MOST Hong Kong fund managers are in favour of banning commission rebates and regulating soft dollar commissions. Almost two thirds (64.7 per cent) of Hong Kong Investment Funds Association (HKIFA) members, who responded to a survey by the body, expressed approval of Securities and Futures Commission (SFC) proposals to ban the controversial practice of accepting cash rebates on share deal commissions from brokers. And 91.2 per cent said so-called soft dollar deals should be allowed only if the goods received benefited clients, that the best terms were satisfied and adequate disclosure was made. The issue of banning commission rebates has caused a bitter split in the HKIFA with a public slanging match erupting between two of Hong Kong's biggest fund managers - Jardine Fleming and Fidelity - who are on opposite sides of the rebate divide. The HKIFA survey has come as a blow to supporters of rebates. The survey will be handed to the SFC and will add ammunition to the regulator's campaign to have rebates outlawed. The survey was conducted after Business Post attempted to survey HKIFA members and Richard Haw, chairman of the body, wrote to members urging them not to reply because reponses might have highlighted conflicts or divided opinion on the subject. ''From a public relations point of view it would be a disservice to the industry by aggravating the differences,'' wrote Mr Haw. The HKIFA said it had carried out the survey as part of the SFC's consultative process and received replies from 34 out of 42 member companies. The survey was carried out on the basis of one member, one vote. The chief findings were: That 64.7 per cent of respondents were in favour of banning rebates with 21 per cent against. Fourteen per cent were indifferent. Respondents were split on whether there was a difference between cash rebates and soft dollar commissions. About 41.2 per cent said there were not - the two were materially the same, but dressed differently. But half said they were materially different as rebates were a straight fee split, while soft dollar commissions were an opportunity to negotiate charge reductions with brokers. That 64.7 per cent said it was fair to ban rebates and leave soft dollar commissions as long as there was adequate disclosure. Richard Wastcoat, regional marketing director at Fidelity, welcomed the findings. ''We think the survey shows a very good representation of industry views,'' he said. ''Clearly, a majority of members are in favour of banning rebates and greater disclosure of soft dollar [commissions].'' Chris Russell, director of Jardine Fleming Holdings, said he was not surprised by the findings. ''If 75 per cent of members have a vested interest in banning rebates because they are from overseas, how surprised are you at the survey's findings?'' he said. Mr Russell pointed out that many respondents had only small sums under management compared with the might of the group of giants and that the survey did not reflect this. ''If the survey was done on the basis of funds under management, the answer would be different - the message is the industry is split,'' he said. The next step for all the companies concerned and for the HKIFA is to write to the SFC. ''The HKIFA has a completely neutral stance,'' said an HKIFA spokesman. ''We will relay what our members think to the SFC.''