Transcript of remarks by SFST at media session
Reporter: Can you comment on the potential listing of Xiaomi in Hong Kong? Can you explain to the potential investors whether their protection will be limited?
Secretary for Financial Services and the Treasury: "Limited" in what sense?
Reporter: Xiaomi is using a completely new way of listing in Hong Kong, taking advantage of the new rules in Hong Kong Stock Exchange? Whether the protection will be different?
Secretary for Financial Services and the Treasury: The new listing regime, the changes that are introduced cater for both primary listing and secondary listing. So, you can say that the corporate governance, the protection and safeguards, as what we call them, are the same and applicable to Xiaomi or others. There are no particular sort of customised restrictions or rules that govern Xiaomi which are not applicable to other corporations. But the point is, the regime covering primary and secondary listing allows those with weighted voting rights to come into our market and list on the Hong Kong stock market. Yet, they are on the same level playing field. So, they are all subject to the same safeguards. As I explained it in Chinese just now, because of the disclosure and the way that the Corporate Governance Committee, which will comprise all independent non-executive directors, they are the ones who will be keeping a watchful eye on the overall governance of the corporation. If there were any cases whereby say, the board acting against the interests of the corporation in general or the retail investors, the Corporate Governance Committee can make recommendations and the board will have to act upon the recommendations. If they do not comply, they will need to explain why they are not complying with the recommendations of the Corporate Governance Committee. So, those are pretty powerful tools. Also for those with weighted voting rights, those shareholders are under certain prescribed circumstances that they cannot invoke such rights. They will have the same voting power when it comes to voting on the appointment of non-executive directors or on changes to the articles of association and so forth.
(Please also refer to the Chinese portion of the transcript.)
Ends/Saturday, May 5, 2018
Issued at HKT 11:26
Issued at HKT 11:26