通過
償付能力測試。在為作出償付能力陳述的目的而得出意見時，董事須 ——
- inquire into the company’s state of affairs and prospects; and查究有關公司
的事務狀况及前景；及
- take into account all the liabilities of the company (including contingent and
prospective liabilities) 考慮該公司的所有債務( 包括或有負債及潛在負債)。
(section 206(2)).
(d)Form of a solvency statement償付能力陳述 (section 206(3)): 償付能力陳述
須 ——

must be in the specified form; 符合指明格式[NSC 17]；

must state the date on which it is made;

must state the name of each director making it; and述明 ——
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LAW B333F Unit 2(2021 Autumn)
(i)作出該陳述的日期；及
(ii)每名作出該陳述的董事的姓名或名稱；及

(e)
must be signed by each director making it. 由每名作出該陳述的董事簽署。
Section 207: Consequences for a director making solvency statement without
careful consideration:
A director who makes a solvency statement without having reasonable grounds
for the opinion expressed in it commits a criminal offence. On conviction, the
maximum penalty is $150,000 and imprisonment for two years. Even on
summary conviction (where the offence is considered less serious), the maximum
penalty is a fine at level 6 and imprisonment for six months.
第622章 《公司條例》 第207條 關於償付能力陳述的罪行
207.關於償付能力陳述的罪行
董事在無合理理由支持在償付能力陳述中表達的意見的情況下，仍作出該陳述，
即屬犯罪 ——
(a)一經循公訴程序定罪，可處罰款$150,000及監禁2年；或
(b)一經循簡易程序定罪，可處第6 級罰款及監禁6個月。
3. Maintenance of Capital
(a) Reduction (減少) of share capital
A company limited by shares can only reduce its share capital in accordance with ONE of the
procedures provided by s211 Companies Ordinance, otherwise the company may commit a
criminal offence (s212 Companies Ordinance) as following:
(i)
The Solvency Approach – a Court-free Procedure : by Special Resolution +
Solvency Statement:
The solvency test approach is a court free procedure不需法院批准. It supposes to be a
quicker and simpler method, and it seems to be a much better option for a company which is
clearly solvent (a financially healthy company without much need for supervision from
court). 財政健全資產可償還全部債務Though, companies may still be free to choose the
court confirmation method for the sake of prudence and higher certainty in legality. 公司也
可選擇由法院批准The following criteria and procedures in details must be met:
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LAW B333F Unit 2(2021 Autumn)

All directors must make a solvency statement (section 216(1));

Members’ approval by a special resolution which must be passed within 15 days after the
date of the solvency statement (section 216(2));

A public notice of the reduction is to be published in Gazette stating contents as listed in
section 218(1);

A notice is to be published in at least one specified Chinese and at least one specified
English newspaper or a written notice to be given to its creditors before the end of the
week after the week in which the special resolution is passed (section 218(3));

A copy of the solvency statement is to be delivered to the Registrar for registration
(s218(5));

The company shall allow five weeks’ time for members or creditors of the company to
inspect the special resolution and solvency statement (s219(2));

If no application of objection is raised by dissentient members or creditors to cancel the
resolution, the company can deliver a return between five and seven weeks after the date
of the resolution to the Registrar for registration (section 224(1)); and

