XN000022-1991-07-18 — Page 10

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

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