Former Hong Kong leader CY Leung denies conflict of interest over ‘Belt and Road’ company directorship

Former chief executive found to have been director of two companies related to different mainland development plans

PUBLISHED : Tuesday, 12 September, 2017, 10:01pm
UPDATED : Wednesday, 13 September, 2017, 6:49pm

Former Hong Kong leader Leung Chun-ying was found to have been a director of two companies related to mainland development plans since last month, but denied claims of a conflict of interest, saying the roles were unpaid and the companies were non-profit-making.

The government responded late on Tuesday late night that Leung had informed the authorities on September 11, the same day news portal HK01 broke the story and 11 days after he took up the directorship. The government is processing the case, the spokesperson added.

The companies were related to, and named after, the “Belt and Road” and “Greater Bay Area” schemes.

As chief executive, Leung helped promote both, which one legislator said could have meant Leung was boosting the companies’ future interests whilst city leader.

Leung’s office said on Tuesday night that the companies were non-profit-making and he was not paid for the roles.

“Mr Leung’s roles and activities in the two organisations will be conducted in accordance with government regulations,” its statement read.

But Leung did not make clear if he reported his new posts to the advisory committee on post-office employment for former chief executives, as is required.

The Beijing government’s “Belt and Road” project is a trade initiative spanning two international sea and land routes. The “Greater Bay Area” is a plan to integrate 11 cities in the Pearl River Delta region, including Hong Kong and Macau.

According to information from the Companies Registry, the two companies concerned are Belt and Road Hong Kong Centre Company Limited and Bay Area Hong Kong Centre Company Limited.

Both were founded by lawyer Peter Sit Kien-ping on May 19 this year with Leung Ping-chiu – a partner at Sit’s firm – the first director. They used their firm’s address at The Landmark, in Central.

The companies got their certificates of incorporation on July 6 and July 4 respectively.

On August 31 Leung Chun-ying, who stepped down as chief executive on June 30, was appointed director of both companies. Leung Ping-chiu quit on the same day.

Sit helped the former city leader with legal services during his term, sending letters to the press over reports about his past business dealings that he claimed were defamatory.

Asked about the firms and whether they were Leung Chun-ying’s initiatives, Sit said: “I have to respect the duty of confidentiality ... I cannot discuss clients’ affairs.”

According to the guidance note for the advisory committee on post-office employment for former chief executives and politically appointed officials, former chief executives are subject to a control period of three years.

During the first year, according to the guidelines, a former chief executive “shall not commence any employment (on either full-time or part-time basis), become a director or a partner in any business or profession, or start any business or profession on his own account or with others”.

That rule is unlikely to trouble Leung, if the roles were unpaid and the companies non-profit-making. But former chiefs are still meant to tell the government of any appointment they accept during the control period, paid or otherwise.

The advisory committee did not respond as to whether Leung told it about the appointments.

Democratic Party legislator Lam Cheuk-ting said Leung may have broken the rules. He said he doubted Leung had informed the committee, members of which are appointed by the chief executive.

Lam said Leung, also a vice-chairman of the Chinese People’s Political Consultative Conference, the mainland’s top advisory body, could have a serious conflict of interests as director of the companies, as he was believed to have confidential information on national developments that could affect the companies’ fortunes.

He suggested Leung’s active promotion of the trade and infrastructure schemes as chief executive was to pave the way for his post-office interests.

The Chief Executive’s Office did not respond to requests for comment.