THE stock exchange is looking seriously at amending listing rules to accommodate depositary receipts by foreign companies. 'We are studying the issue and hope to submit to the listing committee a report on it,' said exchange executive director and listing division head Herbert Hui Ho-ming. He gave no date for completion of the study into latest move for more Hong Kong listings for overseas concerns now limited to primary and secondary listings. Compared with the mature markets of New York and London, Mr Hui said the exchange had lagged behind in listing despositary receipts. He said the exchange had recently improved procedures for overseas companies, especially those seeking a secondary listing. 'Soon, if preparations continue to proceed apace, overseas issuers will have the choice of listing despositary receipts rather than actual shares, which will enhance trading ease in the equity of foreign issuers in Hong Kong,' he said. Although Mr Hui dismissed the suggestion that the move was targeted at Chinese state-owned enterprises listed beyond Hong Kong, the market has been buzzing with talk that the mainland concerns listed in New York will also seek a listing in the territory to make up for sluggish trade in the United States. Two mainland power companies are listed in New York in the form of despositary receipts and three more plans to follow. Mr Hui said Hong Kong's attraction for overseas issuers could be attributed to three factors. 'First, Hong Kong is one of the most highly regarded stock market in the region' in terms of regulation, openness, liquidity and the quality of companies listed, he said. Hong Kong's unique relationship with and geographical proximity to China made it the natural listing venue for companies with assets or business interests on the mainland. In addition, Hong Kong was one of Asia's most dynamic and sophisticated financial and consumer markets, appropriate for those seeking a diversified shareholder base. However, he conceded that trade in secondary listed stocks in Hong Kong was far from active and the exchange was mulling over measures to stimulate this sector. While proud of Hong Kong's role as a host for mainland company flotations, Mr Hui said the exchange should not be too dependent on Chinese listings and it should maintain the integrity of its regulatory framework. 'Hong Kong can facilitate the trading of Chinese shares not listed in the territory but has to make sure that the listing rules will not be undermined,' he said.