FINANCIAL AND MONETARY AFFAIRS
100
The SCCLR has taken on the Overall Corporate Governance Review announced by the Financial Secretary in his Budget Speech in March. The objectives of the review are to identify and bridge any gaps in the corporate governance regime, making it a benchmark in the region. The SCCLR has set up three subcommittees to examine subjects relating to directors, shareholders and corporate reporting. The review is making good progress.
Money Lenders
Under the Money Lenders Ordinance, anyone wishing to carry on business as a money lender must apply to a licensing court for a licence. The ordinance does not apply to institutions authorised under the Banking Ordinance.
Licence applications are, initially, submitted to the Registrar of Companies as Registrar of Money Lenders. A copy is also sent to the Commissioner of Police who may object to the application. The application is advertised, and any member of the public who has an interest in the matter also has the right to object. During the year, 942 applications were received. Based on the applications received during the year and outstanding applications brought forward from the previous year, a total of 854 licences were granted. At the end of 2000, there were 945 licensed money lenders. The ordinance provides severe penalties for statutory offences such as carrying on an unlicensed money-lending business. It also provides that any loan made by an unlicensed money lender shall not be recoverable by court action. With certain exceptions (primarily authorised institutions under the Banking Ordinance) any person, whether a licensed money lender or not, who lends or offers to lend money at an interest rate exceeding 60 per cent per annum commits an offence. Any agreement for the repayment of any such loan, or security given in respect of such loan, is unenforceable.
Bankruptcies, Individual Voluntary Arrangement and Compulsory Winding-up
The Official Receiver's Office administers the estates of individuals adjudged to be bankrupt by the Court of First Instance of the High Court and companies ordered to be compulsorily wound up by the court.
The Official Receiver becomes the receiver of an individual debtor or provisional liquidator of a company when a bankruptcy order against the property of the debtor or a winding-up order against the company is made by the court. Where the assets of an estate do not exceed $200,000, the Official Receiver will normally be appointed trustee or liquidator by a summary procedure order. In other cases, a meeting of creditors in bankruptcy, or meetings of creditors and contributories in compulsory liquidation will be convened to decide whether the Official Receiver or some other fit persons from the private sector should be appointed trustee or liquidator.
When he acts as trustee or liquidator, the Official Receiver investigates the affairs of the bankrupt or the wound-up company, realises assets and distributes dividends to creditors. The Official Receiver also prosecutes certain offences set out in the Bankruptcy and Companies Ordinances, applies for disqualification orders against unfit company directors, supervises the work of outside liquidators and trustees, and monitors the funds held by liquidators in compulsory and voluntary liquidations.
In order to alleviate the huge increase in the workload of the Official Receiver, a scheme had been established to contract out the summary winding-up cases to the