The special resolution and the reduction of share capital shall take effect when the return
is registered by the Registrar.
CAP 622 COMPANIES ORDINANCE Section 216 Solvency statement for reduction of
share capital
216.Solvency statement for reduction of share capital
(1)All directors of the company must make a solvency statement that complies with
Division 2 in relation to the reduction of share capital.
(2)The special resolution for reduction of share capital must be passed within 15 days
after the date of the solvency statement.
(3)If the special resolution is proposed as a written resolution, a copy of the solvency
statement must be sent to every member of the company at or before the time when the
proposed resolution is sent to them.
(4)If the special resolution is proposed at a meeting, a copy of the solvency statement
must be made available for inspection by members at the meeting.
第622章 《公司條例》 第216條 關於股本減少的償付能力陳述
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LAW B333F Unit 2(2021 Autumn)
216.關於股本減少的償付能力陳述
(1)公司所有董事須就股本減少一事，作出符合第2分部的償付能力陳述。
(2)議決減少股本的特別決議，須在作出償付能力陳述的日期後的15日內通過。
(3)如有關特別決議是以書面決議形式提出的，則償付能力陳述的文本須在該項決
議送交公司成員之時或之前，送交該公司每名成員。
(4)如有關特別決議是建議在會議上通過的，則須在該會議上，備有償付能力陳述
的文本，供與會的成員查閱。
(5)如第(3)或(4)款(視何者適用而定)不獲遵守，則有關特別決議不具有效力。
CAP 622 COMPANIES ORDINANCE Section 218 Public notice of reduction of share
capital
218.Public notice of reduction of share capital
(1)If a special resolution for reduction of share capital is passed, the company must, on
or before the date specified in subsection (2), publish a notice in the Gazette—
(a)stating that the company has approved a reduction of share capital;
(b)specifying the amount of share capital to be reduced and the date of the special
resolution;
(c)stating where the special resolution and solvency statement are available for
inspection; and
(d)stating that a member of the company who did not consent to or vote in favour of the
special resolution or a creditor of the company may, within 5 weeks after the date of the
special resolution, apply to the Court under section 220 for cancellation of the special
resolution.
(2)The date is—
(a)a date that falls on the last working day of the week after the week in which the
special resolution is passed; or
(b)if the period between the date in paragraph (a) and the date on which the special
resolution is passed is less than 4 business days (both dates exclusive), a date that falls
on the last working day of the week next following.
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LAW B333F Unit 2(2021 Autumn)
Examples—
1.The special resolution is passed on 2 February of a year (Thursday). Apart from
Saturdays and Sundays, all other dates in February of that year are business days. The
date that falls on the last working day of the week after the week in which the special
resolution is passed is 10 February (Friday) of that year. There are 5 business days
between 2 February and 10 February. Therefore, the relevant notice must be published
in the Gazette on or before 10 February (Friday) of that year.
2.The special resolution is passed on 30 March of a year (Friday). Both 4 April
(Wednesday) and 6 April (Friday) of that year are general holidays. 2 April (Monday), 3
April (Tuesday), 5 April (Thursday) and 13 April (Friday) of that year are business days.
The date that falls on the last working day of the week after the week in which the
special resolution is passed is 5 April (Thursday). There are only 2 business days
between 30 March and 5 April. Therefore, the relevant notice must be published in the
Gazette on or before the last working day of the week next following, which is 13 April
(Friday) of that year.
(3)Before the end of the week after the week in which the special resolution for
reduction of share capital is passed, the company must also—
(a)publish a notice to the same effect as the notice under subsection (1) in at least one
specified Chinese language newspaper and at least one specified English language
newspaper; or
(b)give written notice to that effect to each of its creditors.
(4)If the company contravenes subsection (1) or (3), the company, and every responsible
person of the company, commit an offence, and each is liable to a fine at level 3.
(5)The company must deliver to the Registrar for registration a copy of the solvency
statement no later than the day on which the company—
(a)publishes the notice under subsection (1); or
(b)if earlier, first publishes the notice or gives notice to creditors under subsection (3).
(6)If the company contravenes subsection (5), the company, and every responsible
person of the company, commit an offence, and each is liable to a fine at level 5 and, in
the case of a continuing offence, to a further fine of $1,000 for each day during which
the offence continues.
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LAW B333F Unit 2(2021 Autumn)
(7)For the purposes of subsection (2)—
business day ( 辦公日 ) means a day that is not—
(a)a general holiday;
(b)a Saturday; or
(c)a black rainstorm warning day or gale warning day as defined by section 71(2) of the
Interpretation and General Clauses Ordinance (Cap. 1);
working day ( 工作日 ) means a day that is not—
(a)a general holiday; or
(b)a Saturday.
(5)The special resolution is not effective if subsection (3) or (4) (as applicable) is not
complied with.
第622章 《公司條例》 第218條 關於股本減少的公告
218.關於股本減少的公告
(1)如議決減少股本的特別決議獲通過，公司須於第(2)款指明的日期當日或之前，
在憲報刊登公告 ——
(a)述明公司已批准減少股本；
(b)指明將要減少的股本的款額，以及該項特別決議的日期；
(c)述明可在何處查閱該項特別決議及有關償付能力陳述；及
(d)述明沒有同意或沒有表決贊成該項特別決議的公司成員或公司債權人，可在該
項決議的日期後的5個星期內，根據第220條向原訟法庭提出申請，要求撤銷該項決
議。
(2)上述日期是 ——
(a)在有關特別決議通過的星期的下一個星期中的最後一個工作日；或
(b)(如(a)段所述的日期與有關特別決議通過的日期(不包括兩者在內) 相距少於4個
辦公日)在再下一個星期中的最後一個工作日。
例子——
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LAW B333F Unit 2(2021 Autumn)
1.有關特別決議於某年的2月2日(星期四)通過。除星期六及星期日外，該年2月內所
有其他日子均屬辦公日。在該項特別決議通過的星期的下一個星期中的最後一個工
作日是該年的2月10日(星期五)。2月2日與2月10日之間共有5個辦公日。因此，有
關公告須於該年的2月10日(星期五)或之前，在憲報刊登。
2.有關特別決議於某年的3月30日(星期五)通過。該年的4月4日(星期三)及4月6日(星
期五)均為公眾假期。該年的4月2日(星期一)、4月3日(星期二)、4月5日(星期四)及4
月13日(星期五)均屬辦公日。在該項特別決議通過的星期的下一個星期中的最後一
個工作日是4月5日(星期四)。3月30日與4月5日之間只有2個辦公日。因此，有關公
告須於在再下一個星期中的最後一個工作日( 即該年的4月13日(星期五))或之前，
在憲報刊登。
(3)公司亦須在通過議決減少股本的特別決議的星期後的一個星期終結前 ——
(a)在最少一份指明中文報章及最少一份指明英文報章上，刊登與第(1) 款所指的公
告的內容具相同意思的公告；或
(b)向其每名債權人發出具有該意思的書面通知。
(4)如公司違反第(1)或(3)款，該公司及其每名責任人均屬犯罪，可各處第3 級罰款。
(5)公司須在以下日期或之前，將償付能力陳述的文本交付處長登記 ——
(a)公司根據第(1)款刊登有關公告的日期；或
(b)(如早於(a)段所指的日期)公司根據第(3)款首次刊登有關公告的日期，或首次向債
權人發出通知的日期。
(6)如公司違反第(5)款，該公司及其每名責任人均屬犯罪，可各處第5級罰款，如有
關罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$1,000。
(7)就第(2)款而言 ——
工作日 ( working day )指不是以下任何日子的日子 ——
(a)公眾假期；或
(b)星期六；
辦公日 ( business day )指不是以下任何日子的日子 ——
(a)公眾假期；
(b)星期六；或
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LAW B333F Unit 2(2021 Autumn)
(c)《釋義及通則條例》(第1章)第71(2)條所界定的黑色暴雨警告日或烈風警告日。
CAP 622 COMPANIES ORDINANCE Section 219 Inspection of special resolution and
solvency statement
219.Inspection of special resolution and solvency statement
(1)The company must ensure that the special resolution for reduction of share capital
and the solvency statement made in relation to it are kept at its registered office or at a
place prescribed by regulations made under section 657 for the period—
(a)beginning on the day on which the company—
(i)publishes the notice under section 218(1); or
(ii)if earlier, first publishes the notice or gives notice to creditors under section 218(3);
and
(b)ending 5 weeks after the date of the special resolution.
(2)The company must permit a member or creditor of the company to inspect the special
resolution and solvency statement without charge during business hours in that period.
(3)If the company contravenes subsection (1) or (2), the company, and every responsible
person of the company, commit an offence, and each is liable to a fine at level 5 and, in
the case of a continuing offence, to a further fine of $1,000 for each day during which
the offence continues.
(4)If the company contravenes subsection (2), the Court may by order require the
company to permit an immediate inspection.
第622章 《公司條例》 第219條 特別決議及償付能力陳述的查閱
219.特別決議及償付能力陳述的查閱
(1)公司須確保議決減少股本的特別決議及就該項決議作出的償付能力陳述，備存
於公司的註冊辦事處，或備存於根據第657條訂立的規例訂明的地點，備存期
間 ——
(a)於 ——
(i)公司根據第218(1)條刊登有關公告的日期開始；或
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(ii)(如早於第(i)節所指的日期) 公司根據第218(3)條首次刊登有關公告的日期，或首
次向債權人發出通知的日期開始；並
(b)於該項特別決議通過的日期後的5個星期結束。
(2)公司須准許其成員或債權人，在第(1)款所述期間，於辦公時間內，免費查閱有
關特別決議及償付能力陳述。
(3)如公司違反第(1)或(2)款，該公司及其每名責任人均屬犯罪，可各處第5級罰款，
如有關罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$1,000。
(4)如公司違反第(2)款，原訟法庭可藉命令規定該公司准許有關的人作即時查閱。
(ii)
The Court Sanctioned (decision) Approach: By Special Resolution+
Confirmation by the Court:

