英文證券卷二 HKSI Paper 2 第一章

Hong Kong’s status as an international financial centre is reflected in the wide range of financial products and services available in Hong Kong, developed to meet demands for investment, capital and income formation and capital raising, the facilitation of cash and capital flows, capital and investment protection (for example, hedging), safe custody and security, speculation and insurance. The financial markets also provide an avenue for price discovery and liquidity of investments.

Globalisation and advances in technology have enabled investors to move rapidly from one market to another, arbitraging between markets, products and transactions.

The demands for employment is not a function satisfied by financial market alone, thus is not a primary reason for the existence of the financial markets in Hong Kong.

Hong Kong Financial Regulatory Regime is able to address new and complex financial products.

An expression used by the SFC to explain its approach to regulation is that it is “risk-based”. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

An expression used by the SFC to explain its approach to regulation is that it is “risk-based”. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

An expression used by the SFC to explain its approach to regulation is that it is “risk-based”. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

An expression used by the SFC to explain its approach to regulation is that it is “risk-based”. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

The SFC was created by law under the Securities and Futures Commission Ordinance (now repealed and subsumed in the SFO). It is independent, meaning that it is not part of the Government machinery of the Civil Service or the ministerial system. Nevertheless, it reports to and is accountable to the Government as described in section 2 above.

An expression used by the SFC to explain its approach to regulation is that it is “risk-based”. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

Sanction Based regulations and Income Based regulations do not exist in Hong Kong. Merit Based regulations is to reduce access to unfavourable investment products or projects by investors. The interest of investors are protected by doing so. Disclosure Based regulations require investment products and projects disclose their strengths and weaknesses maximally, so that investors can make an informed decision.

The SFC was created by law under the Securities and Futures Commission Ordinance (now repealed and subsumed in the SFO). It is independent, meaning that it is not part of the
Government machinery of the Civil Service or the ministerial system. Nevertheless, it reports to and is accountable to the Government as described in section 2 above. It is considered the securities and futures market prime regulator.

SFC adopts a“risk-based”approach towards regulations. This basically means that regulation is weighted towards the areas that pose the greatest risk to the markets and the participants.

The broad points stated by the Securities Review Committee under Ian Hay Davison were
the need for:
(e) checks and balances on the system, with the exchanges being supervised by a
commission independent of the Government, with the Government only to intervene if
and when the Commission failed to regulate properly

The definition of asset management is to manage securities and futures portfolio or real estate investment trust for others. Auditors do not manage asset; they merely audit as their primary business. Fund managers manage Collective Investment Schemes; that is managing portfolios of securities and futures or real estate trust for a group of people. Therefore they are service providers in the asset management industry. Stockbrokers buy and sell Collective Investments Schemes on behalf of clients and may also manage securities portfolio for clients. Therefore they are service providers in the asset management industry. Independent Financial Advisers (IFA) provides advice on buying and selling Collective Investment Schemes. Therefore they are service providers of the asset management industry.

Typical service providers include:
(d) banks; (e.) trustees; (f) custodians; (g) financial planners

Typical service providers include:
(a) fund houses; (b) fund management companies; (c.) stockbrokers

Financial Intermediaries must be compensated in a financial transaction to be view as providing financial services. Setting up a tutorial company is not providing financial services to a third party because it is not a financial transaction. Managing assets for free is not a financial service since it is not compensated. Signing a rental agreement on behalf of a bank is not a financial service because rental agreement itself is not a financial instrument. Providing loans to others with interest is a form of financial service since it is a service in exchange for compensation in a financial transaction.

All of these services are provided by Hong Kong financial companies.

This service is not provided by any Hong Kong financial actor.

Providing a loan and charging interest is a financial actitiy that is subjected to supervision by the financial regulators.

To conclude this initial definition section, the categories of persons conducting Type 1 regulated activity include:
(a) a participant of the SEHK, whether it engages in activities on the SEHK or outside it;
(b) another securities dealer carrying out dealing in securities in Hong Kong;
(c.) a licensed representative of the above;
(d) an AFI registered with the SFC for this activity (and its staff who deal with the public and are on a register maintained by the HKMA as engaged in such activity);
(e.) a portfolio manager who is licensed (as a securities dealer) for Type 1 regulated activity; and
(f) a securities introducing agent (see section 8.13 below).

Institutional investors are actors but not providers.

