HKSI Paper 1 Hong Kong law and the Companies Ordinance question: certificate of re-domiciliation from the Hong Kong Registrar

HKSI Paper 1Hong Kong law and the Companies Ordinance

Silverstrand Holdings Ltd, a BVI company, receives a certificate of re-domiciliation from the Hong Kong Registrar. It has a HK$50 million bank loan and is defending a lawsuit in the Court of First Instance. What happens to the loan and the lawsuit?

A Both continue unaffected, because registration does not create a new legal entity
B Both pass to the new company only once the Registrar registers a transfer of its assets
C The lawsuit is stayed until the company proves it has been deregistered in the BVI
D The loan must be novated to the new Hong Kong company within 120 days of the certificate

Show the answer and explanation

Answer: A. Both continue unaffected, because registration does not create a new legal entity

Section 820D(1) of Cap. 622 provides that registration as a re-domiciled company does not create a new legal entity, does not affect the company's identity or continuity, its contracts, or any right, obligation or liability, and does not render legal proceedings defective. Section 820D(2)-(3) confirms that proceedings may be continued by or against the re-domiciled company and that its property remains its own. So no novation is needed: the 120-day period in s.820E is for deregistering in the BVI, not for moving contracts. There is no stay pending deregistration, and no asset transfer to register; s.820D(4) adds that re-domiciliation does not transfer assets for tax purposes either. Source: Companies Ordinance (Cap. 622) ss.820D, 820E (Companies (Amendment) (No. 2) Ordinance 2025, in force 23 May 2025) (as at October 2026).

Common mistake

Candidates picture re-domiciliation as a transfer to a new company; it is the same company continuing under Hong Kong law.

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