Questions regarding duties of exit from a partnership ..

What happened -

I registered a LLC in HK a few months ago with a partner, - the 2 of us are both listed as founder members / directors and each took up half of the registered capital; I also act as cpy secretary. Due to change of plans, I have to exit from the company. There was no business transaction since the formation of the cpy yet and we havent filed annual return (which is due next year).


My question-

If I resign as director & secretary, and withdraw my contribution from the bank a/c (with my partners consent) - do I have any other liability as the founder member? Do I need to file for transfer of shares and pay stamp duty? Or is it ok just to list the updated shareholding structure when my partner (who carries on the biz) files for the 1st annual return? Or is it easier to cancel / forfeit the shares of my part?


Thanks advance for your advice!

[UPDATE] Please note that fee quotes stated in historic postings may be out-of-date.


First it would make sense to get our terminology straight. Firstly there is no such “LLC” designation in Hong Kong: companies can take on a number of different forms, the most common “limits the liability of Shareholders” but it is not a “LLC” under American usage. Secondly a fellow shareholder is not a partner, he/she is a fellow shareholder : partner denotes of “partnership” quite a different business structure to a company incorporated under the Hong Kong Companies Ordinance.


If you resign as director & secretary and withdraw all your contribution from the bank a/c, then, according to section 170(1) of Companies Ordinance, you would not bear any other liability as founder member.


You should sign and register a formal transfer of shares which should be reported in the annual return first made by the company after such a transfer took place. (Cap.32 s.68).


You have to pay stamp duty for transfer of shares (Cap.117 s.4) based on the value of the Company and the consideration paid. A transfer of shares is the easiest exit rule.


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Thanks vm for the clarification!