Common consequences of deficit in corporate governance standards:
I. Insider trading and other forms of market misconduct
II. Misfeasance, fraud, and misconduct by directors, managers, and other staff causing losses to the company or shareholders
IV. The price of the connected transaction deviates from the market price, causing losses to the company and shareholders

The functions of the SFC in relation to asset management are two-pronged:
(a) it authorises CISs, including, for example, unit trusts, managed funds and retirement schemes, and supervises the marketing of these CISs; and
(b) it licenses and supervises intermediaries engaged in asset management (Type 9 regulated activity) as well as others engaged in providing advisory services in the industry (Type 4 and Type 5 regulated activities); if they choose to be licensed as dealing in securities and/or futures contracts (Type 1 and/or Type 2 regulated activities), the respective regulatory regime will be applied to them.
The first of these functions is derived from Part IV, SFO and the second from Part V, SFO.

The functions of the SFC in relation to asset management are two-pronged: One of those functions is to authorise CISs, including, for example, unit trusts, managed funds and retirement
schemes, and supervises the marketing of these CISs.

Powers granted to the SFC include the power to authorise CISs and structured products for offer to the public as well as advertisements and other documents that contain an offer to the public.

In furtherance of these aims, the SFC conducts regular inspections of licensed corporations which may be conducted either on-site or via a request for information to be provided. The maintenance of proper documentation is critical in this regard.

Certain jurisdictions are deemed to have rules governing the operations of CISs which are comparable with those in Hong Kong; schemes domiciled in such jurisdictions are RJSs.
In order to facilitate compliance with applicable legal and regulatory requirements (in Hong Kong and, where applicable, in overseas jurisdictions), there is a growing tendency, particularly among larger asset managers, to adopt a detailed compliance manual which sets out the asset manager’s policies and procedures in relation to matters of regulatory concern.

In order to facilitate compliance with applicable legal and regulatory requirements (in Hong Kong and, where applicable, in overseas jurisdictions), there is a growing tendency to adopt a detailed compliance manual which sets out the securities dealer’s or adviser’s policies and procedures in relation to matters of regulatory concern. In many cases, a dedicated compliance officer is engaged to oversee adherence to the manual, maintain close contact with the regulators and keep abreast of regulatory developments affecting the securities dealer’s or adviser’s business.

Senior management must provide the leadership and drive to promote, encourage and enforce, if necessary, good compliance practices. It must establish:
(a) good line and reporting structures;
(b) clearly defined functions and responsibilities;
(c.) effective communications;
(d) appropriate transparency and disclosure practices.

Corporate governance has been defined in various ways. It can be seen as primarily concerned with the proper relationship between a company’s management, its board and its shareholders, and possibly also its stakeholders (i.e. groups who have a stake in the healthy existence of a corporation, such as employees, creditors and customers).

Good Corporate governance are not required to be responsible for the interest of Former Employees.

Corporate governance has been defined in various ways. It can be seen as primarily concerned with the proper relationship between a company’s management, its board and its shareholders, and possibly also its stakeholders (i.e. groups who have a stake in the healthy existence of a corporation, such as employees, creditors and customers). The governance issue is therefore also concerned with the system by which companies are directed and controlled.
The activities of intermediaries frequently concern listed corporations. Accordingly, in addition to considering their own regulatory and corporate governance position, intermediaries need to be aware of the wider impact of corporate governance on their clients and the market. It is now generally accepted that investors attach considerable importance to corporate governance when assessing the value of a stock, and that markets which exhibit a higher degree of good corporate governance are regarded as more competitive in the international arena.

Corporate governance has been defined in various ways. It can be seen as primarily concerned with the proper relationship between a company’s management, its board and its shareholders, and possibly also its stakeholders (i.e. groups who have a stake in the healthy existence of a corporation, such as employees, creditors and customers).

A good corporate-governance is not related to former employees.

The Organisation for Economic Co-operation and Development (“OECD”) has issued a set of core principles of corporate governance practices to include fairness, transparency, accountability and responsibility. Leadership is not one of those principles.

