Hong Kong Exchanges and Clearing plans to buy advertising space in local newspapers to publish its half-year results, despite the fact that its own mandatory requirement on listed companies to place such advertisements finally came to an end last month. Legislators, fund managers and listed companies widely applauded the move by the HKEx, as regulator of listed companies, to end the mandatory publication of results in newspapers and shift to electronic reporting of profits, saying the move would considerably reduce companies' costs. Following an extended debate and lead-time, the requirement that listed companies buy advertising space in at least one Chinese-language and one English-language newspaper to announce their results and make major public statements, came to an end on June 25. Companies now need to put only small notices in the newspapers pointing to full announcements on their own websites and the HKEx website. From December 25, they will need only the online announcements without the notices. The interim step of taking out the smaller advertisements was lobbied for by the Newspaper Society of Hong Kong on the grounds that a survey by the Chinese University showed that 71.6 per cent of respondents got corporate information from newspapers. However, a source at the HKEx said the decision to publish its interim result should not be interpreted as a move to try to restore the mandatory newspaper advertising system. 'However, the exchange agrees the newspapers can be good channels for companies to communicate with their shareholders, particularly the retail investors. 'The exchange will thus encourage but not mandatorily require companies to have newspaper advertisement announcements.' Legislator Sin Chung-kai, economic affairs spokesman for the Democratic Party, supported the HKEx move to publish its result in newspapers and Kelvin Wong Tin-yau, executive director and deputy managing director of Cosco Pacific, said his company would consider following suit. 'As a listed company, the scrapping of the newspaper advertisement rule will save us money and make it easier for overseas investors to get our news. But we are worried that local retail investors may not have access to our news,' Mr Wong said. Hard copy preferred Respondents in a survey who get corporate information from newspapers 71.6%
