Form NM2: Notification of Payment, Satisfaction of Debt or Release from Charge in Hong Kong

Form NM2 Hong Kong Satisfaction of Charge Filing

A Hong Kong company that repays a secured debt or obtains a release from a charge must notify the Companies Registry using Form NM2 Hong Kong satisfaction of charge. The form is the statutory mechanism under the Companies Ordinance (Cap. 622) for recording that a charge previously registered on Form NM1 has been fully satisfied, the debt paid, or the property released. Filing Form NM2 keeps the public register accurate. It stops a satisfied charge from appearing as an ongoing encumbrance.

Purpose of Form NM2

Form NM2 is the follow-up to Form NM1 (Statement of Particulars of Charge). NM1 registers the creation of a charge. NM2 tells the Companies Registry the charge no longer exists. File the form within one month of the date of satisfaction, payment of the debt, or release from the charge. A satisfied charge left on the public record misleads creditors, potential investors, and anyone conducting company searches.

Hong Kong Charge Satisfaction NM2: What the Form Requires

The Hong Kong charge satisfaction NM2 form demands specific details about the original charge and the satisfaction event:

• The company's name and company number
• The date the charge was originally created
• The date the charge was registered with the Companies Registry (the NM1 filing date)
• The date of satisfaction, payment, or release
• A statement confirming the charge has been satisfied, the debt has been paid, or the property has been released
• The signature of the company secretary, director, or authorised person

Complete the form accurately. Any discrepancy between the particulars on NM2 and the original NM1 filing will cause processing delays or rejection.

NM2 Form Companies Registry: Filing Requirements

The NM2 form Companies Registry filing process follows standard procedures for specified forms under Cap. 622. Submit:

• The completed NM2 form
• The prescribed filing fee (check the current fee schedule on the Companies Registry website)
• A certified true copy of any instrument evidencing the satisfaction or release, if applicable

File through the Companies Registry's e-Services portal or by paper submission to the Registry's office. Electronic filing is faster and gives immediate confirmation of receipt. Send paper filings to the Companies Registry at 14/F, Queensway Government Offices, 66 Queensway, Hong Kong.

Release From Charge Hong Kong NM2: When to File

A release from charge Hong Kong NM2 situation arises when a charge is discharged before the full debt is repaid, or when the charged property is released while other assets remain encumbered. Common scenarios:

• Full repayment of a loan secured by a charge
• Partial release of property from a charge (for example, when a specific asset is sold and the charge is lifted from that asset only)
• Variation of the charge terms that results in the original charge being replaced
• Court order discharging the charge

The one-month filing deadline runs from the date of the satisfaction, payment, or release. The Companies Registry does not grant extensions. A company may file a late NM2 with an explanation, but late filing attracts higher registration fees and the Registry may reject the filing if the delay is excessive.

Consequences of Not Filing Form NM2

Fail to file Form NM2 after satisfying a charge, and the consequences stack up:

• The satisfied charge remains on the public register as an active encumbrance
• The company cannot obtain clear title when selling charged assets
• Creditors and lenders conducting due diligence will see outstanding secured debt that does not exist
• The company's directors and officers face penalties under Cap. 622 for non-compliance

For companies undergoing deregistration, all outstanding charges must be satisfied and Form NM2 filed before the Companies Registry will process the deregistration application (Form NDR1). A struck-off company with unresolved charges on the register cannot be restored without first addressing the charge status.

Relationship Between NM1 and NM2

Form NM1 registers the particulars of a charge when it is created. Form NM2 closes the record when the charge is satisfied. The two forms maintain an accurate charge register together. When completing NM2, reference the original NM1 filing date. If the original NM1 was never filed, the charge is void against a liquidator or creditor under section 337 of Cap. 622. NM2 cannot be filed until NM1 is submitted, with late filing penalties.

Filing Fee and Processing Time

The filing fee for Form NM2 is set by the Companies Registry and subject to periodic revision. The standard fee is HK$45 for paper filing and HK$30 for electronic filing through the e-Services portal. Processing times differ. Electronic filings are processed within one working day. Paper filings take three to five working days. The Registry does not offer expedited processing for NM2.

Practical Tips for Completing Form NM2

• Obtain a certified true copy of the satisfaction or release document before filing
• Verify the company number and name exactly as registered with the Companies Registry
• Check the original NM1 filing date against the company's charge register
• Ensure the form is signed by an authorised person (company secretary, director, or solicitor)
• Keep a copy of the filed NM2 for the company's records
• Update the company's internal charge register to reflect the satisfaction

Where to Obtain Form NM2

Download Form NM2 from the Companies Registry's specified forms index. The Registry updates forms periodically. Always download the current version rather than using a saved copy. The form is also available through the e-Services portal for electronic filing.

Supporting Documentation

Retain the following supporting documents when filing Form NM2:

• The original charge instrument (if available)
• Evidence of payment or release (bank statements, release deed)
• Correspondence with the charge holder confirming satisfaction
• The original NM1 filing receipt

These documents are not submitted with NM2 but must be kept in case the Companies Registry requests verification.

Charges and Debenture Holders

Where debenture holders hold a charge, document the satisfaction or release in accordance with the terms of the debenture trust deed. Obtain confirmation from the trustee or debenture holders that the charge is satisfied before filing NM2. In some cases, the debenture holders may file NM2 themselves if the charge instrument grants them that right.

Summary of Key Points

• Form NM2 must be filed within one month of satisfaction, payment, or release
• The form requires details of the original charge and the satisfaction event
• Failure to file leaves a satisfied charge on the public register
• Filing can be done electronically or by paper
• The fee is lower for electronic filing
• The form is available from the Companies Registry website