Having regard to the general concepts set out by the OECD, some of the ways a company may improve its governance are as follows:
(a) installing appropriate checks and balances, such as separating the functions of the chairman and chief executive officer, appointment of independent non-executive directors, establishment of independent audit committees, and setting up committees to control the remuneration and benefits of directors and senior management;
(b) increasing transparency and disclosure to shareholders, stakeholders and the public;
(d) installing strong protective structures for minority shareholders, creditors and other lenders

A key objective of good governance in any corporate business is to avoid management taking improper advantage of its position to benefit itself in preference to the legitimate interests of the company.

The essence of corporate governance is to enhance transparency and check and balance. The powers of the management should be limited, therefore, installation of check and balances and limiting the management’s remuneration are good practices.

Disclosure requiremetns are in place to enhance transperancy

It’s not required to protect the interests of the management.

Decisions made by the regulators can be overturned or overruled.

Incompatible duties and functions should be segregated, particularly those which, when performed by the same person, may provide opportunities for abuse or result in the overlooking of errors, thereby exposing the intermediary and its clients to risks.

Good corporate governance should separate the functions of Chairman and CEO.

A key objective of good governance in any corporate business is to avoid management taking improper advantage of its position to benefit itself in preference to the legitimate interests of the company. Having regard to the general concepts set out by the OECD, some of the ways a company may improve its governance are as follows:
(a) installing appropriate checks and balances.
(b) increasing transparency and disclosure to shareholders, stakeholders and the public;
(c) installing strong protective structures for minority shareholders, creditors and other lenders.
(d) identifying and penalising corporate wrongdoing.

A key objective of good governance in any corporate business is to avoid management taking improper advantage of its position to benefit itself in preference to the legitimate interests of the company. Having regard to the general concepts set out by the OECD, some of the ways a company may improve its governance are as follows:
(a) installing appropriate checks and balances.
(b) increasing transparency and disclosure to shareholders, stakeholders and the public;
(c) adopting international accounting and auditing standards;
(d) installing strong protective structures for minority shareholders, creditors and other lenders.

A key objective of good governance in any corporate business is to avoid management taking improper advantage of its position to benefit itself in preference to the legitimate interests of the company. Having regard to the general concepts set out by the OECD, some of the ways a company may improve its governance are as follows:
(a) installing appropriate checks and balances, such as separating the functions of Chairman and CEO; appointment of independent non-executive directors; establishment of independent audit committees; setting up committees to control the remuneration and benefits of directors and senior management.

The Organisation for Economic Co-operation and Development offers the concept that companies can improve the level of corporate governance by the following methods:
I. Distinguish between the Chief Executive Officer and the Chairman
II. Enhance transparency disclosure to shareholders and stakeholders
III. Establish a compensation committee to monitor senior management compensation
IV. Establish a strong protection structure for minority shareholders, creditors, or other stakeholders
V. Establish an independent audit committee
VI. Identify business misconduct
VII. Adopt international accounting and auditing standards

The SFC may enquire into or investigate suspected breaches of the SFO and any subsidiary legislation, codes and guidelines:
(a) Breaches of the SFO and subsidiary legislation are legal offences and will be investigated by the SFC and enforcement action taken; the SFC may refer serious cases to law enforcement agencies such as the Commercial Crimes Bureau (“CCB”) of the Hong Kong Police Force or the Independent Commission Against Corruption (“ICAC”) for investigation and action.
(b) The SFC may also apply to the courts for an injunction to restrain a person from dealing with his assets, or from carrying on all or a part of his business, if it can make a case to show that it is in the public interest to issue such an order.

The SFC can conduct supervisory inspections on an intermediary or an associated entity of an intermediary.

The SFC may authorise an employee (or another person with the consent of the Financial Secretary) to carry out an investigation. The person so authorised may investigate any person. A person under investigation is required to:
(a) provide documents and explanations;
(e.) make a statutory declaration that he is unable to provide the evidence for reasons to be stated, if such is the case.
The SFC may apply to the court to order a person who does not comply with requirements made by the authorised person or investigator under relevant provisions to do so (s. 185, SFO).

Section 183, SFO requires the person under investigation to:
(a) provide documents and explanations;
(b) attend before the investigator at the time and place the investigator requires in writing and to answer questions;
(d) substantiate his answers, explanations or statements by making a statutory declaration

There are a number of grounds under which the SFC may carry out an enquiry into a listed company. It has powers to obtain records and documents, explanations and statements on
oath as to why, if such is the case, the information cannot be produced.
The persons who may be subject to the enquiry include:
(e.) any person.

