BY THE GOVERNOR.
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3. THE SRC BELIEVED THAT THIS PROPOSED STRUCTURE COULD FORM THE
BASIS OF A WELL-BALANCED COUNCIL ON WHICH ALL PRINCIPAL INTERESTS WILL BE REPRESENTED, AND WHICH WOULD BE UNLIKELY TO BE DOMINATED BY ANY SINGLE INTEREST GROUP.
THE SEHK'S RECONSTITUTION PROPOSALS
4. IN THE LIGHT OF THE SRC RECOMMENDATIONS, AND AFTER DISCUSSING WITH GOVERNMENT, THE SEHK MANAGEMENT COMMITTEE (MC) DECIDED, AT ITS MEETING ON 28 JUNE 1988, THAT AN EXTRAORDINARY GENERAL MEETING (EGM) BE CONVENED ON 20 JULY TO CONSIDER THEIR PROPOSED AMENDMENTS TO THE EXCHANGE'S MEMORANDUM AND ARTICLES OF ASSOCIATION (MEMART). THESE PROPOSALS COVER THE SRC RECOMMENDATIONS REGARDING THE COMPOSITION OF THE COUNCIL AND THE NOMINATING COMMITTEE IN PARAGRAPH 2 (A) AND (B).
5. HOWEVER, ON THE TRANSITIONAL MEASURES INVOLVING THE ESTABLISH- MENT OF THE FIRST COUNCIL, THE MC PROPOSED THAT ALL CANDIDATES FOR THE RESERVE PLACES BE NOMINATED BY THE PRESENT COMMITTEE, WHO WOULD ALSO APPOINT THE FIRST LAY MEMBERS. THIS IS DIFFERENT FROM THE SRC RECOMMENDATIONS IN PARAGRAPH 2(C) BUT IN RESPONSE TO GOVERNMENT'S REQUIREMENT, THERE ARE PROVISIONS REQUIRING (NEXT TWO WORDS UNDERLINED) ALL CANDIDATES FOR APPOINTMENT OR STANDING FOR ELECTION ΤΟ AND THE CHAIRMAN OF THE NEW COUNCIL (NEXT 18 WORDS UNDERLINED)
TO HAVE THE PRIOR APPROVAL OF THE GOVERNOR.
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THE GOVERNMENT'S RESPONSE
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6. THE GOVERNMENT HAS WELCOMED THE SEHK'S VOLUNTARY EFFORTS IN BRINGING ABOUT THE EARLY IMPLEMENTATION OF THE MAJORITY OF THE SRC RECOMMENDATIONS CONCERNING THE RECONSTITUTION OF THE EXCHANGE. IT IS SATISFIED THAT THE PROPOSALS ARE IN LINE WITH THE SPIRIT OF THE
RECOMMENDATIONS.
7. GOVERNMENT'S ENDORSEMENT OF THE PROPOSED TRANSITIONAL ARRANGEMENTS, WHICH DIFFER SUBSTANTIALLY FROM THE SRC RECOMMENDATIONS HAS BEEN GIVEN ON THE UNDERSTANDING THAT, UNDER THE REVISED ARRANGEMENTS THE GOVERNMENT WILL BE ABLE TO PREVENT UNSUITABLE PERSONS FROM JOINING THE COUNCIL BECAUSE ALL CANDIDATES WOULD REQUIRE THE GOVERNOR'S PRIOR APPROVAL (SEE PARAGRAPH 5).
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8. VOLUNTARY AMENDMENT OF THE MEMART BY MEMBERS OF THE EXCHANGE TO IMPLEMENT THE SRC RECOMMENDATIONS HAS THE DISTINCT ADVANTAGE OF SIGNIFYING TO BOTH THE LOCAL AND OVERSEAS INVESTING COMMUNITIES THAT THE SEHK IS FULLY CO-OPERATIVE IN RECONSTITUTING ITS GOVERNING
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