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Listing Committee Chairman's Clarification on News Report regarding the Joint Consultation Paper on Listing Regulation

Regulatory
16 Nov 2016

Hong Kong Exchanges and Clearing Limited (HKEX) is issuing this statement on behalf of the Chairman of the Listing Committee of The Stock Exchange of Hong Kong Limited (the Exchange), a wholly-owned subsidiary of HKEX.

The Chairman of the Listing Committee of the Exchange has noted the news report in Bloomberg today (the News Report) in relation to the response by four members of the Listing Committee to the Joint Consultation Paper on Proposed Enhancements to The Stock Exchange of Hong Kong Limited’s Decision-Making and Governance Structure for Listing Regulation (the Consultation Paper).

The Listing Committee has, as a committee, made a submission in response to the Consultation Paper yesterday which, as stated in the submission, represented the majority view of the Listing Committee1 (the Listing Committee Submission).  The Chairman of the Listing Committee wishes to clarify that the position taken by the four members as stated in the News Report represents a minority view.

In the Listing Committee Submission, the Listing Committee recognises that the Hong Kong market changes over time and therefore it is important to review the structure of the regulatory regime periodically to ensure that the regime remains relevant and effective.  While the Listing Committee supports the objectives outlined in the Consultation Paper - greater efficiency, transparency, accountability, and coordination in the regulatory process, it does not believe the outlined changes in the Consultation Paper will achieve this in practice.  Accordingly, the Listing Committee believes that the stated objectives of the Consultation Paper could be better achieved instead through enhancements to the current regulatory regime to ensure a closer and more effective working relationship between the Securities and Futures Commission (the SFC) and the Listing Committee while maintaining the checks and balances that are a hallmark and the Listing Committee believes a key strength of the Hong Kong regime.

The Listing Committee also notes that the Exchange and the SFC are currently engaged in a separate broader review around the Listing Rules and the Growth Enterprise Market (GEM).  The Listing Committee believes this, together with a review of the exercise of the SFC's enforcement powers, should be the priority in addressing the concerns that have been expressed in some quarters around the quality of the Hong Kong market.

The view expressed in the Listing Committee Submission was reached after detailed deliberation amongst all members. 

Stephen Taylor
Chairman
Listing Committee



1 To avoid any conflict of interest, Mr Charles Li (ex-officio member of the Listing Committee, Chief Executive of HKEX) was not involved in the preparation or submission of theListing Committee Submission.

Ends

Updated 16 Nov 2016