A person commits an offence if he provides to the SFC (whether in applications or in other circumstances) false or misleading information as to a material particular knowingly or recklessly as to whether it is false or misleading (ss. 383 and 384, SFO).

An employee of the SFC, an authorised person or an investigator may, in appropriate circumstances, apply to a magistrate for the issue of a warrant:
(a) authorising specified persons, a police officer and such other persons as may be necessary to assist in the execution of the warrant to enter specified premises, if necessary by force, at any time within seven days;
(b) requiring any person on the premises to produce any relevant documents;
© prohibiting any person to erase or alter or remove any relevant documents; and
(d) authorising the specified persons to:
(i) search for, seize and remove any relevant documents

Six months is the longest period permitted for an order to retain documents established by a regular warrant. Any period beyond that must be requested.

The Financial Secretary shall amend by the Gazette what is a regulated activity.

Ordinances are statutory, rules and guidelines are enforced.
Codes do not have the force of law in Hong Kong but only in other countries.

Powers are given to the Financial Secretary to prescribe, by notice in the Gazette:
(a) new financial products as being (or not being) securities or futures contracts, and new financial arrangements as CISs, thus capturing new products in the regulatory net as appropriate (ss. 392 and 393, SFO)

The SFO is the principal legislative document governing the securities market in Hong Kong.

The SFC has made the Accounts and Audit Rules specifying the form and contents of financial statements and other documents that licensed corporations and associated entities of intermediaries (both licensed corporations and registered institutions) should prepare and the content of auditors’ reports.

Part VII empowers the SFC to make subsidiary legislation (s. 168, SFO) and/or codes (s. 169, SFO).

These are some of the Major Subsidiary Legislation:
1.1 Securities and Futures (Financial Resources) Rules
1.2 Securities and Futures (Client Securities) Rules
1.3 Securities and Futures (Client Money) Rules
1.4 Securities and Futures (Keeping of Records) Rules
1.5 Securities and Futures (Contract Notes, Statements of Account and Receipts) Rules
1.6 Securities and Futures (Accounts and Audit) Rules,
plus many others.

The SFO also empowers the SFC to issue codes, guidelines and guidance notes. These do not have the force of law and do not override the provisions of any applicable law. However, a
failure to follow the spirit of the codes, guidelines and guidance notes may reflect adversely on the fitness and properness of licensed or registered persons to continue to be so licensed or
registered.

Codes and guidelines do not have the force of law and are not legally enforceable. However, the SFC is able to penalise licensed or registered persons breaching the codes and guidelines by applying the blanket principle that a breach of these may impugn the licensed or registered person’s fitness and properness to remain licensed or registered.

The FMCC applies to intermediaries conducting discretionary management of CISs (whether or not the CISs are authorised by the SFC) and their representatives (“Fund Managers”).

Part XVI gathers together a number of provisions of common application as well as regulatory powers. It includes miscellaneous provisions that do not fit elsewhere and additional ones which relate to the increase in civil law applications.

Option I included in the question is not a real code, the other three do exist and apply to asset managers.

The SFC may enquire into or investigate suspected breaches of the SFO and any subsidiary legislation, codes and guidelines:
(d) Codes and guidelines do not have the force of law and are not legally enforceable.
However, the SFC is able to penalise licensed or registered persons breaching the codes and guidelines by applying the blanket principle that a breach of these may impugn the licensed or registered person’s fitness and properness to remain licensed or registered.

The SFC may enquire into or investigate suspected breaches of the SFO and any subsidiary legislation, codes and guidelines: (d) Codes and guidelines do not have the force of law and are not legally enforceable.
However, the SFC is able to penalise licensed or registered persons breaching the codes and guidelines by applying the blanket principle that a breach of these may impugn the licensed or registered person’s fitness and properness to remain licensed or registered.

The principal ordinances applicable to the asset management industry are the SFO, the Mandatory Provident Fund Schemes Ordinance (“MPFSO”), the Occupational Retirement
Schemes Ordinance (“ORSO”), the Insurance Ordinance and, to a lesser extent, the Banking Ordinance, the Employment Ordinance, the Inland Revenue Ordinance and the Trustee
Ordinance.

The HKMA is required to maintain currency stability, ensure the safety and stability of the banking system, and promote the efficiency, integrity and development of the financial system.