Sections 226 to 232 of the Companies Ordinance deal with reduction of capital with
court order. In determining whether to approve the reduction, the court would consider
various factors, including whether the reduction is fair 公平between shareholders and
whether creditors’ interests are safeguarded保障股東和債權人.

A company, accompanied by a duly passed special resolution, can request the court to
approve its application for share capital reduction. A company may pass a special
resolution for reduction of share capital and apply by petition呈請 to the court for an
order confirming the reduction. On an application by petition, the court may make an
order confirming the reduction of share capital on any terms and conditions it thinks fit.

The court will only confirm the reduction of share capital: if it is satisfied, with
respect to every creditor of the company who is entitled to object to the reduction of
share capital, that:
(a)
the creditor’s consent has been obtained; or
(b)
the creditor’s debt or claim has been discharged, has determined or has
been secured (Section 229).
第622章《公司條例》 第229條 確認股本減少的原訟法庭命令
229.確認股本減少的原訟法庭命令
(1)原訟法庭如接獲根據第226條藉呈請書提出的申請，可按其認為合適的條款及條件，
作出一項確認股本減少的命令。
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LAW B333F Unit 2(2021 Autumn)
(2)除非原訟法庭就根據第227條有權反對股本減少的每名公司債權人而言，信納 ——
(a)已取得該債權人的同意；或
(b)該債權人的債項或申索已獲清償、已告終結或已獲給予保證，
否則原訟法庭不得確認該項股本減少。
(iii)
Objection to the Special Resolution
If a member or creditor objects to the special resolution, the court may
confirm or cancel the resolution, and on any terms as it thinks fit (section 222). 第222條 原訟法庭
確認或撤銷特別決議的權力
(b) Payment out of capital in respect of Share redemption or Share Buy-back
(i) Background of prohibition of share buy-back
In the past, companies were prohibited from purchasing their own shares because of the rule in
Trevor v. Whitworth (1887) 12 App Cas 409 where it was held that a company could not
purchase its own shares — even though there was an express power to do so in its
memorandum — since that would amount to a reduction of capital.
The rationale behind this decision was that such purchases are dangerous. They can result in a
reduction of capital, which is to the detriment損害of creditors. They can also lead to other
abuses濫用. For example, if the company paid more than the market value of the shares, it
would dilute沖淡the value of the remaining shares. If the company paid too little, it would
increase the value of the remainder. The directors could use share buy-backs to increase the
value of their own holdings or to increase their relative voting power.
(ii)
Funding rules for share redemption or share buy-back
Under the existing law, if a company redeems or buys-back its shares; the amount of money
needed to pay such share redemption or buy-back may be funded by the following resources:
 out of the company’s distributable profits. (section 257(2)(a));
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LAW B333F Unit 2(2021 Autumn)
 out of the proceeds(收益) of a fresh issue of shares made for the purpose of the redemption
or buy-back (section 257(2)(b)); or
 out of capital if a solvency test is passed. Originally, this was only applicable to private
companies.
第622章 《公司條例》 第257條 為贖回或回購作出的付款
257.為贖回或回購作出的付款
(1)某公司如贖回或回購本身的股份，須在贖回或回購時為該等股份付款。
(2)除第(3)及(4)款另有規定外，某公司可就贖回或回購本身的股份 ——
(a)從該公司的可分派利潤中撥款作付款；
(b)從為贖回或回購股份的目的而發行新股份所得收益中撥款作付款；或
(c)按照本次分部從資本中撥款作付款。
(3)上市公司不得就根據第239條在認可證券市場或在核准證券交易所回購本身的股份，從資本
中撥款作付款。
(4)除第(3)款另有規定外，第(5)款提述的付款只可由公司 ——
(a)從該公司的可分派利潤中撥款作出；或
(b)按照本次分部從資本中撥款作出。
(5)第(4)款適用於公司作出付款作為交換以下任何一項的代價 ——
(a)該公司購入關於根據第4或5次分部回購本身股份的任何權利；
(b)根據第5次分部授權的合約更改；或
(c)解除該公司根據第4或5次分部回購本身的股份的任何責任，或更改該項解除。
(iii) Procedure for Redemption or Buy-back of a company’s shares - Court-free
procedure by solvency test – this procedure concerns redemption/buy-back of
company’s shares funded out of capital
This largely follows court-free procedure for reduction of capital as described in the sub-topic 3.
Reduction of share capital (a)(i) above.
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LAW B333F Unit 2(2021 Autumn)
 The main difference is that the company is not required to deliver to the Companies
Registry a return in specified form after the five-week period. The reason is that the
company is required to deliver a similar return [NSC2], which is applicable to all types of
redemption or buy-back of shares (not just those financed out of capital) within 15 days
after the date on which the redeemed or bought-back shares are delivered to the company
under section 270.
第622章 《公司條例》 第270條 贖回或回購股份申報表
270.贖回或回購股份申報表
(1)根據本分部贖回或回購任何股份的公司，須在該等股份交付該公司的日期後的15
日內，將申報表交付處長登記。
(2)上述申報表 ——
(a)須符合指明格式；
(b)須就每一類別贖回或回購的股份，述明 ——
(i)該等股份的數目；及
(ii)該等股份交付該公司的日期；
(c)須載有一項以緊接贖回或回購股份後的時間的狀況為準的股本說明，該說明須符合
第201條；
(d)如屬由上市公司交付登記，則亦須就每一類別贖回或回購的股份述明 ——
(i)就該等股份繳付的最高及最低價格；及
(ii)該公司為該等股份繳付的總款額；及
(e)在贖回或回購所需資金是從資本中撥出的情況下，亦須述明該項付款的詳情，包括
付款日期及款額。
(3)在不同日期並根據不同合約交付公司的股份的細節，可載列於單一份申報表內。如
有此情況，根據第(2)(d)(ii)款規定須述明的款額，是該公司就該申報表所關乎的全部
股份繳付的總款額。
(4)如公司違反第(1)款，該公司及其每名責任人均屬犯罪，可各處第6級罰款，如有關
罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$2,000。
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LAW B333F Unit 2(2021 Autumn)
 The redemption or buy-back must be made no earlier than 5 weeks and no later than 7 weeks
