Tribunal proposed to handle non-disclosure by listed firms

Listed Hong Kong companies that fail to disclose price-sensitive information to the market should be dealt with by a government-appointed tribunal rather than face criminal charges in court, says the head of the Chamber of Hong Kong Listed Companies.

Chairman Lo Ka-shui said that 'criminal courts need to prove a case beyond reasonable doubt. In cases of non-disclosure it is difficult to produce such a level of evidence and turning non-disclosure into a criminal offence is going too far'.

A body similar to the Insider Dealing Tribunal that accepts a lower level of evidence than is required in a criminal case would be more effective than a government proposal to make non-disclosure of price-sensitive information under listing rules a criminal offence, Mr Lo said.

The Financial Services and the Treasury Bureau said in March it planned to consult the market at the end of this year on whether it should give rules relating to the disclosure of price-sensitive information statutory backing under the law.

This will mean that breaches of the rules will face a range of actions by the Securities and Futures Commission including bringing the case to be heard in criminal courts.

Paul Chan Mo-po, legislator for the accountancy sector, said such statutory backing was necessary to enhance market transparency to protect investors.