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Phase 3 of Hong Kong’s New Inspection Regime Comes into Operation

On 27 December 2023, Hong Kong implemented the third phase of the New Inspection Regime under the Companies Ordinance (Cap. 622) (“CO”) The last instalment of the sweeping amendments first introduced in 2021 enables directors, company secretaries, and other relevant parties to apply for their personal information to be withheld from public view.

Implemented in three phases that spanned August 2021 to December 2023, the New Inspection Regime was launched amidst growing concerns regarding the adequate protection of sensitive personal information in public registers. Hong Kong’s Companies Registry (“Registry”) maintains the Companies Register (“Register”), which holds personal information that is publicly accessible. This includes the residential addresses and identification numbers of company officers. The regime, therefore, seeks to bolster the protection of such information while still enabling public access to the register in the interests of transparency.

This article will provide an overview of Phases 1 and 2 of the New Inspection Regime. In addition, it will highlight the key changes in the final phase and outline how you can apply to withhold personal information from public inspection.

Background: What is the New Inspection Regime?

Implemented in three phases, the New Inspection Regime under the CO first came into operation on 23 August 2021. It is applicable to both locally incorporated companies and non-local companies registered in Hong Kong.

Prior to its implementation, the public could access the usual residential addresses (“URAs”) and full identification numbers (“IDN”) of directors, company secretaries, and other relevant parties. Under the new regime, URAs and full IDNs are deemed Protected Information (“PI”) and are, thus, shielded from public view. Instead, these have been replaced by correspondence addresses and partial IDNs, which are made publicly accessible on the Register.

The new regime aims to improve the safeguarding of sensitive personal information while maintaining the transparency of the Register. It acknowledges the importance of public access to relevant information on a company and its officers for the purposes specified under the CO. These include, for example, ascertaining the legitimacy and legal standing of a company and conducting due diligence.

Overview of the first phase

The first phase of the New Inspection Regime was rolled out on 23 August 2021. The URAs and full IDNs (i.e., identity card or passport number) of directors, including reserve directors, and company secretaries can be withheld from public inspection. Instead, correspondence addresses and partial IDNs are shown on companies’ own registers.

You must provide the correspondence address of a director, including a reserve director, who must be a natural person. In addition, the correspondence address must not be a post office box number.

Where an IDN contains an even number of alphanumeric characters (excluding spaces, punctuations marks, and symbols), the first half of the sequence must be made publicly accessible.

Where an IDN contains an odd number of alphanumeric characters (excluding spaces, punctuation marks, and symbols), the section from the beginning to the middle of the sequence must be displayed.

For more information about the first phase, read our article Protecting Your Personal Data by Utilizing Hong Kong’s New Inspection Regime

Overview of the second phase

The second phase of the New Inspection Regime came into effect on 24 October 2022. The Index of Directors on the Register will display partial IDNs and correspondence addresses in lieu of URAs and full IDNs. Any PI included in documents submitted for registration after the commencement date will not be available for public inspection.

Access to PI on the Register is restricted to designated individuals known as Specified Persons for performing specific duties. These include those mandated by statutory procedures as well as for law enforcement and customer due diligence purposes. The definition of “Specified Persons” encompasses:

  • The director, company secretary, or relevant person who is the subject of the PI;
  • A company member;
  • Certain non-financial businesses and regulated professions that fall under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615). The misuse of PI can lead to disciplinary sanctions and proceedings from the relevant professional association or regulatory authority.

Registered office address as correspondence address

In addition, it is mandatory to include the correspondence address of all natural-person directors in the register of directors. This requirement extends to reserve directors and must be satisfied prior to the first annual return date.

If a director wishes to use their residential address as the correspondence address, a Form ND2B “Notice of Changes in Particulars of Company Secretary and Director” must be filed. It should be noted, however, that such information will be in public view. Otherwise, the registered office address will automatically be deemed the correspondence address, in which case no additional filing is required.

Revision of forms

The Registrar of Companies (“Registrar”) updated 26 forms relating to the reporting of PI. Key changes included:

  • Adjusting the relevant fields to facilitate the reporting of correspondence addresses of directors as well as partial IDNs of directors, company secretaries, and other individuals;
  • Introducing a “PI Sheet” to be affixed to each form, which is not accessible to the public on the Register.

For a detailed discussion of the second phase, read our article “Hong Kong: New Inspection Regime Phase II”.

Key changes in the third phase

The third and last phase of the New Inspection Regime came into force on 27 December 2023. A data subject, i.e., a person who is the subject of the PI, can apply to the Registry for the withdrawal of their URA and full IDN contained in documents filed before the commencement date of Phase 2. This information will be replaced with their correspondence address and partial IDN. Nevertheless, Specified Persons can still submit requests to the Registry to obtain access to the PI.

A director, reserve director, or company secretary, or someone who previously held one of these positions may submit an application. Upon approval, the Registrar will make available the address listed as the applicant’s chosen correspondence address in the application, removing their URA from public visibility. An application to withhold the full IDN from public view can also be made.

To facilitate the implementation of the third phase, the Registrar has introduced a new Form MPI “Application to Withhold Residential Address or Identification Number from Public Inspection”. In addition, the Registrar has revised three existing forms, all under the same name “Application for Disclosure of Withheld Information / PI”:

  • Form PS1 – to be submitted by the data subject, a person authorised by the data subject, or a member of the data subject’s company.
  • Form PS2 – to be submitted by a liquidator, trustee in bankruptcy, and public bodies.
  • Form PS3 – to be submitted by a solicitor, practising Certified Public Accountant, and financial institutions.
Application procedure to withhold Protected Information

As mentioned further above, you must be a data subject to apply for your PI to be withheld from public inspection. A director, reserve director or company secretary as well as former holders of these positions can apply to restrict public access to their URA. Any person whose full IDN is shown in a document delivered to the Registry is also eligible to apply. However, it should be noted that only documents submitted under the CO, the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32), and the Companies Ordinance (Cap. 32) prior to the promulgation of the CO fall within scope.

You have the option to apply in person, by post, or electronically. You will need to complete Form MPI “Application to Withhold Residential Address or Identification Number from Public Inspection”.

  • – When applying to the Registry in person, you must present the original of your passport or Hong Kong Identity Card.
  • – When applying by post, you must provide a certified copy of the identification document.
  • – When applying electronically via the Registry’s e-Services Portal, you need not provide any supporting documents.
What CW can do for you

The arrangements under the New Inspection Regime bring forth a range of implications, requiring a keen focus on both practical compliance matters and the need to update directors of these pivotal changes. At CW, we understand that your time and resources would be better spent on growing your business and delivering value to your customers. Our bespoke Corporate Secretarial services are designed to alleviate the burden of navigating all kinds of regulatory changes, whether they be big or small. In addition to comprehensively assessing implications of the New Inspection Regime for your business, we can help you ensure compliance and take care of all statutory procedures to safeguard the data privacy of your company officers.

Contact us to find out how we can help.