The SFO grants the SFC powers to make detailed
rules relating to:
(a) their financial resources;
(b) the handling of client money and other client assets;
© the keeping of accounts and records; and
(d) auditing matters.

The SFC may enquire into or investigate suspected breaches of the SFO and any subsidiary legislation, codes and guidelines:
(c) Persons prejudiced by the perpetration of market misconduct may take civil action against the wrongdoer through the courts to obtain redress. The SFO has provisions for the findings of the Market Misconduct Tribunal to be admissible in evidence in private civil actions.
(d) Codes and guidelines do not have the force of law and are not legally enforceable. However, the SFC is able to penalise licensed or registered persons breaching the codes and guidelines by applying the blanket principle that a breach of these may impugn the licensed or registered person’s fitness and properness to remain licensed or registered.

These are the three ways for a liquidation to happen, according to the NCO:
1. A compulsory winding-up ordered by the court, and the liquidator is appointed by the court and acts under its control. A voluntary winding-up may be started by members or creditors. There are fewer formalities than with a compulsory liquidation and this route is far more popular.
2. Members’ voluntary winding-up (s. 233, CWUMPO)
This may be undertaken if the directors or, in the case of a company having more than two directors, the majority of the directors issue a “certificate of solvency” to the effect that they
have:
(a) made a full enquiry into the affairs of the company; and
(b) formed the opinion that the company will be able to pay its debts within 12 months from the commencement of the winding-up as specified in the certificate of solvency.
3. Creditors’ voluntary winding-up (ss. 241 to 243, CWUMPO)
The company shall arrange a meeting of the creditors to be summoned for the day when the resolution to wind up is proposed or for the next day. Advertisements must be run in the
Gazette and newspapers. A statement of the position of the company’s affairs, and a list of creditors and amounts due, will be presented to the meeting, at which a liquidator and a committee of inspection will be appointed to supervise the process.

Model articles of association for private companies, public companies and guarantee companies are provided in the Companies (Model Articles) Notice. Model articles of private companies and public companies consist broadly of four parts including matters relating to:
(a) officers, including powers, duties, appointments and disqualifications of directors, appointments and removal of company secretaries;
(b) members, including meetings and voting procedures;
© capital, such as share capital, rights and dealings with shares and dividends; and
(d) miscellaneous provisions such as communications to and by the company and administrative arrangements.

Model articles of association for private companies, public companies and guarantee companies are provided in the Companies (Model Articles) Notice. Model articles of private companies and public companies consist broadly of four parts including matters relating to:
(a) officers, including powers, duties, appointments and disqualifications of directors, appointments and removal of company secretaries;
(b) members, including meetings and voting procedures;
© capital, such as share capital, rights and dealings with shares and dividends; and
(d) miscellaneous provisions such as communications to and by the company and administrative arrangements.

Members cannot pass a resolution at a general meeting to limit the powers of a director unless the director is unwilling to act or the director is in breach of fiduciary duty.

Model articles of association for private companies, public companies and guarantee companies are provided in the Companies (Model Articles) Notice. Model articles of private
companies and public companies consist broadly of four parts including matters relating to:
(a) officers, including powers, duties, appointments and disqualifications of directors, appointments and removal of company secretaries;
(b) members, including meetings and voting procedures;
© capital, such as share capital, rights and dealings with shares and dividends; and
(d) miscellaneous provisions such as communications to and by the company and administrative arrangements.

Company meetings of shareholders are very important as they provide the only opportunity for shareholders to exercise any control over the affairs of the company or take part in its operations.

Which of the following can call a meeting other than the annual general meetings?
I. Shareholders
II. Directors
III. Court

Other general meetings may be requested by directors, shareholders and the court.

The business of an annual general meeting includes the consideration of the annual accounts, the declaration of dividends, the election of directors to replace retiring ones, and the appointment of auditors.

A company is required to hold its first AGM within 18 months after its incorporation. Subsequent AGMs must be held every calendar year and the interval between AGMs should not be more than 15 months.

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy).

A company is required to hold its first AGM within 18 months after its incorporation. Subsequent AGMs must be held every calendar year and the interval between AGMs should not be more than 15 months.

A company is required by the NCO to hold an annual general meeting of shareholders (s. 610, NCO). Companies are permitted to dispense with the requirement to hold annual general meetings by passing a written resolution or a resolution at a general meeting with unanimous shareholders’ consent.

