THURSDAY, JULY 18, 1991
COMPANIES (AMENDMENT) ORDINANCE 1991 ANNOUNCEMENT OF COMMENCEMENT
THE CURRENT
COMPANIES UNDER THE
SHARE
PROHIBITION ON COMPANIES ORDINANCE
LOCAL
BY REPURCHASES WILL BL LIFTED WHEN THE COMPANIES (AMENDMENT) ORDINANCE 1991 COMES INTO
ON OPERATION SEPTEMBER 1, A GOVERNMENT SPOKESMAN ANNOUNCED TODAY (THURSDAY).
COMPANIES
1991
THE SPOKESMAN SAID THE
(AMENDMENT} ORDINANCE WAS RECENTLY PASSED BY THE LEGISLATIVE COUNCIL ON JULY 3. SECTION 1(2) OF THE ORDINANCE PROVIDES THAT IT SHALL COME INTO OPERATION ON TO BE APPOINTED BY THE GOVERNOR BY NOTICE IN THE GAZETTE.
"WHILE
THE LIFTING
A
DAY
THE
PROHIBITION ON SHARE REPURCHASES,
ΤΟ SAFEGUARDS
PROTECT THE ORDINANCE PROVIDES A NUMBER OF IMPORTANT
HE SAID. INTERESTS OF CREDITORS AND NON-SELLING SHAREHOLDERS,
AS RECOMMENDED BY THE STANDING COMMITTEE ON COMPANY LAW REFORM, THE MAIN SAFEGUARDS ARE THAT:
* THE PURCHASE MUST BE PERMITTED BY THE COMPANY'S ARTICLES
ASSOCIATION;
OF
案
THE PRIOR APPROVAL
OF THE
SHAREHOLDERS
ANY то
PURCHASE
MUST BE OBTAINED;
THE SHARES TO BE PURCHASED MUST BE FULLY PAID;
* THE SHARES MUST BE PURCHASED OUT OF DISTRIBUTABLE PROFITS;
THE SHARES PURCHASED MUST BE CANCELLED; AND
THERE MUST BE PROMPT PUBLIC DISCLOSURE OF ALL PURCHASES.
REQUIREMENTS
THE
THE SPOKESMAN SAID THE PRIOR SHAREHOLDER APPROVAL VARY ACCORDING TO THE TYPE OF COMPANY IS LISTED OR UNLISTED.
REPURCHASE PROPOSED AND WHETHER
FLEXIBILITY. THE
"AT THE SAME TIME, WE RECOGNISE THE NEED FOR A (SFC) IS GIVEN
BROAD SECURITIES AND FUTURES COMMISSION
DISCRETION FOR LISTED COMPANIES TO WAIVE THE SHAREHOLDER APPROVAL REQUIREMENTS
A MARKET CIRCUMSTANCES, SUCH AS IN IN EXCEPTIONAL
DISCRETION, THE COMMISSION WILL ALWAYS EXERCISING THIS
T HE SAID. REGARD TO THE INTERESTS OF NON-SELLING SHAREHOLDERS,
IN CRISIS.
HAVE DUE
ON THE COMES
HE ALSO SAID THE SFC WILL PUBLISH EXERCISE OF THIS DISCRETION INTO OPERATION.
GUIDELINES IN THE GAZETTE BEFORE THE PROPOSED LEGISLATION
"THE
ORDINANCE
ALSO COVERS
THE
RELATED SUBJECT
OF THE THIRD PARTY
FOR
PROVISION OF FINANCIAL ASSISTANCE BY A COMPANY TO A THE PURCHASE OF THAT COMPANY'S SHARES.
MEANING
OF
'FINANCIAL
"IT CLARIFIES THE IMPOSES A GENERAL PROHIBITION ON THE PROVISION OF IT.
ASSISTANCE'
/HOWEVER, THE
AND
Page 10Page 11