XN000022-1973-01-06 — Page 4

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Saturday, January 6, 1972

be empowered to take up with the stock exchanges, underwriters, financial

institutions acting as issuing houses and other organisations and persons

involved in trading in securities any matters which, in its view, appear to

give rise to concern and which call for authoritative rulings.

In addition,

the Council will deal with a range of problems arising from the implementation

of other bille which are now being drafted to deal with takeover bids and the

regulation of mutual funds and unit trusts which are on sale within Hong Kong."

Authoritative Guidance

The Financial Secretary went on to explain that the drafting of this

Bill was complicated and that it would not be ready for some months but

that "it would not be prudent to wait until the enactment of the Bill before

taking action to provide some more authoritative guidance and help to those

responsible for managing the stock exchanges and other institutions in the

field of trading in securities". The Government had therefore decided to

establish now, on an administrative basis, a Securities Advisory Council and a

post of Commissioner for Securities.

The Financial Secretary added that, as neither the Securities Advisory

Council nor the Commissioner of Securities would, for the time being at least,

have statutory powers, the Council would not have any formal terus of reference.

But he was convinced that "the knowledge that the introduction of statutory powers

is envisaged will give the Securities Advisory Council considerable influence

from the outset",

/As regards