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WEDNESDAY, JULY 25, 1990
SAID
OF THE
CONCERNING THE DEFINITION OF "RELEVANT INFORMATION", MR NENDICK IT WAS AGREED THAT A REVISED DEFINITION ALONG THE LINES DEFINITION IN THE UK COMPANY SECURITIES (INSIDER DEALING) ACT, SUBJECT TO MINOR MODIFICATIONS, SHOULD BE ADOPTED.
HE SAID THE AD HOC GROUP CONSIDERED THAT THE WOULD NARROW DOWN THE SCOPE OF RELEVANT INFORMATION AND BRING CERTAINTY TO THE MARKET.
NEW
DEFINITION GREATER
MR NENDICK, HOWEVER, POINTED OUT THAT THE PRESENT UK DEFINITION WOULD SHORTLY BE REPLACED BY THE DEFINITION USED
EUROPEAN IN THE
ON DIRECTIVE CO-ORDINATING REGULATIONS COMMUNITIES
AND IT WOULD BE NECESSARY TO CONSIDER IN DUE COURSE DEALING, THE EC DEFINITION SHOULD BE ADOPTED.
COUNCIL
"IT IS, THEREFORE, OUR INTENTION TO REVIEW THIS ISSUE LIGHT OF EXPERIENCE OF THE LEGISLATION IN OPERATION," HE SAID.
INSIDER WHETHER
IN THE
AS
IT
CONCERNING TRANSACTIONS WHICH WERE NOT ΤΟ BE REGARDED INSIDER DEALING FOR THE PURPOSE OF THE ORDINANCE, MR NENDICK SAID
THAT WAS ACCEPTED
AN OFF-MARKET TRANSACTION BETWEEN TWO INSIDERS SHOULD
THAT BE EXEMPTED IF THE PARTIES CONCERNED CAN ESTABLISH THE SAME HAD
LEVEL OF INFORMATION WHEN THEY ENTERED INTO THE TRANSACTION.
BACH
"CAVEAT
DEFENCE TO BE INCLUDED WOULD BE THE SO-CALLED ANOTHER EMPTOR" PROVISION, UNDER WHICH A PERSON WHO ENTERED INTO A TRANSACTION IN
AWARE, WHICH THE OTHER PARTY WAS AWARE, OR OUGHT REASONABLY TO BE THAT HE WAS DEALING WITH A CONNECTED PERSON WOULD NOT BE HELD TO BE AN INSIDER DEALER.
MR NENDICK SAID THE CONNECTED PERSON WOULD, HOWEVER, BE WELL ADVISED TO TAKE THE PRECAUTION OF OBTAINING A WRITTEN ACKNOWLEDGEMENT FROM THE OTHER PARTY THAT HE HAD THE REQUIRED AWARENESS AND TO THE DETAILS OF THE TRANSACTION TO THE SFC.
REPORT
"LIQUIDITY"
ON THE EFFECT OF THE BILL ON MARKET LIQUIDITY, MR NENDICK THE ADMINISTRATION BELIEVED THE LONG-TERM SOLUTION TO THE PROBLEM
WAS TO ENCOURAGE THE DEVELOPMENT IN HONG KONG OF DEALERS WERE ABLE TO ACT AS MARKET MAKERS IN THE PROPER SENSE OF THE TERM HAD THE CAPITAL TO SUPPORT SUCH OPERATIONS,
SAID
WHO
AND
"ANY MARGINAL REDUCTION IN LIQUIDITY OVER THE SHORT TERM WILL, IN OUR VIEW, BE MORE THAN OFFSET OVER TIME BY THE EXTRA INVESTMENT WHICH WILL BE ATTRACTED BY GREATER PUBLIC CONFIDENCE IN THE INTEGRITY OF THE MARKET AND BY IMPROVED PERCEPTION INTERNATIONALLY," HE SAID.
FOR AS
THE POSSIBILITY OF GRANTING EXEMPTION TO MAJOR SHAREHOLDERS TO HELP MARKET LIQUIDITY, HE SAID, THE EXEMPTION OF OFF- MARKET DEALS BETWEEN TWO INSIDERS AND THE "CAVEAT EMPTOR" PROVISION WOULD IN FACT PROVIDE A MEASURE OF EXEMPTION TO SUCH PERSONS.
"BUT, THIS APART, IT IS OUR FIRM VIEW THAT INSIDER DEALERS, BIG OR SMALL, SHOULD BE CAUGHT BY THE LAW," HE SAID.
/"IT WOULD
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