WEDNESDAY, APRIL 24, 1991
1.
ACTING FS SPEAKS ON SPECIAL EXEMPTIONS MOTION * * * * *
THE
FOLLOWING IS THE FULL TEXT OF THE FINANCIAL SECRETARY, THE HON HAMISH MACLEOD, COUNCIL TODAY (WEDNESDAY) DURING THE MOTION EXEMPTIONS FOR LISTED COMPANIES:
SPEECH
BY THE ACTING IN THE LEGISLATIVE DEBATE ON SPECIAL
I HAVE LISTENED WITH GREAT INTEREST TO THE VIEWS EXPRESSED IN THIS DEBATE. I BELIEVE THE PREDOMINANTLY THOUGHTFUL AND RATHER SOMBRE SPEECHES REFLECT THE IMPORTANCE AND THE COMPLEXITY OF THE ISSUE. LET ME BEGIN BY ASSURING MEMBERS THAT OUR POLICIES IN RELATION TO THE FINANCIAL MARKETS ARE INDEED AS URGED IN THE MOTION UNDER DEBATE, FORMULATED AND EXECUTED WITHOUT FEAR OR FAVOUR, AND THAT THE ADMINISTRATION AND THE REGULATORS PLACE GREAT IMPORTANCE ON ENSURING THAT THE INTERESTS OF INVESTORS ARE ADEQUATELY PROTECTED AND THE INTEGRITY OF THE MARKET PRESERVED. THIS IS ESSENTIAL IF WE ARE ΤΟ MAINTAIN HONG KONG'S STATUS AS A LEADING INTERNATIONAL FINANCIAL CENTRE, AN AIM WE SHARE WITH MR STEPHEN CHEONG AND I BELIEVE ALL OTHER MEMBERS WHO HAD SPOKEN IN THIS DEBATE.
I HAVE TAKEN CAREFUL NOTE OF THE CONCERN EXPRESSED BY MANY MEMBERS OVER THE CONCEPT OF CREATING A SPECIAL EXEMPT STATUS FOR CERTAIN COMPANIES. THESE COMMENTS WILL BE CAREFULLY CONSIDERED AS THE SECURITIES AND FUTURES COMMISSION AND THE STOCK EXCHANGE OF HONG KONG CONSIDER THE CONCEPT FURTHER. THE BASIC CONCEPT IS DESIGNED TO ALLOW SOME DEGREE
FLEXIBILITY IN REGULATORY MATTERS, THUS MAKING IT POSSIBLE FOR COMPANIES THAT ARE SUBJECT TO REGULATION IN ANOTHER CENTRE WHICH HAS A REGULATORY FRAMEWORK, NO LESS COMPREHENSIVE AND EFFECTIVE THAN IN HONG KONG, TO BE LISTED HERE.
AS FAR AS WE ARE AWARE, THERE ARE NO PRECEDENTS IN THE FIELD OF SECURITIES REGULATION FOR COMPANIES WITH THEIR PRINCIPAL FOCUS OF ACTIVITY IN ONE CENTRE TO BE SUBJECT TO THE REGULATORY REGIME OF ANOTHER CENTRE, THOUGH THE CONCEPT CAN BE FOUND IN BANKING. THUS WE ARE CONSCIOUS OF THE NEED TO PROCEED CAUTIOUSLY, OBJECTIVELY AND COOLLY. NEVERTHELESS THE FACT THAT HONG KONG'S SITUATION IS IN MANY WAYS UNIQUE MAY JUSTIFY BEING PREPARED TO LOOK AT INNOVATIVE SOLUTIONS, ALWAYS PROVIDED THESE DO NOT COMPROMISE INVESTOR PROTECTION, THE PRINCIPLES OF FAIRNESS AND THE INTEGRITY OF THE REGULATORY SYSTEM.
AS MANY MEMBERS HAVE POINTED OUT, THE PARTICULAR ISSUE WHICH WILL HAVE TO BE ADRESSED, IS THE APPLICATION OF TAKE-OVER RULES. IT WOULD BE PREMATURE FOR ME AT THIS STAGE TO GO INTO DETAILS OF THE CONCEPT. THE SECURITIES AND FUTURES COMMISSION AND THE STOCK EXCHANGE ARE STILL DEVELOPING THEIR THINKING AND MANY ASPECTS CLEARLY REMAIN TO BE WORKED OUT. BUT I CAN ASSURE MEMBERS THAT WHEN DETAILS HAVE BEEN FINALISED, THERE WILL BE EXTENSIVE PUBLIC CONSULTATION IN ADVANCE OF ANY DECISION BEING REACHED. THE PUBLIC AND INTERESTED PARTIES WILL THEN HAVE AMPLE OPPORTUNITY TO CONSIDER THE IMPLICATIONS OF ANT PROPOSALS AND THE EFFECT THEIR ADOPTION MIGHT HAVE ON THE INTEGRITY OF THE HONG KONG MARKET AND ON ITS INTERNATIONAL CREDIBILITY.
/FINALLY, I