JP
DRAFT SPEECH BY HON PETER POON, MBE,
LEGISLATIVE COUNCIL 10 FEBRUARY 1988
Companies (Amendment) Bill 1988
MR. PETER POON:
Sir,
I rise to support the Companies (Amendment) Bill 1988. The amendments contained in the Bill mainly address the
le application of Section 161B of the present Companies Ordinance,
le
lo
le
be
le
introduced in 1984, to financial institutions which requires
the disclosure of loans to directors and officers. Financial
institutions have found that such disclosure in their annual
accounts to be cumbersome and undesirable in view of the nature
of their business. After consultation and review of similar
legislation in other major financial centres, the present Bill relaxes certain of the requirements by restricting the disclosure in the annual accounts of loans to directors and
officers of authorized financial institutions or their holding companies to those which are both concessionary and over $10m mullion. However, a register of all transactions referred to in Section 161B containing the relevant particulars must be maintained and available for public inspection for a period of fourteen days preceding the annual general meeting and seven days thereafter.
The Ad Hoc Group studying the Bill received representations from a leading firm of accountants and the Hong Kong Society of Accountants. Most of their helpful suggestions have been considered resulting in the proposed Committee Stage amendments. The one outstanding point which was brought up is
the difficulty in determining whether the loan is
concessionary. The term 'concessionary' is not used in the present Bill and that the wording conveying the meaning of concessionary already exists in the present section 157H of the Ordinance. The Ad Hoc group notes there might be difficulties
Companies
(I)