ENG-1996 — Page 126

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FINANCIAL AND MONETARY AFFAIRS

Licence applications are, initially, submitted to the Registrar of Companies as Registrar of Money Lenders. A copy is also sent to the Commissioner of Police, who may object to the application. The application is advertised, and any member of the public who has an interest in the matter also has the right to object. During the year, 1 024 applications were received and 860 licences were granted. At the end of 1996, there were 1 018 licensed money lenders.

The ordinance provides severe penalties for statutory offences such as carrying on an unlicensed money-lending business. It also provides that any loan made by an unlicensed money lender shall not be recoverable by court action. With certain exceptions (primarily authorised institutions under the Banking Ordinance), any person, whether a licensed money lender or not, who lends or offers to lend money at an interest rate exceeding 60 per cent per annum commits an offence. Any agreement for the repayment of any such loan, or security given in respect of such a loan, is unenforceable.

Bankruptcies and Compulsory Winding-up

The Official Receiver's Office administers the estates of individual bankrupts and companies ordered to be compulsorily wound up by the High Court. Once a receiving order is made against the property of an individual debtor or a winding-up order against a company by the High Court, the Official Receiver becomes the interim receiver or provisional liquidator of the debtor or company, respectively. In most cases, the Official Receiver is appointed trustee or liquidator either by a summary procedure order, where the assets of an estate do not exceed $200,000, or by a meeting of creditors in bankruptcy, and meetings of creditors and contributories in compulsory liquidation.

When he acts as trustee or liquidator the Official Receiver investigates the affairs of the bankrupt or the wound-up company, realises assets and distributes dividends to creditors. The Official Receiver also prosecutes certain offences set out in the Bankruptcy and Companies Ordinances, applies for disqualification of company directors, supervises the work of outside liquidators and trustees, and monitors the funds held by liquidators in compulsory and voluntary liquidations.

The Bankruptcy (Amendment) Bill 1996 was introduced into the Legislative Council during the year. The purpose of the Bill was to rationalise and update the statutory framework for personal insolvency based upon recommendations of the Law Reform Commission. The main changes included abolishing the outdated concept of 'acts of bankruptcy', providing for automatic discharge for bankrupts after a certain period and for new voluntary arrangements to encourage debtors to resolve their problems without having to become bankrupt, and substantially simplifying procedures under the ordinance.

During the year, the High Court made 543 receiving orders and 557 winding-up orders. The assets realised by the Official Receiver during 1996 amounted to $113.32 million, while $62.91 million in dividends were paid to creditors in 249 insolvency

cases.

Professional Accountancy

Hong Kong had 11 655 registered professional accountants at the end of 1996. Of these, 2 203 were certified public accountants (CPAs) or public accountants (PAs)