Beijing liaison office denies report of renting out staff housing for profit, threatens to sue Hong Kong newspaper for ‘distorting facts’
- Central government’s office, which is exempt from stamp duties, has snapped up more than 280 residential properties
- Official says all flats are used as offices and dormitories, warns legal action against ‘hostile defamation’
Beijing’s liaison office in Hong Kong denied on Monday it had rented out flats it bought in the city for profit and warned of taking legal action over a media report that suggested it had abused the exemption it enjoys on stamp duty payment.
The office was responding to a report by Apple Daily, a Chinese language newspaper, that two of the flats it bought via its company in Sai Wan were rented out instead of being used as staff quarters.
The office owns more than 280 properties in the city, including the 20 flats it bought last week at Grand Central in Kwun Tong for HK$247.5 million (US$31.5 million).
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Apple Daily quoted a tenant at the flat at The Merton that she and her family had no links to the liaison office. The original owner of the other home at Cheung Ling Mansion told the paper the flat was still rented out to his former tenant who was there when he sold the property in 2017.
The two flats are currently owned by Newman Investment – whose five directors are officials of the liaison office.
Under the Stamp Duty Ordinance, the central government, or any “incorporated public officer or any person acting in his capacity as a public officer shall not be liable for the payment of stamp duty”.
This means the liaison office or its associated companies are exempted from paying a 15 per cent buyers’ tax on home purchases and another 15 per cent levy on the purchase of second homes.
Speaking in Beijing, Chen Dong, a deputy director of the liaison office, said the report by Apple Daily on Monday was “distorting facts”.
“[The flats are] for our own residential needs,” Chen said. “You [reporters] should go and find out the truth.”
Chen declined to respond further when asked what part of the news report was distorted and if all the properties owned by the liaison office were for housing.
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In a separate interview with the Hong Kong China News Agency, an official from the liaison office also “strongly condemned the ill-founded report in disregard of the facts”.
The official, who was not named, said the liaison office had never leased or resold its properties for profit, and ones it owned were eligible for the tax exemption because they were used as offices and dormitories.
He added that all the 14 flats they owned at The Merton were staff quarters.
“Some residents didn’t disclose where they work or the use of the property because they were cautious and concerned for their own safety when some reporters visited their homes with cameras at night without declaring their real identities,” the official said.
The officer added that the liaison office reserved the right to pursue legal liability against those involved in the “hostile defamation”.
The official did not respond to the case in Cheung Ling Mansion.
Ryan Law Wai-kwong, editor-in-chief of Apple Daily, said Newman’s purchase of local properties concerned the public interest and it was normal for news media to report on it.
“I hope the liaison office and the Hong Kong government can release to the public all relevant information before they resort to other irrelevant actions,” Law said.
Democratic Party lawmaker James To Kun-sun urged Hong Kong’s leader to report to the central government and request a review on the liaison office’s staffing.
“The tax exemption is equivalent to helping the liaison office compete against local residents in the property market,” To said.
To also urged the Hong Kong government to clarify whether Newman’s five directors were holding the company as individuals, or as state representatives. “If the company has been using public money, the flats should be owned by the state instead of being held by a private company,” To said.
The liaison office did not respond to inquiries from the Post.