after the date the special resolution is passed, unless otherwise ordered by the court
(section 258). It is because a member or a creditor of the company may apply to the court
for cancellation of such special resolution.
第622章 《公司條例》 第258條 關於從資本中撥款作付款的特別決議
258.關於從資本中撥款作付款的特別決議
(1)除第257(3)條另有規定外，某公司可就贖回或回購本身的股份，按照本次分部藉特
別決議從資本中撥款作付款。
(2)在不抵觸第263條的條文下，就贖回或回購股份而從資本中撥款作付款，須在有關
特別決議的日期後的5個星期之後並在該項決議的日期後的7個星期之前的期間內作
出。
(c) Financial assistance for acquisition of shares
(i) The restrictions and exceptions
Under section 275 of the Companies Ordinance, it is unlawful for a company, or any of its
subsidiaries, to give financial assistance directly or indirectly for the purpose of acquisition of
its shares. Any breach of the prohibition is a criminal offence. The directors concerned may be
prosecuted, which can result in a fine and even imprisonment.
第622章 《公司條例》 第275條 禁止為購入股份或為減少或解除因購入招致的債務而提供資
助
275.禁止為購入股份或為減少或解除因購入招致的債務而提供資助
(1)除本分部有所規定外，如任何人正進行購入或正建議購入某公司的股份，在該項購入進行
之前或同時，該公司或其任何附屬公司不得為該項購入而直接或間接提供資助。
(2)如 ——
(a)某人已購入某公司的股份；而
(b)任何人為該項購入而招致債務，則除本分部有所規定外，該公司或其任何附屬公司不得為
減少或解除該項債務，而直接或間接提供資助。
(3)本條不適用於公司在以下情況下提供的資助︰該公司的控權公司是在香港以外地方成立為
法團的，而該公司提供資助的目的，是為購入該控權公司的股份，或為減少或解除為該項購入
而招致的債務。
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LAW B333F Unit 2(2021 Autumn)
(4)如公司違反第(1)或(2)款，該公司及其每名責任人均屬犯罪，可各處罰款$150,000及監禁12
個月。
(ii) What is ‘Financial assistance’?
It is defined in section 274 of the Ordinance to include gifts, guarantees, security, indemnities,
loans and any other financial assistance ‘given by a company if the net assets of the company are
reduced to a material extent or if the company has no net assets’.
‘Net assets’ = aggregate amount of the company assets – aggregate amount of the company’s
liabilities, as stated in the its accounting period before the financial assistance is given
第622章 《公司條例》 第274條 釋義
274.釋義
(1)在本分部中 ——
負債 (liabilities)包括對為符合以下說明的債務或損失作出撥備屬合理地需要的被保留的款
額 ——
(a)相當可能會招致的債務或損失；或
(b)確定會招致但款額或產生日期仍未確定的債務或損失；
淨資產 (net assets)就根據本分部提供資助的公司而言，指公司資產總額超出公司負債總額之數(以
緊接提供資助前公司的會計紀錄所述明的資產額及負債額計算)；
資助 (financial assistance)指 ——
(a)藉饋贈而提供的資助；
(b)以下述方式而提供的資助 ——
(i)擔保、保證或彌償(就彌償人本身的疏忽或失責而作出的彌償除外)；或
(ii)責任解除或寬免；
(c)以下述方式而提供的資助 ——
(i)貸款協議或任何其他協議，而根據該等協議，當於協議另一方的責任按照協議仍未履行時，提
供資助的人的責任須予履行；或
(ii)第(i)節提述的貸款協議或其他協議的約務更替，或根據第(i)節提述的貸款協議或其他協議而產
生的權利轉讓；或
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LAW B333F Unit 2(2021 Autumn)
(d)任何公司在以下情況下提供的任何其他資助 ——
(i)公司淨資產會因提供該項資助而出現相當程度的減少；或
(ii)該公司沒有淨資產。
(2)在本分部中 ——
(a)提述某人招致債務，包括該人藉訂立協議或安排(不論是否可強制執行，亦不論是否由該人獨
自或連同他人訂立)或藉任何其他方法，而改變該人的財務狀況；及
(b)提述某公司為減少或解除某人因購入股份而招致的債務而提供資助，包括該公司為使該人的財
務狀況完全或部分回復至購入進行前的狀況而提供資助。
(iii) What is ‘Acquisition’?
‘Acquisition’ covers both share transfers股份轉讓and share subscriptions股份認購.
(iv) Exceptions to the rule in s275
The rule in s 275 is subject to a number of exceptions. It means that if any financial assistance
given by a private company for acquisitions of its own shares falls within the situations
described in the exceptions, then it will not violate s 275 and shall be allowed to proceed. Some
of which are listed below:
a. the payment of dividends; distribution of assets to creditors in winding-up; allotment of
bonus shares; reduction of capital confirmed by the court (section 277);
第622章 《公司條例》 第277條 一般例外情況
277.一般例外情況
本分部並不禁止任何以下事宜 ——(a)公司的資產 ——(i)以合法派發股息的形式分派；或(ii)
在該公司的清盤過程中分派；(b)紅股的配發；(c)公司股本按照第3分部減少；(d)按照第4
分部進行的公司贖回或回購本身的股份；(e)按照第13部第2分部(安排及妥協)所指的法庭
命令而作出的任何事情；(f)按根據《公司(清盤及雜項條文)條例》(第32章)第237條(清盤
人接受股份等作為出售公司財產的代價的權力)作出的安排而作出的任何事情；(g)根據一
項由公司與其債權人訂立並因《公司(清盤及雜項條文)條例》(第32章)第254條(債務償還
安排何時對債權人有約束力)而對該等債權人具約束力的債務償還安排而作出的任何事
情。
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LAW B333F Unit 2(2021 Autumn)
b. where the ordinary business of the company is lending money (section 279);
第622章 《公司條例》 第279條 貸款業務的例外情況
279.貸款業務的例外情況在第282條的規限下，本分部並不禁止以借出款項為其通常業
務一部分的公司在通常業務運作中借出款項。
c. the giving of assistance by a company, in good faith in the interests of the company, of
financial assistance for the purposes of an employee share scheme (section 280);
第622章 《公司條例》 第280條 僱員參股計劃的例外情況
280.僱員參股計劃的例外情況(1)在第282條的規限下，本分部並不禁止 ——(a)公司真
誠地為了該公司的利益，而為僱員參股計劃的目的提供資助；或(b)某公司(出資公司)為本
身或與其同屬一個公司集團成員的另一公司為有關目的而作出的任何事情而提供資助，或
在與該等事情有關連的情況下提供資助，上述“有關目的”，是讓出資公司或其控權公司的
股份在以下人士之間進行的、涉及以下人士購入該等股份的實益擁有權的交易得以進行，
或利便該等交易進行 ——(i)正真誠地受僱於或曾真誠地受僱於出資公司或與其同屬一個
公司集團成員的另一公司的人；或(ii)第(i)節提述的人的配偶、遺孀、未亡夫或未成年子
女。(2)在本條中 ——子女 (children)包括繼子女、非婚生子女及以香港法律承認的任何方
式領養的子女；未成年子女 (minor children)指未滿18歲的子女；僱員參股計劃 (employee
share scheme)指旨在鼓勵或利便由以下的人持有或為以下的人的利益而持有公司股份的
計劃 ——(a)正真誠地受僱於或曾真誠地受僱於該公司或與其同屬一個公司集團成員的另
一公司的人；或(b)(a)段提述的人的配偶、遺孀、未亡夫或未成年子女。or
d. where the company makes a loan to its eligible employees (other than directors), for the
purpose of enabling them to acquire fully paid shares in the company or its holding
company to be held by them by way of beneficial ownership (section 281).
第622章 《公司條例》 第281條 貸款給僱員的例外情況
281.貸款給僱員的例外情況(1)在第282條的規限下，本分部並不禁止公司為使其合資格
的僱員能購入並以實益擁有權的方式持有該公司或其控權公司的繳足股款的股份，
而向該等僱員借出貸款。(2)在本條中 ——子女 (child)包括繼子女、非婚生子女及
以香港法律承認的任何方式領養的子女；合資格的僱員 (eligible employees)就公司
而言，指真誠地受僱於該公司而並非以下人士的人 ——(a)該公司的董事；(b)董事
的配偶；(c)董事的未滿18歲的子女；(d)符合以下說明的信託(第280(2)條所界定的
僱員參股計劃或退休金計劃除外)的受託人 ——(i)該項信託的受益人包括(a)、(b)
或(c)段提述的人；或(ii)該項信託的條款授予受託人一項可為(a)、(b)或(c)段提述的
人的利益而行使的權力；或(e)(a)、(b)或(c)段提述的人的合夥人或(d)段提述的受託
人的合夥人。
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[For reference]

