Abolition of Par Value of Shares
The new Companies Ordinance (Cap. 622) ("the new CO") adopts a mandatory system of no-par for all local companies with a share capital and retires the par value of shares, in line with international trends and to provide companies with greater flexibilities in structuring their share capital.
Par value (also known as "nominal value") is the minimum price at which shares can generally be issued. Before the implementation of the new CO, companies incorporated in Hong Kong and having a share capital are required to have a par value ascribed to their shares. The Administration has legislated for the migration to mandatory no-par. Relevant concepts such as nominal value, share premium, and requirement for authorised capital are no longer necessary and are abolished.
The "no-par" regime has become effective upon commencement of the new CO on 3 March 2014. The migration to no-par shares applies to all local companies.
(The new CO and the subsidiary legislation have commenced operation on 3 March 2014)
The new Companies Ordinance (Cap. 622) ("the new CO") adopts a mandatory system of no-par for all local companies with a share capital and retires the par value of shares, in line with international trends and to provide companies with greater flexibilities in structuring their share capital.
Par value (also known as "nominal value") is the minimum price at which shares can generally be issued. Before the implementation of the new CO, companies incorporated in Hong Kong and having a share capital are required to have a par value ascribed to their shares. The Administration has legislated for the migration to mandatory no-par. Relevant concepts such as nominal value, share premium, and requirement for authorised capital are no longer necessary and are abolished.
The "no-par" regime has become effective upon commencement of the new CO on 3 March 2014. The migration to no-par shares applies to all local companies.
(The new CO and the subsidiary legislation have commenced operation on 3 March 2014)
