XN000022-1997-01-15 — Page 14

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Further measures to dampen property speculation through companies

The Secretary for Housing, Mr Dominic Wong, warned today (Wednesday) that if voluntary measures adopted by property developers fail to curb speculation, the Government will take action to restore the proper operation of the market in the public interest.

In reply to a question raised by the Hon Chan Wing-chan in the Legislative Council, Mr Wong said that the Government was concerned about the revival of speculative activities in the property market, especially in the upper end of the market and particularly through the use of shell companies and the sale of "chips".

"We welcome the introduction of new sales arrangements announced by the Real Estate Developers Association of Hong Kong (REDA) last Friday (10 January) as a first step to dampen speculation through companies. We have urged REDA yesterday to adopt additional measures to help to bring the present bout of speculative activity to an end," Mr Wong said. "REDA members have decided to introduce with immediate effect the following measures:

To prohibit the resale of uncompleted flats under the Consent Scheme through companies by way of change of directorship in the period between registration and completion of assignment (i.e. issue of the certificate of compliance or consent to assign, whichever is the earlier).

Flat sale to companies will be limited to the last 15 per cent of each batch of flats under the Consent Scheme put up for sale so as to ensure that genuine end-users' interests are protected;

To promulgate clearly in sales brochures and newspaper advertisements the total number of flats available for pre-sale in each housing development under the Consent Scheme;

To ensure that the 10 per cent of flats under the Consent Scheme disposed by private sale will only go to genuine end-users and will not become available in the open market for speculation; and

REDA will also encourage its members to adopt the above measures for sale of flats which have already been given consent for pre-sale, and sale of flats which fall outside the Consent Scheme.

Mr Wong welcomed the additional measures. "The prohibition of resale of uncompleted flats under the Consent Scheme by way of change of company directorship will effectively tackle speculation through the sale of chips and through companies by ensuring parity of treatment for company and individual purchasers.