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20 Jul 2022

A guide to restructuring and insolvency issues and procedures in Hong Kong

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Insolvency regime

Sources

Hong Kong’s insolvency regime is based mainly on that of the United Kingdom. The legislation concerning corporate insolvency is contained largely in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32) (“CWUMPO”) and the Companies (Winding-up) Rules. The corporate insolvency and winding up provisions in the legislation are broadly based on the Companies Act 1929 and the Companies Act 1948 of the UK. The last major amendment of those provisions was made in 2016.

Insolvency procedures 

Corporate insolvency procedures available include: 

  • contractual arrangement 
  • schemes of arrangement 
  • creditors’ voluntary liquidation 
  • compulsory liquidation
  • court liquidation under a regulating order 
  • receivership. 

In addition to the above insolvency procedures, solvent or defunct companies may be disposed by way of: 

  • members’ voluntary liquidation 
  • striking off or deregistration. 

Finally, a dormant company can obtain official dormant status.

Insolvency practitioners 

There are presently no specific licensing or registration requirements for insolvency practitioners. In practice, insolvency practitioners are mostly from the accountancy profession.

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