If the company is a listed company, the exceptions listed in (b), (c) and (d) above
apply only where the financial assistance does not reduce the company’s net assets or,
if it does, it is provided out of distributable profits (section 282)
第622章 《公司條例》 第282條 對上市公司的特別限制
282.對上市公司的特別限制只有在符合以下條件的情況下，第279、280或281條才
適用於上市公司 ——(a)該公司擁有沒有因提供有關資助而減少的淨資產；或(b)
該等資產因此而減少，而在減少的範圍內，有關資助是從可分派利潤中獲得提供
的。

If the company is a private company, any of the exceptions (a) (b) (c) and (d) shall
apply without restrictions.
(v) The Procedure
By way of the exceptions listed in (iv) Exceptions to the rule in s275 above, a private
company can provide financial assistance, subject to a solvency test; and one of the three
procedures stated in sections 283 to 285. The criteria for allowing financial assistance can be
given in each of the three procedures as following:
 The first procedure (section 283):
(i) directors pass a resolution to give the assistance;
(ii) those directors make a solvency statement;
(iii)the aggregate amount and other assistance given under this section not yet repaid (such as
guarantee or security) does not exceed 5% of the paid up share capital and reserves of the
company; and
(iv) the assistance is given within 12 months of the solvency statement.
(v) Within 15 days after giving the assistance, the company must send the solvency statement and
a notice to all members (section 283(4)).
第622章 《公司條例》 第283條 資助不得超過股東資金的5%
283.資助不得超過股東資金的5%(1)如符合以下條件，公司可為購入其股份或其控權公司的
股份而提供資助，或為減少或解除為該項購入而招致的債務而提供資助 ——(a)董事在
提供該項資助前議決 ——(i)該公司應提供該項資助；(ii)提供該項資助符合該公司的最
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佳利益；及(iii)提供該項資助的條款及條件，對該公司而言屬公平及合理；(b)董事通過
該項決議的同一日，表決贊成該項決議的董事就提供該項資助作出符合第2分部的償付
能力陳述；(c)該項資助加上任何其他根據本條提供但尚未償還的資助的總數，不超過
該公司的已繳股本及儲備(以公司最新經審計的財務報表內披露者為準)的5%；及(d)該
項資助是在根據(b)段作出償付能力陳述的日期後的12個月內提供的。(2)董事根據第
(1)(a)款通過的決議，須詳列他們對第(1)(a)(i)、(ii)及(iii)款提述的事宜所下結論的理由。
(3)在第(1)(c)款中，提述任何其他根據本條提供但尚未償還的資助，包括以擔保或保證
的形式提供的資助的款額，而在提供該資助時，公司是仍然就該擔保或保證負有法律責
任。(4)公司須在根據本條提供資助後的15日內，向其每名成員送交根據第(1)(b)款作出
的償付能力陳述的文本，及載有下列資料的通知 ——(a)提供該項資助所關乎的股份的
類別及數目；(b)已就或須就該等股份支付的代價；(c)獲得該項資助的人的姓名或名稱，
如獲得資助的人是不同的人，該等股份的實益擁有人的姓名或名稱；(d)該項資助的性
質、條款及款額。(5)如公司違反第(4)款，該公司及其每名責任人均屬犯罪，可各處第3
級罰款，如有關罪行是持續的罪行，則可就該罪行持續期間的每一日，另各處罰款$300。
 The second procedure (section 284):
This has the same requirements as above except that for (iii), the giving of the assistance is
approved by a written resolution of all members of the company before the assistance is given.
第622章 《公司條例》 第284條 經公司所有成員批准的資助
284.經公司所有成員批准的資助(1)如符合以下條件，公司可為購入其股份或其控權公司的
股份而提供資助，或為減少或解除為該項購入而招致的債務而提供資助 ——(a)董事在提供
該項資助前議決 ——(i)該公司應提供該項資助；(ii)提供該項資助符合該公司的最佳利益；
及(iii)提供該項資助的條款及條件，對該公司而言屬公平及合理；(b)董事通過該項決議的同
一日，表決贊成該項決議的董事就提供該項資助作出符合第2分部的償付能力陳述；(c)在提
供該項資助之前，該公司所有成員藉書面決議批准提供該項資助；及(d)該項資助是在根據
(b)段作出償付能力陳述的日期後的12個月內提供的。(2)董事根據第(1)(a)款通過的決議，須
詳列他們對第(1)(a)(i)、(ii)及(iii)款提述的事宜所下結論的理由。
 The third procedure (section 285):
(i) It provides that a company may give assistance if it is approved by an ordinary resolution.
(ii) This section requires the directors to show that the assistance is of benefit to those members
not receiving the assistance, and the terms are fair and reasonable not just to the company but
also to members not receiving the assistance.
(iii) The company must send the solvency statement and a notice to members informing them of
the details of the assistance at least 14 days before the resolution is to be passed.
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(iv)The financial assistance must not be given within 28 days after the ordinary resolution is
passed, during which period an application may be made to the court to restrain the assistance
by members representing not less than 5% of the total voting rights.
第622章 《公司條例》 第285條 藉普通決議而提供資助
285.藉普通決議而提供資助(1)如符合以下條件，公司可為購入其股份或其控權公司的股份而
提供資助，或為減少或解除為該項購入而招致的債務而提供資助 ——(a)董事在提供
該項資助前議決 ——(i)該公司應提供該項資助；(ii)提供該項資助符合該公司的最佳
利益，並惠及該公司沒有接受該項資助的成員；及(iii)提供該項資助的條款及條件，
對該公司及該公司沒有接受該項資助的成員而言屬公平及合理；(b)董事通過該項決
議的同一日，表決贊成該項決議的董事就提供該項資助作出符合第2分部的償付能力
陳述；(c)該公司向其每名成員送交根據(b)段作出的償付能力陳述的文本，及載有下
列資料的通知 ——(i)該項資助的性質及條款，及將會接受該項資助的人的姓名或名
稱；(ii)如該項資助將會提供予另一人的代名人，該另一人的姓名或名稱；(iii)董事的
決議的全文；(iv)對一名合乎常理的成員理解該項資助的性質及該項資助對公司和公
司成員的影響屬必要的進一步資料及解釋；(d)在提供該項資助前，已獲公司的決議
批准提供該項資助；及(e)該項資助是在以下期間提供的 ——(i)根據(d)段通過決議的
日期後的28日或之後；及(ii)於根據(b)段作出的償付能力陳述的日期後的12個月內。
(2)上述通知及償付能力陳述的文本，須在建議第(1)(d)款所指的決議的日期前最少
14日根據第(1)(c)款送交每名成員，並可隨附於關於將會建議通過該決議的大會的通
知。(3)儘管有第(1)(e)(i)款的規定，如有人就根據本條提供的資助而根據第286條向
原訟法庭提出申請，則除非原訟法庭另有命令，否則在該申請獲終局裁定前，不得
提供該項資助。(4)董事根據第(1)(a) 款通過的決議，須詳列他們對第(1)(a)(i)、(ii)
及(iii)款提述的事宜所下結論的理由。
E. How do companies own shares in other
companies?
Subject to its articles of association, a company has all the legal rights and powers of a natural
person. So in general, provided that its articles permit it, a company may buy shares in another
company. This, however, could contravene the principle of capital maintenance in one of the
following scenarios:
 if a company diffuses發散its capital among several entities, instead of leaving it concentrated
in a single entity; or
 if two companies owned each other’s shares, the capital of each would be dependent 依賴on
