XN000022-1984-01-25 — Page 4

WEDNESDAY, JANUARY 25, 1984

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REFERRING TO MR BROWN'S SUGGESTION OF THE POSSIBLE NEED FOR AN ENTIRELY NEW COMPANIES BILL TO BE PRODUCED IF THE STANDING COMMITTEE RECOMMENDS SIGNIFICANT FURTHER CHANGES, MR JACOBS SAID THIS APPROACH MIGHT WELL BE APPROPRIATE IN FUTURE AND HE GAVE ASSURANCE THAT HE WOULD NOT LOSE SIGHT OF THE SUGGESTION.

HE DISCLOSED THAT ARRANGEMENTS HAD ALREADY BEEN MADE TO PRODUCE A REPRINT OF THE COMPLETE COMPANIES ORDINANCE

INCORPORATING THE AMENDMENTS CONTAINED IN THE BILL.

+THIS REPRINT WILL BE PUBLISHED AS SOON AS POSSIBLE AFTER THE AMENDMENTS HAVE BEEN BROUGHT INTO OPERATION, HE SAID.

HE WOULD ALSO BE MOVING AN AMENDMENT TO CLAUSE 46(B) (11) TO DELETE THE PROPOSED NEW SECTION 80 (2)(J), HE SAID.

THIS AMENDMENT WOULD REMOVE THE PROPOSED REQUIREMENT TO REGISTER A CHARGE ON SHARES HELD BY A COMPANY IN A BODY CORPORATE WHICH IS ITS SUBSIDIARY WHEN THE CHARGE IS CREATED.

+WHILE THIS REQUIREMENT IMPLEMENTS A CLRC RECOMMENDATION AND IS CONSIDERED TO BE HIGHLY DESIRABLE IN PRINCIPLE, IT BECAME APPARENT FROM COMMENTS MADE BY THE HONG KONG ASSOCIATION OF BANKS THAT IF THE NEW SECTION WERE ENACTED, THEY AND OTHER CREDITORS WOULD HAVE REAL DIFFICULTIES IN THAT THEY COULD NOT DE CERTAIN WHETHER THE SHARES TO WHICH A CHARGE RELATED WERE INDEED THOSE OF A SUBSIDIARY AS DEFINED IN THE PRINCIPAL ORDINANCE.

+HAVING CONSIDERED THESE COMMENTS, IT HAS BEEN AGREED THAT THE PROPOSED REQUIREMENT SHOULD BE DELETED AND THE MATTER REFERRED TO THE STANDING COMMITTEE ON COMPANY LAW REFORM FOR FURTHER CONSIDERATION, HE SAID.

MR JACOBS SAID ALSO THAT CONCERN HAD BEEN EXPRESSED BY THE LAW SOCIETY OF HONG KONG AND THE HONG KONG DEPOSIT-TAK ING COMPANIES ASSOCIATION ABOUT THE STAMP DUTY IMPLICATIONS FOR INTERNATIONAL BONDS IN THE PROPOSED NEW SECTION 74A IN CLAUSE 41 OF THE BILL.

WHILE NO AMENDMENT WOULD BE MADE TO THIS PROPOSED SECTION, WHICH BASICALLY SERVED COMPANY LAW PURPOSES, IT WAS THE

INTENTION OF THE ADMINISTRATION TO INTRODUCE IN DUE COURSE AN AMENDMENT TO THE STAMP DUTY ORDINANCE TO MEET THIS CONCERN, HE EXPLAINED,

MR JACOBS CONCLUDED BY THANKING ALL MEMBERS OF THE COMMUNITY WHO HAD TAKEN THE TROUBLE TO CONVEY THEIR VIEWS ON THE SUBJECT.

→THE IR WIDE KNOWLEDGE AND EXPERIENCE HAS CONTRIBUTED MUCH TO THAT CONSULTATIVE PROCESS WHICH IS ESSENTIAL IN COMPANY LAW REFORM, MR JACOBS CONCLUDED.

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