Press Release
Consultation starts to seek views on proposals to enhance regulation of listing
October 3, 2003
The Administration published a consultation paper to invite public views on the enhancement of regulation of listing.
The consultation exercise is to follow up the recommendations of the Expert Group to Review the Operation of the Securities and Futures Market Regulatory Structure.
Announcing the commencement of the consultation exercise, the Secretary for Financial Services and the Treasury, Mr Frederick Ma said: "To further enhance Hong Kong's status and competitiveness as an international financial centre and the premier capital formation centre for the Mainland, we must continue to upgrade our market quality by improving the listing regime.
"In considering possible measures to bring the current regulatory regime in line with international standards, we will also take into account market development needs and local circumstances.
"By actively engaging the market, we hope to develop in partnership with market participants the most effective means to improve the listing regime," he said.
Public views are sought on proposals to give statutory backing to certain fundamental listing requirements. Views are also invited on ways to improve the regulatory structure governing the performance of listing functions. Based on the public views expressed so far, the Consultation Paper outlines four alternative regulatory models to facilitate public discussion.
"We hope the Consultation Paper will help promote understanding of and deliberations on the major issues involved in the regulation of listing matters, with a view to arriving at a set of specific measures which are suitable for Hong Kong's circumstances and in line with international standards," Mr Ma said.
"We will consider carefully the public views received during the consultation, and work closely with the Securities and Futures Commission and Hong Kong Exchanges and Clearing Limited to draw up improvement measures which are effective and feasible."
The Consultation Paper can be downloaded from the website of the Financial Services and Treasury Bureau at http://www.info.gov.hk/fstb/fsb/consult/erl.htm. The consultation period ends on December 31, 2003.
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Following is a summary of major issues under consultation:
Proposal for Giving Statutory Backing to Certain Fundamental Listing Requirements
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Statutorily-backed listing requirements could create positive obligations for compliance, enhance effectiveness of investigation and provide a wider range of statutory sanctions to be imposed on proven breaches which are commensurate with the seriousness of breaches. They will strengthen the enforcement of these listing requirements and bring the regulatory regime in respect of listing matters in line with international standards.
Views are sought on -
* which fundamental listing requirements should be given statutory backing;
* how statutory backing should be best achieved through a balanced mix of instruments in the primary legislation, subsidiary legislation and non-statutory codes and guidelines; and
* the range of sanctions, in particular civil sanctions, that should be introduced for breaches of statutory listing requirements.
Regulatory Structure Governing the Performance of Listing Functions
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To facilitate public discussion on possible improvements to the regulatory structure governing the performance of listing functions, the consultation paper outlines four alternative models for consideration by the public -
1. Transferring listing functions to SFC;
2. Transferring listing functions to a new HKEx subsidiary;
3. Transferring listing functions to a new statutory independent authority;
4. Expanding the current "dual filing" system.
The models are by no means exhaustive.