XN000022-1984-01-25 — Page 5

WEDNESDAY, JANUARY 25, 1984

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UNOFFICIALS BACK COMPANY LAW REFORM COMMITTEE

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THE LEGCO AD-HOC GROUP ON THE COMPANIES (AMENDMENT) BILL 1983 WELCOMED THE ESTABLISHMENT OF A STANDING COMMITTEE ON COMPANY LAW REFORM, THE HON BILL BROWN SAID TODAY, AT THE RESUMED DEBATE ON THE COMPANIES (AMENDMENT) BILL IN THE LEGISLATIVE COUNCIL.

SUPPORTING THE MOTION, MR BROWN SAID THAT PLACING THE BILL ON THE STATUTE BOOK WOULD BE A FURTHER MILESTONE ON A JOURNEY WHICH COMMENCED IN 1974 WHEN A PROGRAMME OF LEGISLATION WAS

INITIATED TO IMPLEMENT THE RECOMMENDATIONS OF THE COMPANIES LAW REVISION COMMITTEE SECOND REPORT, PUBLISHED IN APRIL 1973.

+WE STILL HAVE A LONG WAY TO GO DOWN THIS ROAD AND A NUMBER OF VERY IMPORTANT ISSUES STILL NEED TO BE ADDRESSED, HE ADDED.

IT WAS FOR THIS REASON THAT THE UNOFFICIAL MEMBERS PARTICULARLY WELCOMED THE ESTABLISHMENT OF THE SAID STANDING COMMITTEE.

MATTERS TO BE REFERRED TO THE NEW COMMITTEE INCLUDE:

* TO CONSIDER WHETHER THE ULTRA VIRES DOCTRINE SHOULD

BE MAINTAINED AND THE EXTENT OF PROTECTION THAT SHOULD BE AFFORDED TO THIRD PARTIES IN ULTRA VIRES TRANSACTIONS,

TO CONSIDER THE QUESTION OF RESTRICTION ON THE GIVING OF FINANCIAL ASSISTANCE BY A COMPANY FOR THE PURCHASE OF ITS OWN SHARES; IN THIS CONNECTION TO CONSIDER $IMULTANEOUSLY THE QUESTION OF WHETHER A COMPANY SHOULD BE ABLE TO PURCHASE ITS OWN SHARES WHICH IS NOW ALLOWED IN BRITAIN UNDER SECTIONS 46 - 52 OF THE COMPANIES ACT 1981.

* TO REVIEW THE LAW ON REGISTRATION OF CHARGES IN THE

LIGHT OF THE MANY SUGGESTIONS MADE BY VARIOUS MEMBERS OF THE PUBLIC FOR FAR-REACHING AMENDMENTS EVEN TO THE EXTENT OF DEPARTING FROM THE BRITISH SYSTEM. IN THIS CONNECTION, TO CONSIDER MATTERS ARISING FROM THE APPLICATION OF PART III OF THE ORDINANCE ON THE SUBJECT TO A COMPANY INCORPORATED OUTSIDE HONG KONG IN THE LIGHT OF FINDINGS IN THE SLAVENBURG CASE.

TO CONSIDER WHETHER IN THE CASE OF A PRIVATE COMPANY WHICH IS NOT A MEMBER OF A GROUP OF COMPANIES WHICH INCLUDES A LISTED COMPANY, APPROVAL OF THE COMPANY SHOULD BE REQUIRED FOR THE DISPOSAL OF ITS FIXED ASSETS BY ITS DIRECTORS.

* TO CONSIDER THE REQUIREMENT IN THE PROPOSED NEW

SECTION 155D (DIRECTOR'S DUTY REGARDING INFORMATION TO SHAREHOLDERS) IN THE COMPANIES (AMENDMENT) BILL 1983 AND IN PARTICULAR TO SEE WHETHER ANY FURTHER EXEMPTIONS ARE JUSTIFIED.

TO CONSIDER