THE search to find a successor for Robert Nottle as the chairman of the Securities and Futures Commission is now underway. The world, we are told, will be scoured. We hope that is correct. A local appointee would be an ideal choice, but the position, which will be one of the most critical public appointments in the run-up to 1997, requires above all else, the most qualified person. Whether chosen from among SFC staff, the local finance industry or even appointing an experienced overseas regulator, any notion of positive discrimination should be avoided. The success of the SFC since its formation in 1989 has been due to the professionalism and strong government support. In the days ahead, its role is going to be even more critical, given the market's rapid transformation. Unlike its early years, when regulatory structures were erected for market surveillance, the SFC is now moving towards a situation that requires incremental fine-tuning and increased enforcement. The evolution of derivative products which add massively to the level of risk individual companies and investors expose themselves to will require careful scrutiny if Hong Kong's penchant for over-shooting any new money-making methods is not to be abused. Also, the further integration of Chinese companies into the local market will require a strong regulatory hand if financial reporting and disclosure standards are to be maintained. Any signal that the appointment may be held hostage to political interests will send a message that the regulatory tide, and hence the rule of law in the territory's financial industry, has turned.TO say that the 1994 land sales programme was a deliberate act by the Government to mislead the public about land supply may be an overstatement. But land officials have certainly shown a lack of initiative in addressing the public's concern over property. Yesterday's revelation that the total floor area of flats that can be built is not ''significantly higher'' than last year is alarming. This is despite all the high hopes of a significant rise in new residential units raised by British team leader Tony Eason after the Sino-British Land Commission meeting on Friday. With a 23 per cent jump in land for residential use, he could be forgiven for expecting the market ''to see this as a sign of positive steps to inject additional supply into the market''. Yet, with only a marginally higher supply of buildable area, some critics pointed to the Government's apparent lack of real effort to reduce Hong Kong property prices. However, it seems the Government's false promise is due more to bureaucratic inefficiency than anything sinister. The Principal Government Land Agent Jim Hughes should be trusted when he stressed that the sales programme was worked out before the Government decided to find measures to cool the market. It was not uncommon in the past for land officials to be slow to respond to market conditions, and there is no reason for them to be otherwise now. It is perhaps fair to say that the land officials are at least six months behind the market in forming land supply policy.