the financial soundness 財政健全of the other.
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Hong Kong companies however have always been allowed to buy shares in other companies and
therefore form subsidiaries and hold their shares. Nevertheless, the Companies Ordinance does
recognize that the right of companies to hold other companies’ shares violates the spirit of the
principle of capital maintenance. Hence, the Companies Ordinance recognizes that where one
company controls another for certain purposes, the two companies should be treated as one
entity. This arises particularly in relation to accounts. The Ordinance requires that a holding
company’s balance sheet and profit and loss statement should be consolidated with those of its
subsidiaries. 母公司的資產負債表和損益表應與其子公司合併
In general terms, the subsidiary-holding company relationship exists wherever one company
controls more than half the voting power or the composition of the board of directors of another
company. 任何一家公司控制另一家公司一半以上的表決權或另一家公司的董事局組成的
人員，則兩家公司存在母公司和子公司的關係。This usually means that wherever a company
owns 50% or more of another company’s shares, the first company will be the holding company
of the second, the subsidiary. Equally, any company that controls the immediate holding
company of a subsidiary will also be a holding company of that subsidiary. This means that a
group will be a hierarchy comprising subsidiaries, some of which may be intermediate holding
companies, and an ultimate holding company, which is a subsidiary of no other company.
F. Reorganization within a group of companies
When a company reorganizes its share capital — without altering or reducing its authorized
capital — it is called an arrangement. This can occur, for instance, if different classes of shares
are created or amalgamated. If an arrangement is also an amendment to the rights of creditors it
is, in addition, a compromise. Accordingly, an arrangement is a share capital reorganization that
affects the rights of all or a class of shareholders, while a compromise is a share capital
reorganization that affects the rights of creditors as well as shareholders.
Under sections 673 and 674(1) of the Companies Ordinance, where a scheme is proposed
between a company and its members or creditors or any class of them, the court may order a
meeting of the members or creditors or a class of them to be summoned. At the meeting, if a
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majority in number (‘headcount test’) representing 75% in value (‘share value test’) of the
creditors or members (or classes of creditors or members) present and voting at the meeting agree
to the proposed scheme, the scheme shall, if sanctioned by the court, be binding on all members
or creditors and the company, as the case may be.
The major concerns were that the test is contrary to the ‘one share, one vote’ principle and its
inherent problems, that voting could be manipulated through share splitting, as well as the
difficulty of reflecting the wish of the overwhelming majority of listed shares held in the names
of nominees and custodians.
As result, section 674(1)(c)(ii) and (d)(ii) of the Companies Ordinance now gives the court a
discretion to dispense with the headcount test for members’ schemes in special circumstances,
such as where there is evidence that the result of the vote has been unfairly influenced by share
splitting.
A new procedure is created by section 674(2)(a)(ii) and (b)(ii) of the Companies Ordinance with
respect to the following two types of schemes of arrangement, whereby the ‘headcount test’ is
replaced by the requirement that the number of votes cast against the resolution to approve a
scheme of arrangement is not more than 10% of the votes attached to all disinterested shares:
 takeover offer within the meaning of section 674(5); and
 general offer for share buy-back within the meaning of section 707.
‘Disinterested shares’ is defined in section 674(3) and basically means shares held by
non-interested parties. Parties that may be included as ‘interested parties’ are: (i) the company
which makes the buy-back offer and the non-tendering member, plus their associates and
nominees; and (ii) the offeror and his associates and nominees. The term ‘associate’ is defined
in section 667 (CR 2013b).
Very often, arrangements occur during the liquidation of companies. An example of an
arrangement in liquidation occurred in relation to the winding-up of the Bank of Credit and
Commerce (Hong Kong) Limited. The creditors, who were mainly depositors, agreed to a
compromise. Those creditors owed less than $100,000 received immediate repayment of their
deposits. Larger depositors are repaid a high percentage of their deposits as assets are liquidated
and money becomes available.
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G. Reconstructions, amalgamations and takeovers
There are different ways a company can reconstitute its financial structure in conjunction with
other companies. Essentially, there are three ways:

