HK signs Islamic Finance Agreement with Dubai

It has been discussed that the Hong Kong delegation visited Dubai to further strengthening economic and political ties between the two financial jurisdictions.

A joint regulatory initiative to enhance access to Islamic financial products in Hong Kong and the Dubai International Financial Centre (DIFC) has been announced by the Hong Kong Securities and Futures Commission (SFC) and the Dubai Financial Services Authority (DFSA).

The initiative was announced on April 3, 2008. It comes in the context of a Memorandum of Understanding between the 2 regulators that was recently signed in Hong Kong. The Memorandum outlines a commitment from two financial centres to enhance mutual co-operation, to promote and develop their respective Islamic capital market segments, and to work together on the distribution of Islamic funds in Hong Kong and the Dubai International Financial Centre.

The Memorandum of Understanding was signed by the Chief Executive of the SFC, Martin Wheatley, and the Chief Executive of the DFSA, David Knott, in the presence of the Financial Secretary of Hong Kong, John Tsang, the Chairman of the SFC, Eddy Fong, and the Chairman of the DFSA, Abdullah Saleh.

It should be noted that the signing of the Memorandum coincided with a number of meetings and engagements of the DFSA Board with senior members of government, regulatory agencies and the financial services industry in Hong Kong and Beijing.

Filed under: HK as a Financial Centre

HK Government launches consultation on HK Companies Ordinance review

The government of Hong Kong has launched a 3-month consultation on the Hong Kong Companies Ordinance review. This step is one of the measures aimed at improving provisions on company names, corporate directorship, registration of charges, and directors’ duties.

Initiated by the the Financial Services & the Treasury Bureau, the consultation is the 2nd of a series in the Companies Ordinance rewrite process.

As regards company names, the Financial Services & the Treasury Bureau has proposed to empower the Registrar of Companies to act on a court order to direct a defendant company to change its infringing name. The Bureau also has proposed to consider substituting the name of a non-compliant defendant company’s with its registration number in order to tackle possible abuse of the company name registration regime.

The consultation paper launched by the government proposes to consider whether the directors’ general duties should be codified so that they would be more accessible to the public.

Abolishing corporate directorship altogether or following the UK approach in this area has also been proposed by the Bureau.

The consultation document issued by the government recommends to update the list of registerable charges. This is aimed to improve the procedure for registration of charges by means of making the instrument of charge fully available on the public register. Also, the registration period is proposed to be shortened from 5 weeks to 21 days.

The Financial Services & the Treasury Bureau has revealed that another consultation regarding capital maintenance rules, share capital, and statutory amalgamation procedures will be conducted in the middle of year 2008.

Filed under: HK Law changes

HKMA is leading Asian Banking Regulator

On March 16, 2008, the Hong Kong Monetary Authority (HKMA) was given the Asian Banker Award for Achievement in Regulation in the Financial Services Industry 2007.

Organised by the Asian Banker magazine since 2005, the annual Asian Banker Achievement Awards programme recognises excellence in the financial services industry. The award was based on a rigorous selection process chaired by Chairman of Dubai International Financial Centre Authority, David Eldon.

It should be noted that the award gives recognition to the professionalism and diligence of the staff of the Authority.

Asian Banker stated that, being led by Chief Executive, Mr Joseph Yam, “the HKMA has become a world class regulator that has helped Hong Kong establish its position as a highly respected and sophisticated regional financial hub".  It also noted the following: "The HKMA was viewed as the clear leader as the region’s most active regulator in supervising its banks in terms of active, on-the-ground issues. It is also the regional regulator that has the best understanding of using modern supervisory techniques to bridge the gap between big-picture macro issues and finer operational issues".

Filed under: HK as a Financial Centre