FRIDAY, JUNE 22, 1984
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PLAN TO REMOVE FOREIGN CURRENCY RESTRICTION
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THE LEGAL RESTRICTION ON USING FOREIGN CURRENCY NOTES IN TRANSACTIONS IN HONG KONG, BASED ON AN ORDINANCE ENACTED IN 1913, IS TO BE REMOVED UNDER A BILL PUBLISHED IN THE GAZETTE TODAY.
A GOVERNMENT SPOKESMAN EXPLAINED THAT THE PROPOSAL WAS TO REPEAL THE FOREIGN NOTES (PROHIBITION OF CIRCULATION) ORDINANCE WHICH HAS BECOME OBSOLETE.
FOR EXAMPLE, ONE OF THE ORIGINAL REASONS FOR RESTRICTING THE CIRCULATION OF FOREIGN NOTES WAS TO AVOID COMPETITION WITH LOCAL NOTES WHICH WERE DISADVANTAGED BY STAMP DUTY REQUIREMENTS. THIS IS NO LONGER RELEVANT SINCE STAMP DUTY IS NO LONGER LEVIED ON THE NOTE ISSUE, THE SPOKESMAN SAID.
ANOTHER ASPECT OF THE ORDINANCE WHICH HAS BECOME OUT-OF- DATE IS ITS REFERENCE TO +LICENSED MONEY-CHANGERS BECAUSE THE LICENSING REQUIREMENT CEASED WITH THE ENACTMENT OF THE MISCELLANEOUS LICENCES (AMENDMENT) ORDINANCE IN 1978,
+FURTHERMORE IT IS COMMONPLACE NOWADAYS FOR BUSINESSES LIKE HOTELS AND TOUR OPERATORS TO ACCEPT PAYMENT IN FOREIGN NOTES IT IS ANOMALOUS THAT THIS PRACTICE IS TECHNICALLY UNLAWFUL WHEREAS FOREIGN CURRENCY TRANSACTIONS IN TRAVELLERS CHEQUES ARE LAWFUL, + THE SPOKESMAN SAID.
THE ANOMALY WAS HIGHLIGHTED LAST SEPTEMBER WHEN SOME SHOPS ASKED FOR PAYMENT IN FOREIGN CURRENCIES BECAUSE OF FLUCTUATIONS IN THE HK DOLLAR EXCHANGE RATE. THE HK DOLLAR HAS SINCE REMAINED STABLE FOLLOWING ITS LINKAGE WITH THE US DOLLAR.
+THE GOVERNMENT DOES NOT ENFORCE THE PROHIBITION SO THERE IS A CLEAR CASE FOR REPEAL, THE SPOKESMAN ADDED.
THE FOREIGN NOTES (PROHIBITION OF CIRCULATION) (REPEAL) BILL 1984 IS SCHEDULED TO BE INTRODUCED INTO THE LEGISLATIVE COUNCIL ON JUNE 27 FOR FIRST READING AND TO COMPLETE THE REMAINING LEGISLATIVE PROCEDURES ON JULY 11.
ANYONE WHO WISHES TO COMMENT ON THE BILL MAY WRITE TO UMELCO AT SWIRE HOUSE, 12TH FLOOR, CHATER ROAD, OR TO THE SECRETARY FOR MONETARY AFFAIRS, AT ADMIRALTY CENTRE, TOWER 11, 24TH FLOOR, 18 HARCOURT ROAD, HONG KONG.