Reconstruction: This occurs when a company (the transferor) resolves to wind up
voluntarily and authorizes the liquidator to sell its whole business undertaking to another
company. The receiving company normally will have been specially incorporated for the
purpose of continuing the transferor’s business. If so, it is likely that the transferor will
receive shares in the receiving company to distribute to its shareholders.

Amalgamation: This occurs when two companies merge their business undertakings
under the ownership and control of one of the companies or of a third company.

Takeover:
This occurs where one company, rather than acquiring the business
undertaking of another, acquires control of the other company by purchasing a majority of
its shares.
(a) Reconstruction and amalgamation
Reconstructions and amalgamations are not so common in Hong Kong. Most commonly and
publicly, they have occurred with banks and deposit-taking companies.
Under the former Companies Ordinance, reconstructions and amalgamations would result in
compromises and arrangements (discussed in the last topic) that must be sanctioned by the
court and affected creditors and shareholders. Given the high costs involved, reconstructions
and amalgamations were rare in Hong Kong.
Now, a court-free regime for amalgamations has been introduced by the new Companies
Ordinance, which, however, is confined to amalgamations of wholly-owned intra-group
companies. This restriction is intended to minimize the risk of abuse, since minority
shareholders’ interest would normally not be an issue in the case of intra-group restructuring.
Sections 680 and 681 provide that an amalgamation may either be vertical (i.e. between the
holding company and one or more of its wholly-owned subsidiaries) or horizontal (i.e.
between two or more subsidiaries of the same holding company). With respect to each type of
amalgamation, the board of directors of each amalgamating company must make a statement,
details of which are set out in section 679, among others, (i) to confirm that none of the assets
of the amalgamating company is subject to any floating charge, or if there exists a floating
charge, the chargee has consented to the amalgamation proposal, and (ii) to verify the
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solvency of the amalgamating company as well as the amalgamated company. The
amalgamation proposal must be approved by the members of each amalgamating company by
special resolution.
According to section 685(3), on the effective date of an amalgamation:

the amalgamation takes effect;

each amalgamating company ceases to exist as an entity separate from the amalgamated
company; and

