under the Business Registration Ordinance 1959, including limited companies of which there were then 4,342 on the register, the number of bankruptcies and compulsory liquidations occurring annually is remarkably small. There have, in fact, in the past five years been only thirty seven Adjudication Orders, one Order for the Administration in Bankruptcy of the estate of a deceased debtor, and twelve Orders for the winding-up of companies by the Court. The principal reason why these numbers are so small is that the legal costs of a creditor's petition are fairly high, and experience has shown that usually most of the assets of a debtor or company in financial difficulties have been given in security so that often no dividend is payable to non-preferential creditors. Creditors are therefore generally not disposed to go to the trouble and expense of initiating proceedings unless there are substantial assets and prospects of a worth-while dividend. As for debtors' petitions in bankruptcy, these are not so common as they might be for two reasons: the Chinese as a race are reluctant to become involved with the authorities, if they can avoid it, and secondly a petition always spells trouble and frequently results in a prosecution.
85. The net result is that the cases which do go to Court are usually large and almost always extremely complicated. Practically all of these cases fall to be dealt with solely by the Official Receiver, for in recent years it has become the standard practice to appoint the Official Receiver as trustee or liquidator. In the past five years there has been only one case where an outside trustee has been appointed.
New Cases
86. Eleven bankruptcy petitions were presented during the year, the same number as in 1959-60. One was withdrawn, two were adjourned sine die, and two were pending at the end of the year. Receiving Orders were made in the other six cases and also in a case where the petition was presented the previous year. One Receiving Order was however later rescinded. Adjudication Orders followed in four cases, and one was also made in a 1959-60 case. The Official Receiver became Trustee in all five cases.
87. Orders were made by the Court for the winding-up of three companies, in all of which the Official Receiver as usual became Liquidator. One petition for the winding-up of a company submitted in 1959-60 was still pending at the end of the year. This related to a
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