Proposals attempt to simplify territory's company law system

Proposed reforms to Hong Kong's company law would streamline and simplify an increasingly complex and unwieldy system, Cally Jordan, a leading advocate for change, says.

Ms Jordan, who with Ermanno Pascutto headed the two-year $15 million review of the Companies Ordinance, told the American Chamber of Commerce they had recommended a 'core company law' approach along North American lines.

'Capital markets regulation, insolvency, [and] the creation of personal property interests would all be disassociated from company law, where they have traditionally found their home in United Kingdom-style legislation,' she said.

The review was commissioned by former financial secretary Sir Hamish Macleod in November 1994.

Critics of the proposals have claimed the review has 'cherry picked' best practice without developing a coherent, Hong Kong strategy.

'Nearly 90 per cent of Hong Kong incorporated companies are private,' Ms Jordan said. 'Shareholders in these companies would be able to dispense with the now mandatory audit of financials.' One of the aims of the review is to make launching and running a company as simple as in any competing commercial jurisdiction.