Exit Strategy

A company or an individual may want to withdraw -- at its best, to achieve an objective worth more than the cost of any further involvement; or at its worst, to save cost and prevent more serious obligation. In Hong Kong, company may become dormant to suspend; deregister or wind-up to exit.

Dormant – The company can suspend its business and re-activated upon new accounting transactions occur or the board’s desire. When the board has 75% vote passed to let the company dormant with a special resolution submitted to the Registries, the company becomes dormant. During the dormant period, the company can cease conducting annual audit, submitting annual return and holding annual general meeting so time and costs are saved; whilst its company name is still being kept registered.

Deregistration – This is a formal quit and dissolve the company. When the company has no outstanding liabilities, no immovable assets, no unsettled tax matters, and not a party to any legal proceedings. It can apply for deregistration with the conditions that all its members agree to the deregistration, it has not commenced operation or business, or has ceased its business activities during the previous 3 months immediately before the application, with an audited account up to the date of business cessation. Deregistration is a relatively simple, inexpensive and quick way to dissolve a defunct solvent company.

Winding Up (Voluntary) – In case the company did not meet the requirements of applying deregistration, and its members preferred to dissolve the company, a voluntary winding up is a last choice. In this case, the procedure becomes more complex and is more time-consumed in order to clear all liabilities with past and current members, directors and any other creditors, etc, hence one or more liquidators for the purpose of winding up the affairs and distributing the assets of the company shall be appointed by the company.  

An exit from current business is never an easy decision even a buyer has proposed an attractive price to you. Our team is always willing to hear your concerns and offer you on:
•    Advising the exit strategy which best suitable for your company
•    Supporting and assisting you all the way to exit
•    Preparing all relevant documents such as board resolution, declaration, forms, sales agreements etc.
•    Submitting the application to the Registries and Inland Revenue Department where applicable