The usual audit report does not give much opportunity for questions as it is normally in a standard format stating that the accounts present a “true and fair view” of the company’s financial position, unless something is seriously wrong, when the auditors will include a qualification in the report.

Under s. 548, NCO, resolutions may be passed by circularisation and signed by all members except for:
(a) the removal of auditors before the expiration of their term of office; or
(b) the removal of a director before his term expires.

Under s. 548, NCO, resolutions may be passed by circularisation and signed by all members except for:
(b) the removal of a director before his term expires.
A special resolution is one passed by at least 75% of members at a general meeting (voting in
person or, where proxies are allowed, by proxy), of which not less than 21 days’ notice
specifying the intention to pass the resolution has been given. Examples of matters which need
special resolutions are:
(a) reduction of share capital;
(c.) alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in the articles of association (for existing companies).

The issuance of new shares are passed by the board of directors.

Under s. 548, NCO, resolutions may be passed by circularisation and signed by all members.

Under s. 548, NCO, resolutions may be passed by circularisation and signed by all members except for:
(b) the removal of a director before his term expires.

Under s.548, NCO, resolutions may be passed by circulation and signed by all members.

Special resolutions should have a 14-day notice period.

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy), of which not less than 14 days’ notice
specifying the intention to pass the resolution has been given.

Examples of matters which need special resolutions are:
(a) reduction of share capital;
(b) winding up of the company voluntarily or by court; and
(c) alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in the articles of association (for existing companies).

Examples of matters which need special resolutions are:
(a) reduction of share capital;
(b) winding up of the company voluntarily or by court; and
(c) alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in the articles of association (for existing companies).

Examples of matters which need special resolutions are:
(a) reduction of share capital;
(b) winding up of the company voluntarily or by court; and
(c) alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in the articles of association (for existing companies).

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy).

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy), of which not less than 14 days’ notice specifying the intention to pass the resolution has been given.

Examples of matters which need special resolutions are:
(a) reduction of share capital;
(b) winding up of the company voluntarily or by court; and
© alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in
the articles of association (for existing companies).

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy), of which not less than 14 days’ notice specifying the intention to pass the resolution has been given. Examples of matters which need special resolutions are:
(a) reduction of share capital;
(b) winding up of the company voluntarily or by court; and
© alteration of objects, articles of association (for companies formed and registered under the NCO) and conditions in memoranda of association that could have been included in the articles of association (for existing companies).
A copy of a special resolution must be lodged with the Registrar of Companies within 15 days of it being passed.

A copy of a special resolution must be lodged with the Registrar of Companies within 15 days of it being passed.

A special resolution is one passed by at least 75% of members at a general meeting (voting in person or, where proxies are allowed, by proxy), of which not less than 14 days’ notice
specifying the intention to pass the resolution has been given.

Removal of auditors and directors can be done by ordinary resolution.

Reduction of share capital, liquidation, amendment of articles of association all require special resolutions.

An ordinary resolution is a resolution which may be passed by a simple majority of those present and voting at a meeting of members. Notice must be given.

An ordinary resolution is a resolution which may be passed by a simple majority of those present and voting at a meeting of members. Notice must be given.

These include:
(a) changes to articles of association and company name;
© issue of shares at a discount;
(d) alteration of capital including reduction.

These include:
(h) removal of directors;
(i) disposal of company assets;
(j) approval of payments for loss of office

The NCO permits the formation of a company by one or more persons (s. 67, NCO). The NCO also provides that one member
constitutes a quorum for a meeting of a company having only one member.

There are provisions in the NCO and in Companies (Model Articles) Notice which enable a
company to vary the rights of the holders of a class of shares. However, if a variation is being processed, the holders of at least 10% of the total voting rights of the shares in that class may petition the court to have the variation cancelled if it is against their interests.

The court will not generally interfere in internal management matters or where the company can deal with the matter by calling a meeting. This is the principle of majority power.

The court will not generally interfere in internal management matters or where the company can deal with the matter by calling a meeting. This is the principle of majority power.

To ensure that this principle is not abused, certain safeguards are provided under the NCO to protect the interests of minority shareholders:
(c.) Dissenting members may appeal to the court to have certain resolutions cancelled.
(e.) 100 members or 10% of the holders of the issued shares may ask the Financial Secretary to appoint an investigator into the company’s affairs.
On the other hand,
(d) Members with 5% of the paid-up capital which carries voting rights may request the directors to call a meeting; if the directors will not, the members may do so.
Sharon cannot call a meeting on her own.

