Shareholders usually are not familiar with the related formalities when planning to terminate the company, so this may possibly result in the breach of relevant laws due to ignorance, and if the infractions are severe, they could lead to arrest or impact future exit and entry of Hong Kong.

Under Section 291 of the Companies Ordinance (Cap. 32) of the Laws of Hong Kong, a company applying for deregistration with Companies Registry must meet the following conditions:

• Consent by all shareholders;
• The company has not commenced operation or business, or has ceased operation or business at least 3 months before the application of deregistration;
• No outstanding indebtedness, including governmental license fee and tax;
• The company is not a party to any legal proceedings;
• The company has no immovable property situate in Hong Kong;
• If the company is a holding company, none of its subsidiary’s assets consist of any immovable property situate in Hong Kong
• Obtain the Written Notice of No Objection issued by the Commissioner of Inland Revenue.