XN000022-1988-06-06 — Page 4

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MONDAY, JUNE 6, 1988

"THE BILL, WHICH PROPOSES TO REQUIRE SUBSTANTIAL SHAREHOLDERS, DIRECTORS AND CHIEF EXECUTIVES OF LISTED COMPANIES INCORPORATED IN HONG KONG TO DISCLOSE THEIR SHAREHOLDINGS AND SHARE DEALINGS WAS FIRST PUBLISHED IN JUNE 1987 AS A WHITE BILL FOR PUBLIC CONSULTATION, MR NENDICK SAID.

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"DURING THE CONSULTATION PERIOD, 20 SUBMISSIONS WERE RECEIVED FROM BUSINESS AND PROFESSIONAL ORGANISATIONS.

"HAVING CONSIDERED ALL THE COMMENTS RECEIVED, HAS MADE CERTAIN AMENDMENTS.

THE GOVERNMENT

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MR NENDICK SAID THE PURPOSE OF THE BILL WAS TO ENABLE THE PUBLIC AND THE MANAGEMENT OF LISTED COMPANIES TO KNOW WHO ACTUALLY CONTROLLED THE LISTED COMPANY, AND THEREBY TO MAKE CREEPING AND INSIDER DEALING HARDER TO CONCEAL.

TAKEOVERS

DESCRIBING ITS MAIN PROVISIONS, MR NENDICK SAID THE BILL IMPOSED A DUTY OF DISCLOSURE ON ANY PERSON WHO ACQUIRED A NOTIFIABLE INTEREST WHICH WAS SET AT 10 PER CENT OR MORE OF THE ISSUED VOTING SHARES OF A LISTED COMPANY.

A SHAREHOLDER WITH AN EXISTING NOTIFIABLE INTEREST WOULD ALSO BE UNDER A DUTY TO INFORM THE COMPANY WHEN THERE WAS A CHANGE OF ONE PER CENT OR MORE IN HIS HOLDING.

"THE BILL PROVIDES THAT EVERY LISTED COMPANY MUST KEEP A REGISTER AND INDEX TO RECORD INFORMATION DISCLOSED BY SUBSTANTIAL SHAREHOLDERS IN RESPECT OF THEIR SHAREHOLDINGS AND DEALINGS," HE SAID.

"THE LISTED COMPANY IS THEN REQUIRED TO NOTIFY THE INFORMATION TO THE UNIFIED EXCHANGE AND THE COMMISSIONER FOR SECURITIES. THE EXCHANGE WILL BE OBLIGED TO ARRANGE FOR THE INFORMATION ΤΟ BE DISPLAYED IN A PUBLIC PLACE.

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MR NENDICK EMPHASISED THAT À LISTED COMPANY WOULD BE EMPOWERED TO INVESTIGATE ITS OWN SHAREHOLDINGS.

THE COMPANY MAY, ON ITS OWN INITIATIVE, REQUIRE ANY PERSON WHOM IT KNOWS OR REASONABLY BELIEVES TO HAVE OR TO HAVE HAD AN INTEREST IN ITS SHARES WITHIN THE PREVIOUS THREE YEARS TO SUPPLY IT WITH INFORMATION.

IF THE PERSON SHOULD FAIL TO SUPPLY THE INFORMATION REQUIRED, THE COMPANY MAY APPLY TO THE HIGH COURT FOR A "FREEZING ORDER" IMPOSED ON THE SHARES CONCERNED.

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/A LISTED