The Macau Special Administrative Region, which has recorded a high growth rate since the handover from the Portuguese to the Chinese administration in 1999, has seen economic growth accelerate in recent years, mainly due to the liberalisation of the gaming industry, a mainstay of the local economy. This, together with the fact that the public administration must keep pace with the latest technological advances, led to a demand for the amendment of the Commercial Registry Code, which entered into force on April 23 2012. New changes to the code, introduced by Law 6/2012, aim to:
- improve the identification system for acts involved in the commercial registration of companies; and
- ensure the accuracy, security and accessibility of records by creating a legal basis for the digitisation of commercial registration services.
In addition, a common mechanism for the collection of information between the Commercial and Chattels Registry and the Finance Services Bureau has been established. This is expected to:
- allow common access to information on entrepreneurs and taxpayers;
- achieve greater efficiency in the registration process; and
- open up the possibility of data interconnection between the registry and other public bodies.
The revised Article 25, Paragraph 2 of the code seeks to improve the identification system for acts involved in the commercial registration process by limiting the entitlement to apply for the registration of facts relating to entrepreneurs(1) to the entrepreneurs themselves or their representatives, except for facts regarding their civil status or marital property regime, which can be proven by any appropriate document. The same applies to the revised Article 25, Paragraph 4 concerning the application for validation of minutes books: only the company, the directors, the secretary and authorised persons (such as lawyers, whose power of attorney is assumed) are allowed to apply for validation.
However, Article 25, Paragraph 2 does not apply to companies that are subject to prior authorisation by a public body or institution. Such companies can seek to file for the suspension, revocation or forfeiture of this authorisation.
This restriction on the entitlement to register is reinforced by the demand for several documents in order to improve the identification of stakeholders, such as a copy of identification documents for an entrepreneur, together with the declaration under Article 34, Paragraph 1.(2) In turn, the registration of a company as a legal person also requires a copy of identification documents of the partners or other members, administrators, members of the audit board and company secretary, as per subparagraphs (b), (c) and (d) of the revised Article 35, Paragraph 1. Also, the declaration of compliance by the lawyer confirming the absence of irregularities in the incorporation process, which already had to be included in a particular document, must now be expressly set out in writing with the legal acknowledgement of the members' signatures. Finally, the revised Article 35, Paragraph 4 extends the obligation to deliver these new documents along with an application for registration of acts pertaining to:
- new members whose interest does not consist of shares;
- new members of economic interest groupings; or
- new members of corporate bodies.
In order to keep up with technological developments and the rapid growth of the Macau economy, the revised Article 57 provides for the creation of a folder for each entrepreneur and company, which will hold all related documents. These folders may be archived electronically,(3) and the documents filed therein are granted the same legal status as the original documents.
The new Article 69(a) specifies that requests for certificates or for any written registration information on identification document type and number, as well as for registered facts relating thereto, will be of a public nature. Therefore, such information will be provided only to the entrepreneur and to persons duly mandated for that purpose; or to partners and members of a commercial enterprise, members of corporate bodies and persons duly mandated for that purpose in the case of companies.
The introduction of electronic documents is in turn strengthened by the revised Article 70, which requires not only the digitisation of the Commercial and Chattels Registry, but also its interconnection with other public bodies (including the Finance Services Bureau). Thus, Article 70 now provides that information concerning the legal status of entrepreneurs and companies which is obtained through electronic means of interconnection with the registry has the same legal status as a company's physical registration certificates,(4) provided that the entity which requested the information has done so in the exercise of its respective powers.
The interconnection of services – which is closely linked to the digitisation of records and the ease of use and speed of processing information – necessarily entails the creation of a database, accessible to public authorities. The new Article 4, Paragraph 5 of Decree-Law 56/99/M determines that the storage of information in folders may be done electronically. At the same time, the new Article 118-A provides that the registry and other public services may access and reciprocally exchange updated information relating to entrepreneurs, companies and other relevant data by electronic means, in accordance with the Data Protection Act.(5) These measures, which seek to establish a quicker and more up-to-date information register, are further reinforced by Article 19-A, which specifies that the bureau must communicate relevant facts to the registry through this new electronic medium. This is applicable in case of cancellation of the registration of a company for corporate income tax, or in case a company files a new income tax entry, in which case the registry – on its own initiative – shall proceed to file the facts within the registration of the instrument of incorporation of the company.
The need for these legislative revisions, which were announced over a decade ago, was already urgent given the rapid economic growth of Macau in the first decade of the millennium; it became more so following the liberalisation of the gaming industry in 2002. The increasing digitalisation of public services has further intensified the need to revise the law. In this respect, the legislative amendments, although somewhat overdue, will provide a much-needed modernisation of Macau law. There may be some reservations regarding the use of electronic information by public bodies, so a re-evaluation of the Data Protection Law(6) is advisable, as well as greater scrutiny of the newly established interconnection network.
For further information on this topic please contact Pedro Cortés or José Filipe Salreta at Rato Ling Vong Lei & Cortés Advogados by telephone (+853 2856 2322), fax (+853 2858 0991) or email ([email protected] or [email protected]).
(1) Listed in Article 3 of the Commercial Registry Code.
(2) Cf revised Article 34, Paragraph 2 of the Commercial Registry Code.
(3) Cf revised Article 4, Paragraph 5 of Decree-Law 56/99/M.
(4) Cf Article 70, Paragraph 3 of the Commercial Registry Code.