XN000022-1995-10-25 — Page 39

29

Codes of practice and guidelines laid down by SFC

Following is a question by the Hon Chim Pui-chung and a written reply by the Secretary for Financial Services, Mr Rafael Hui, in the Legislative Council today (Wednesday):

Question:

With regard to the codes of practice and guidelines laid down by the Securities and Futures Commission (SFC), will the Government inform this Council:

(a) whether such codes of practice and guidelines will become an alternative set

of laws;

(b) whether the SFC will be requested to be more open and transparent by letting the public know about its power and the criteria for discharging its functions; and

(c) whether there is any mechanism to prevent the abuse of authority under

those codes and guidelines?

Reply:

(a) The codes of practice and guidelines of the Securities and Futures Commission (the Commission) do not have the force of law. There is no intention for them to become an alternative set of laws.

(b) Section 4(2) of the Securities and Futures Commission Ordinance (the Ordinance) provides that the Commission may, for the guidance of registered persons and others, prepare and cause to be published in the Gazette guidelines indicating the manner in which, in the absence of any particular consideration or circumstance, it proposes to perform any function. Over the years, the Commission has published guidelines regulating market conduct and criteria under which the Commission is bound to act. For example, the Commission has published -