to its January 2005 consultation for as they say “better later than never”.
government should muster the political will to ultimately see the introduction of proposals that it
had first raised some six years ago.
By introducing statutory backing to the
the government would place Hong Kong
on the road to a regime of continuous disclosure thereby advancing its aspiration to be the
“paragon of corporate governance in Asia.”
In doing so, it could possibly justify the deferral of
the more contentious issue of quarterly reporting, thereby saving itself from being embroiled in
the charged debated that surrounded the proposal by the stock exchange to further limit share
trading by directors through enhanced black out periods.
At the outset it should be made unequivocally clear that the author does not condone the actions
of CITIC Pacific Limited and/or its directors in delaying the disclosure of material price sensitive
However, this article is not about judging the conduct of the company or of its
directors but rather about a significant regulatory gap that exists in Hong Kong, which if left
unrectified could have serious ramifications on its status as an international financial centre.
A fundamental pillar that supports the success of the financial markets in Hong Kong is its
universally recognized adherence to and perpetuation of the rule of law.
We set objective and
transparent regulations which are generally enforced without fear or favour.
and intermediaries are attracted to this important facet of Hong Kong and they collectively
contribute towards its continuing development and success.
Despite the lacuna in the regulatory framework
it does not automatically follow that the
directors of CITIC Pacific will escape liability despite the losses incurred by both the company
and its investors.
It comes as no surprise to the author that the matter is now subject to an
investigation by the Commercial Crimes Bureau of the Hong Kong Police Force which on 3
Tsang D., “
Budget Speech 2001-02
” at paragraph 68 available at
Tsang D., “
Governance for the New Generation”