the amalgamated company succeeds to all the property, rights and privileges, and all the
liabilities and obligations, of each amalgamating company.
There will be a question of priorities between the competing security holders over the assets if
two or more of the amalgamating companies have floating charges subsisting over their
respective assets in favour of different security holders. To resolve this, the written consents of
the holders of the floating charges are therefore required; see sections 680(2)(d)(ii) and
681(2)(d)(ii)).
Section 686 provides that if the court is satisfied that giving effect to an amalgamation
proposal would unfairly prejudice a member or creditor of an amalgamating company or a
person to whom an amalgamating company is under an obligation, it may, on application by
the member, creditor or person made before the date on which the amalgamation becomes
effective, make any order it thinks fit in relation to the amalgamation proposal. This statutory
provision allows the court to intervene for the purpose of protecting the interest of the minority
shareholders and creditors in the course of amalgamation (CR 2013b).
(b) Takeover as opposed to transfer of business
In general law, it is difficult to transfer the business undertaking of a company or any other
business entity. The business undertaking is nothing more than a series of contracts between a
company and its clients. While the benefits of a contract — the right to receive payment, for
instance — can be transferred from one person to another, the liabilities of a contract — such
as the obligation to perform work, for instance — cannot be transferred. The only way that an
unperformed contract can be transferred is by ‘novation’, that is, by the formation of a new
contract between the transferee and the party to whom the contractual liability is due. For this
reason, section 675(2) of the Companies Ordinance empowers the court to order ‘the transfer
of the transferor’s property, undertaking or liabilities, or any part of it or them, to the
transferee’ to facilitate reconstructions and amalgamations.
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In particular, section 675(8) defines ‘property’ as including rights and powers of a personal
character and incapable of being assigned or performed vicariously under the law; and rights
and powers of any other description. ‘Liabilities’ is defined as including duties of a personal
character and incapable of being assigned or performed vicariously under the law; and duties
of any other description. These provisions are specifically drafted to cure a loophole under
the former Companies Ordinance that based on decided cases, a transfer order made under
section 167 of the former Companies Ordinance could not effectuate the transfer of a contract
of personal service. Hence, contracts of employment were not transferable under the former
Companies Ordinance (CR 2013b).
By comparison, takeovers usually are far simpler. The target company normally does not
participate in the process. All that occurs is that one company makes an offer to shareholders
of the target company. Such an offer is usually subject to a condition precedent, which
requires that the offer must be accepted by a stated proportion of shareholders. Unless that
proportion of shareholders accepts the offer, no contract to purchase the shares will have been
formed. If, as a result of its offer, the acquiring company obtains control of the target
company, the takeover will have been successful.
The former Companies Ordinance provided little guidance for the conduct of takeovers. After
the rewrite, the Companies Ordinance now contains more provisions governing the takeovers.
Section 689 of the Companies Ordinance defines an offer to acquire shares in a company is a
takeover offer if:

it is an offer to acquire all the shares, or all the shares of any class, in the company,
except those that, at the date of the offer, are held by the offeror; and

the terms of the offer are the same — (i) where the offer does not relate to shares of
different classes, in relation to all the shares to which the offer relates; or (ii) where the
offer relates to shares of different classes, in relation to all the shares of each class to
which the offer relates.
Section 692 creates a new mechanism that a revision of the terms of a takeover offer is not
regarded as the making of a fresh offer if:

the terms of the offer make provision for (i) their revision; and (ii) acceptances on the
previous terms to be treated as acceptances on the revised terms; and

the revision is made in accordance with that provision.
Under Division 4 (‘Compulsory Acquisition after Takeover Offer’) of the Companies
Ordinance, the offeror has the right to buy-out the minority shareholders if it has acquired not
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less than 90% of the shares for which the offer is made. A corresponding right is also
provided for a minority shareholder to compel the acquirer to buy the shareholder’s shares
under Division 5 (‘Compulsory Acquisition after General Offer for Share Buy-back’).
To cater for situations where there are untraceable shareholders, sections 693(3) to (7) of the
Companies Ordinance empowers the court to make an order to give notice to buy out
minority shareholders in situation where the offeror is unable to achieve the necessary
squeeze out threshold, if it is satisfied that:

after reasonable enquiry, the offeror has been unable to trace one or more of the persons
holding shares to which the takeover offer relates;

had the person, or all those persons, accepted the takeover offer, the offeror would have,
by virtue of acceptances of that offer, acquired, or contracted unconditionally to acquire,
at least 90% in number of the shares, or the shares of any class, to which that offer
relates; and

the consideration offered is fair and reasonable.
Such a mechanism has been in place in the UK since 1987 and is considered to be practical
and useful.
More information can be obtained from
https://iclg.com/practice-areas/mergers-and-acquisitions-laws-and-regulations/hong-kong.
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References
Companies Registry (2008) ‘Third public consultation on Companies Ordinance rewrite — Chapter 3: The
capital maintenance regime’, http://www.cr.gov.hk/en/publications/docs/062008_ch3-e.pdf.
—— (2013a) ‘New Companies Ordinance: Briefing notes on Part 5 — Transactions in relation to share
capital’, http://www.cr.gov.hk/en/companies_ordinance/docs/briefingnotes_part05-e.pdf.
—— (2013b) ‘New Companies Ordinance: Briefing notes on Part 13 — Arrangements, amalgamation, and
compulsory share acquisition in takeover and share buy-back’,
http://www.cr.gov.hk/en/companies_ordinance/docs/briefingnotes_part13-e.pdf.
Financial Services and the Treasury Bureau (2009) ‘Consultation conclusions on share capital, the capital
maintenance regime, statutory amalgamation procedure’,
http://www.fstb.gov.hk/fsb/co_rewrite/eng/pub-press/doc/cmrsap_conclusion_e.pdf.
—— (2010) ‘Second phase consultation of the draft Companies Bill — consultation paper highlights’,
http://www.fstb.gov.hk/fsb/co_rewrite/eng/pub-press/doc/2nd_Consolidated.Explantory.Notes.Part4_e.pdf.
Legislative Council (2006) ‘Background brief on proposed measures to address risks arising from securities
margin financing — Panel on Financial Affairs meeting on 6 February’, LC Paper No. CB(1)806/05-06(10),
http://www.legco.gov.hk/yr05-06/english/panels/fa/papers/fa0206cb1-806-10e.pdf.
Securities and Futures Comission (2004) ‘A Consultation paper on proposed measures to address risks arising
from securities margin financing’,
http://www.sfc.hk/edistributionWeb/gateway/EN/consultation/openFile?refNo=04CP3.
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