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Report of the Independent Review Committee for the Prevention and Handling of Potential Conflicts of Interests released (with photo/video)

The following is issued on behalf of the Secretariat of the Independent Review Committee for the Prevention and Handling of Potential Conflicts of Interests:

     The Independent Review Committee for the Prevention and Handling of Potential Conflicts of Interests (IRC) has submitted its review report to the Chief Executive and released it to the public today (May 31).

     Speaking at the press conference for the publication of the Report, the Chairman of the IRC, Mr Andrew Li Kwok-nang, said, "A clean government is a core value of our society. The public has the highest expectations that holders of high public offices would observe the highest standards of conduct. A good system is necessary for commanding public confidence in a clean public service and for upholding the dignity and the honour of our highest public offices."

     The IRC has examined the present system for the prevention and handling of potential conflicts of interests concerning the Chief Executive (CE), Non-Official Members of the Executive Council (ExCo) and Officials under the Political Appointment System (PAOs). The Committee has taken full account of the civil service system, which has been improved from time to time in the light of experience and commands public confidence. It also noted the practices in various local public institutions and bodies and in various overseas jurisdictions. The Committee also considered the views from individuals and organisations collected through the public consultation.

     "We have put forward 36 recommendations," Mr Li said. "We believe that, if fully implemented, they would improve the present system and restore public confidence in the system." (The 36 recommendations are listed in the Annex.)

     Mr Li said that the IRC was guided by, among others, the principle that leaders should lead by example. The system applicable to the highest public officials should be at least as stringent as that applicable to those they lead. The system applicable to the CE is a key area in the recommendations. At present, the strict corruption prevention regime under section 3 of the Prevention of Bribery Ordinance (POBO) (Cap 201) applies to PAOs and civil servants, but not to the CE. The CE decides for himself on acceptance of advantages and is not subject to any checks and balances. The IRC considered this a fundamental defect of the present system, and as a result the present system is totally inappropriate. The CE should not be above the law which applies to PAOs and civil servants.

     The IRC recommended that legislation should be enacted to apply section 3 of the POBO to the CE such that the acceptance of any advantage by the CE requires permission of a statutory Independent Committee. The Independent Committee should consist of three members appointed jointly by the Chief Justice of the Court of Final Appeal and the President of the Legislative Council. Members of the Independent Committee should be permanent residents of the Hong Kong Special Administrative Region (HKSAR) and persons of high standing in the community. The process of appointment of the Independent Committee and the process of that Committee giving permission for the acceptance of advantages should not be politicised. If the recommendations are implemented, the regulatory regime governing acceptance of advantages by the CE would be essentially the same as that for PAOs and civil servants.

     On acceptance of entertainment (that is, lunches, dinners and accompanying performances, etc), the IRC considered that the CE should, as with PAOs and civil servants, abide by relevant guidelines. The Committee recommended that the guidelines relating to acceptance of entertainment under the Code for Officials under the Political Appointment System (the PAO Code) should be strengthened. Under the strengthened guidelines, the CE, in deciding whether to accept entertainment, must consider whether having regard to matters such as its lavish or excessive nature, etc, attendance by the CE is likely to lead to a conflict of interest or bring the Government into disrepute, bearing in mind public perception. As the highest political leader of the HKSAR, the CE should set a good example for PAOs and civil servants and should exercise great vigilance in deciding on the acceptance of entertainment. It is appropriate for the CE to follow the maxim "If in doubt, don't".

     As regards PAOs, the regulatory regime applicable to PAOs is largely consistent with that for civil servants. The IRC put forward a number of recommendations including strengthening the guidelines in the PAO Code relating to the acceptance of advantages and entertainment, adopting and publishing guidelines for handling of conflict of interest questions concerning PAOs and guidelines for considering applications from PAOs for special permission to accept advantages. These guidelines should be at least as stringent as those applicable to the civil service. The Committee also recommended that, for transparency, where any PAO has withdrawn from the decision-making process in relation to any matter due to conflict of interest, this fact should be stated as and when the decision concerning that matter is publicly announced by the Administration.

     As regards ExCo, there is in place a system to regulate declaration of interest and conflict of interest concerning ExCo Members. The IRC considered that the transparency of the ExCo declaration system should be enhanced. Without compromising the confidentiality of ExCo deliberations, the CE in Council should publish a document setting out the system it has adopted for dealing with conflict of interest. It should also publish annual statistics of the number of occasions on which one or more Members withdrew from its decision-making process due to conflict of interest.

     The IRC urges the Administration to consider the Report carefully and implement the recommendations as soon as practicable, including the enactment of relevant legislation.

     The Report is publicly available on the IRC's website (

     The CE announced on February 26 the setting up of the IRC, chaired by Mr Li and comprising four other members, Mr Lawrence Fung, Professor Liu Pak-wai, Mr Thomas Brian Stevenson and Mr Stephen Yau. The terms of reference of the IRC are:

(a) to review the existing regulatory frameworks and procedures for the prevention and handling of potential conflicts of interests concerning the Chief Executive, Non-Official Members of the Executive Council and Officials under the Political Appointment System, including the arrangements for declaration of investments/interests and acceptance of advantages/entertainment/hospitality;

(b) in light of the review, to make recommendations on the existing frameworks and procedures, including changes and revisions where appropriate; and

(c) to submit a report with recommendations to the Chief Executive within three months.

Ends/Thursday, May 31, 2012
Issued at HKT 16:28


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