To ensure that this principle is not abused, certain safeguards are provided under the NCO to protect the interests of minority shareholders:
(a) As seen in section 3.17 above, a special resolution is required for certain matters.
(b) Court sanction is required where the decision of the company will directly affect creditors.
© Dissenting members may appeal to the court to have certain resolutions cancelled.
(g) A member may petition for a winding up.

A member may apply to the court for an order if he considers that the affairs of the company are being conducted in a manner prejudicial to the interests of the members generally or of some part of the members.

Dissenting members may appeal to the court to have certain resolutions cancelled.

When the rights of the shareholders are changed, as long as there are more than 10% of the voting rights, a petition can be filed with the court to cancel the change.

To ensure that this principle is not abused, certain safeguards are provided under the NCO to protect the interests of minority shareholders:
(c.) Dissenting members may appeal to the court to have certain resolutions cancelled.
(d) Members with 5% of the paid-up capital which carries voting rights may request the directors to call a meeting; if the directors will not, the members may do so.
(e.) 100 members or 10% of the holders of the issued shares may ask the Financial Secretary to appoint an investigator into the company’s affairs.

To ensure that this principle is not abused, certain safeguards are provided under the NCO to protect the interests of minority shareholders:
(c.) Dissenting members may appeal to the court to have certain resolutions cancelled.
(d) Members with 5% of the paid-up capital which carries voting rights may request the directors to call a meeting; if the directors will not, the members may do so.
(e.) 100 members or 10% of the holders of the issued shares may ask the Financial Secretary to appoint an investigator into the company’s affairs.
(f) A member may apply to the court for an order if he considers that the affairs of the company are being conducted in a manner prejudicial to the interests of the members generally or of some part of the members.

To ensure that this principle is not abused, certain safeguards are provided under the NCO to protect the interests of minority shareholders:
(c.) Dissenting members may appeal to the court to have certain resolutions cancelled.
(d) Members with 5% of the paid-up capital which carries voting rights may request the directors to call a meeting; if the directors will not, the members may do so.
(e.) 100 members or 10% of the holders of the issued shares may ask the Financial Secretary to appoint an investigator into the company’s affairs.
(g) A member may petition for a winding up.

Measures to protect minority shareholders include:
1. Members with 5% of the voting rights may request the directors to call a general meeting. If the directors refuse, they can convene a general meeting on their own.
2. 100 members or 10% of the holder of the issued shares can request the Financial Secretary to investigate the company’s affairs
3. Dissenting members can appeal to the court to revoke certain company resolutions
4. Any member may petition the court for the winding-up of the company.
5. If a member believes that their interests are impaired, they can apply to the court for an order

The court may intervene to allow an individual member or members to bring an action:
(a) to enforce some personal rights (a personal action);
(b) where a right has been infringed which affects all or a number of members in a similar way (a joint action); or
(c) on behalf of the company where misconduct has been committed against the company, for example by a director of the company or a third party (a derivative action).

The NCO merely defines a director as including a person who occupies the position of director, by whatever name he is called. The NCO itself refers very little to directors but there is more about them in Companies (Model Articles) Notice. The NCO says that every company (not being a private company) must have at least two directors (s. 453, NCO) and every private company must have at least one director (s. 454, NCO).

The NCO merely defines a director as including a person who occupies the position of director, by whatever name he is called. The NCO itself refers very little to directors but there is more about them in Companies (Model Articles) Notice. The NCO says that every company (not being a private company) must have at least two directors (s. 453, NCO) and every private company must have at least one director (s. 454, NCO). The directors must be appointed by the members acting in general meeting.

Every private company is required to have at least one director, and at least one director must be a natural person.

Every private company (other than one within the same group as a listed company) is required to have at least one director who is a natural person.

Each private company must have a least one director who is a natural person

Shadow directors are “persons in accordance with whose directions or instructions (excluding advice given in a professional capacity) the directors, or a majority of the directors, of a body corporate are accustomed to act”.

Shadow directors are “persons in accordance with whose directions or instructions (excluding advice given in a professional capacity) the directors, or a majority of the directors, of a body corporate are accustomed to act”.

An officer, according to the NCO, includes a director, manager or company secretary.