Exchange may allow firms to publish brief announcements

PUBLISHED : Thursday, 15 April, 2004, 12:00am
UPDATED : Thursday, 15 April, 2004, 12:00am

Main board-listed firms may only need to publish a summarised version of their announcements through newspaper advertisements, a change that might spark fears of limiting information to Hong Kong's one million retail investors.

A source close to the stock exchange listing committee said the proposal would be discussed at the group's quarterly meeting on Monday.

'After a two-year debate by the exchange staff and market participants, the current proposal is a compromise after taking into account the interests of listed companies, investors and newspapers,' the source said.

A Hong Kong broker said, however, that a summarised version of announcements in newspapers was not good enough as they may not disclose full details to investors.

'The HKEx is trying to enhance market transparency and it should not bring in a rule that may lead to retail investors getting less information than institutional investors, who could read a full version of announcements via the internet.'

An HKEx spokesman yesterday said he could not comment on listing committee's agenda for the meeting.

The exchange in April 2001 first proposed allowing companies to issue their announcements through the HKEx web site. Companies at present must publish results, share placements and other corporate announcements in paid advertisements in at least one Chinese-language and one English-language newspaper.

The plan was shelved in December 2002 after market participants raised concerns that many retail investors did not have computers.

The source said exchange executives recently concluded that the listing committee should look into the issue again.

'It has been an international trend that most overseas exchanges no longer require companies to publish announcements in newspapers, and Hong Kong is the remaining market still having this rule,' the source said.

limited disclosure

Announcement proposal follows two years of debate

Participants fear that not all retail investors have computers

Most overseas exchanges have dropped the requirement