TNAG-1645-FCO40-2292-Company-law-reform-in-Hong-Kong-Companies-(Amendment)-(No.-2-1987 — Page 71

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1.16

This state of affairs was recognised by the Companies Law

Revision Committee who recommended extensive amendments to Section 48

in their Second Report (April 1973). These amendments were intended,

basically, to bring our Section 48 into line with the then-current

Section 54 of the Companies Act 1948 and, in addition, to implement a

number of important amendments which the Jenkins Committee had recommended

in respect of Section 54.

1.17

The Companies (Amendment) Bill which was published in 1980

This

as a White Paper contained a proposed new version of Section 48 of the

Companies Ordinance which incorporated the recommendations made in

the Second Report of the Companies Law Revision Committee.

proposed new version, however, attracted criticism from the Law

Society of Hong Kong and the Hong Kong General Chamber of Commerce.

The Law Society felt that the proposed new version gave rise to

so many problems that the law should be left as it was, or a new

Section 48 in the same terms as Section 54 of the Companies Act 1948

should be substituted. The General Chamber of Commerce also felt that

Section 48 should be redrafted in the same form as Section 54 of the

1948 Act.

1.18

By the time an ad-hoc working group of UMELCO members came to

consider the Law Society's and the General Chamber of Commerce's comments

on the Bill in detail, new British legislation on the subject had arrived

in the shape of Sections 42, 43 and 44 of the Companies Act 1981. However,

this new legislation was not a straightforward implementation of the Jenkins

Committee recommendations for amendments to Section 54 of the Companies

Act 1948. Not only did it contain a complete prohibition, subject to

certain technical exemptions, of provision of financial assistance by

a public company, but the provisions allowing a private company to provide

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