Certificate of Incumbency and Bank Opening
Most people seek to open a corporate bank account when they first open a company in Hong Kong and banks will always ask for supporting documents of your company to go through the first stage of screening. Aside from your bank statements, invoices, and expense receipts from the last three months, banks will also ask for company documents such as the articles of association, incorporation form (NNC1), business registration certificate as well as certificate of incorporation. But did you know that there is a particular document that people often neglect and may have never even heard about called the certificate of incumbency? This article will talk about the purposes and importance of the certificate and most importantly, how it can help you secure a bank account.
Certificate of Incumbency
The certificate of incumbency is a legal document that is not issued by the Hong Kong government. Since the document is not issued by an official body, it is normally issued by a third party such as service providers, lawyers, or certified public accountants although they are not legally bound to produce such document. The certificate of incumbency is often endorsed by a professional (company secretary) to ensure the legitimacy of the company.
However, not every company formation agency has sufficient knowledge on the subject let alone having the capacity to produce such a document so we highly recommend you to check with your service provider in advance to ensure they do provide such service. Cheap Incorporation is dedicated to assisting our customers in preparing all kinds of company documents with professionalism. Even though the certificate of incumbency is not included in our company formation package, we can still deliver the document at a reasonable price with satisfaction guaranteed.
The document shows the basic information of the company such as the name of the company, the identity of the director and shareholder (ultimate beneficial owner), company secretary, incorporation date, registered office address, share capital, number of shares, and its form of currency, etc. The company members’ identities are therefore verified and confirm their authority to act on the organization’s behalf. Additionally, the document must be certified by a chartered company secretary in order to be effective. Furthermore, if you want to apostille the document, it must then be notarized by a lawyer before submitting it to the Hong Kong High Court for apostille.
When Do You Need a Certificate of Incumbency?
As mentioned above, most people need to have a certificate of incumbency when they are looking to open a corporate bank account overseas. Foreign banks mostly want to see whether the document can verify yourself with legal authority on behalf of your Hong Kong business, and that you are lawfully allowed to carry out such legally binding transactions.
Other scenarios where you need such a document would be applying for loans, visas, or public subsidies. Oftentimes, it would be easier for one to secure a corporate bank account when their certificate of incumbency is endorsed by a professional third party.
The Hong Kong Companies Registry also issues something similar to the certificate of incumbency, which is called the company particular search report, except the document does not include up-to-date information such as the company shareholders or ultimate beneficial owners. You can even download certified true copies of the document from the official website.
Bank Account Opening
In terms of bank account opening, other than the certificate of incumbency, banks also require applicants to provide regular company documents (articles of association, business registration certificate, incorporation form, and certificate of incorporation). The certificate of incumbency is not difficult to prepare since there isn’t a standardized format or wording as to how the document should look like, yet many service providers in Hong Kong lack the knowledge and experience to do so. There’s an increase in demand especially in recent years because many people often require it to open a bank account. Service providers in Hong Kong should take note and step up their game in terms of better preparing such documents.
Many of our customers (mostly entrepreneurs) will sign up for an account with neobanks like Airwallex and Payoneer to start with. These organizations often require you to provide supporting documents such as bank statements, invoices, and expense receipts as proof of legitimacy as well as information like a valid website, targeted countries (to make sure there are no sanctioned countries involved), business nature, products/services etc. Hence, it is recommended that you have sufficient information about your company before you open a bank account, whether it is a neobank or a traditional bank.
As a company formation agency, we can assist you in incorporating a company for a reasonable. Please feel free to contact us via email at info@cheapincorp.com or via email at +852 5404 0902.