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A nominee director in Hong Kong is a non-executive director appointed for the purpose of protecting the identity of another company director. Because the Hong Kong company formation procedures require the appointment of at least one director, the option to appoint a nominee director for a Hong Kong company is preferred by those who want to keep their true identity confidential.
A nominee director can take the place of another person, investor or of a financial institution. In some cases, another company in Hong Kong can be appointed a nominee director. Our company formation agents in Hong Kong can help you incorporate a company and appoint its nominee director.
We invite you to watch a video about using nominee directors in Hong Kong:
Appointing a nominee director in Hong Kong
A nominee director in Hong Kong is appointed by the company owner via a specific document that guarantees the fact that the nominee will act only upon the instructions received from the beneficial owners. The transfer of power is made between the two directors, and the nominee hands back the control of the company to the real owner through a general power of attorney. Nominees are usually appointed using a separate agreement.
In order to use a nominee director several agreements and documents are prepared beforehand:
- the nominee director statement: this is a service agreement between the beneficial owner and the new nominee, stating the fact that the appointed individual agrees to represent the company and acting on behalf of and under the instructions of the beneficial owner;
- the power of attorney: this is a legal document through which the actual transfer of power of accomplished; it states the clear rights: the right to perform transactions, open bank accounts, perform management activities, etc.;
- a resignation letter: signed by the nominee director but undated; it is used to re-transfer the rights in case the nominee services are no longer needed;
- the declaration of trust: essentially a confidentiality agreement between the individual acting as the nominee and the beneficial owner through which the latter ensures that his identity is not exposed when performing the Hong Kong company registration.
In most cases, the nominee director will not need to own shares in the company. However, if the situation shall arise, he or she must be able to secure the ownership of shares in a limited amount of time. Our Hong Kong company formation representatives can help you with this issue if the case should arise and help you prepare any document for the appointment of the nominee director.
The duties of a Hong Kong nominee director
The nominee should represent the beneficial owner’s best interests. In most cases, a nominee director or shareholder in Hong Kong will perform only those activities he or she has been instructed or empowered to do. Nominee directors in Hong Kong will make any necessary business transactions, manage the various business issues, open bank accounts and operate them, enter into agreements, collect debts or rents and others.
Nominee directors in Hong Kong offer the option of a certain degree of privacy but the purpose is not to avoid showing the identity of the owner to governmental authorities. This is not the equivalent of avoiding liability and it is merely used to hide the identity of the company’s owner from the public records.
You may choose to appoint a nominee director or a nominee shareholder after a discussion with one of our company formation agents in Hong Kong.
Call us now at + 852 8191 3385 to set up an appointment with our company formation experts in Hong Kong. As a DM Advisory client, you will benefit from the joint expertise of local lawyers and consultants for opening an offshore company in Hong Kong.
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