Directors face stiffer law
TOUGHER rules for company directors will be gazetted today, bringing Hongkong provisions for disqualifying errant directors in line with Britain's.
After the changes to the Companies Ordinance, the Financial Secretary will be able to apply to disqualify a director if it appears in the public interest following an investigation.
Under the current law, applications for disqualification can be made following conviction for an indictable offence, after persistent breaches of the Companies Ordinance or for fraudulent trading uncovered during a liquidation.
From today, the High Court will be required to disqualify directors of companies that have gone insolvent from holding directorships or taking part in management for a year if, in the court's opinion, it is in the public interest.
Britain changed its law in this area in 1986. The Hongkong Companies Ordinance was based on British legislation passed in 1981 and 1978.