Hong Kong urges timely disclosure as numbers of missing company chairmen rise
Hong Kong’s top financial official on Wednesday urged listed companies to disclose inside information in a timely manner, including information about its officers following a rising number of those whose senior executives are reported missing.
Chan Ka-keung, Secretary for Financial Services and the Treasury, gave those remarks in reply to a question raised by Christopher Cheung, a member of the Hong Kong Legislative Council.
Cheung had asked whether the Securities and Futures Commission (SFC) required listed companies must publish an announcement within a certain period of time after their chairmen or principal officers are missing or out of contact, and if the SFC would conduct a review over the regulation.
Cheung put in the enquiry after Guotai Junan International, a Hong Kong listed arm of mainland based Guotai Junan Securities, reported their chairman Yim Fung as missing in a filing to the Hong Kong stock exchange on November 23 of last year.
Yim reappeared in late December, after “assisting” mainland authorities in an investigation, the company said in another filing to the Hong Kong stock exchange on December 23.
In his reply, Chan said the Securities and Futures Ordinance has a specific definition, requirement, and exception over inside information disclosures, without saying any review on the regulation is needed.
Inside information include those about the corporation, its shareholders or officers or its listed securities or their derivatives, he noted.
“Where SFC considers that there appears to be is a delay in disclosing inside information, it will take appropriate action to promote compliance and enforce the relevant disclosure requirements, which may include making enquiries of the relevant listed corporation, issuing a guidance letter or, in very serious cases, taking enforcement action,” Chan said.
A rising number of Hong Kong listed companies recently saw their chairmen go missing or out of contact, as the mainland Chinese government steps up anti-corruption investigations in the finance sector.
Chan said the SFC and the Stock Exchange of Hong Kong does not maintain specific statistics on missing or uncontactable chairmen or top officers of listed corporations.
An example of recent cases is Imagi, a Hong Kong-listed animation studio which said in a filing to the exchange on December 17 that it cannot reach its chairman Shan Jiuliang since October 15. Shan has been involved in a fraud scandal in mainland China.
On December 10, media reported as missing Guo Guangchang, controller of Hong Kong listed conglomerate Fosun International. The company waited for 30 hours before filing to the Hong Kong bourse on December 11, saying Guo had been assisting an investigation by mainland Chinese authorities.