Fixing the Small House Policy
We look at a recent court case which again highlights the rampant abuse of the Small House Policy for the New Territories. We propose a return to the original policy intent, creating an internal market for indigenous housing, together with a voluntary, market-based scheme to surrender the claims of indigenous men and their under-age and unborn male descendants. (9-Sep-2014)
HKT's abuse of ID numbers
Your ID number is not a password; so many firms and people know your identity - but dominant land-line provider HKT Ltd (6823) is using it that way to access your phone bills. HKT: Here to Cut Corners. (9-Sep-2014)
PCPD not answering our calls
After blogging about parts of an "intemperate grilling" from the Commerce and Economic Development Bureau over his call for a do-not-call person-to-person register, igniting public debate, the Privacy Commissioner has now refused our request, under the Code on Access to Information, for copies of the CEDB's letter and his reply letter, citing a lack of public interest. He can't have it both ways. (5-Sep-2014)
ISS recommends against Lerado (1225) sale
Webb-site has learned that ISS, the leading proxy advisory firm, has joined us in recommending voting against the sale of Lerado's core business, due to the excessive capital retention. (4-Sep-2014)
Veto Lerado (1225) sale until they pay up
We call on Lerado shareholders to veto the sale of its core business unless and until the board increased the proposed special dividend from $0.30 to at least HK$1 per share. We would rather hold a stake in a real business than get trapped in another shell trading at a discount to its net cash. Management only owns 33%, so they had better listen to investors and revise the plan. David Webb holds just under 8%, and we need your support. (1-Sep-2014)
Guangdong Yueyun bonus share vetoed
H-share holders have narrowly vetoed a bonus share issue by Guangdong Yueyun (3399) which would have knocked 40% off the dividend in additional tax and destroyed 1.5% of value for H-share investors. This is the board's idea of "providing returns to shareholders". (30-Jun-2014)
Minsheng tax grab, HKEx conflicts
Minsheng Bank (1988) just grabbed RMB115.6m from H-share holders and paid it to the Government with no good reason. We explain why bonus share issues by PRC issuers are not just silly but damaging to shareholder value. We also look at the conflict of interest for HKEx, which recently signed a strategic MoU with Minsheng and is pursuing relationships with other banks while acting as their listing regulator. The SFC should now take over regulation of these listings, but has declined to do so. (30-Jun-2014)
The right to remember
In the wake of ECJ's Google v Spain ruling, we publish a letter from the UK Information Commissioner regarding the sanctity of newspaper archives, and then look at the unintended and dangerous consequences of the ECJ's ruling. You really don't have a right to make other people forget, and you do have a right to remember. (20-Jun-2014)
Citibank's response on vote-stuffing
Citibank has responded in a most disappointing way to yesterday's article, in essence shrugging its corporate shoulders and claiming to be just following instructions. That is not an excuse in the money-laundering arena, and it won't wash in the corporate governance arena either. (19-Jun-2014)
Citibank vote-stuffing in HK AGMs
Webb-site has discovered that Citibank has been tilting the outcome of shareholder meetings in HK by giving blank proxies to management-nominated voters on behalf of Taiwan Depositary Receipts for which it has no voting instructions. We call on Citibank to stop this outrageous practice and on the HKMA and SFC to ensure that the HK branch does so. (18-Jun-2014)
Yorkey (2788) AGM recording
Note: in this AGM, David Webb incorrectly stated that the threshold to requisition a general meeting is 25%; in fact Yorkey's articles have a threshold of 10%. He again called for the board to make a special distribution of the surplus cash, failing which he would take steps to try to change the board to one which would do the job. (11-Jun-2014)
Rafael Hui admits in corruption trial that he evaded taxes on 'fees'.
South China Morning Post, 20-Sep-2014
SCMP does not mention that under s82 of the Inland Revenue Ordinance, any person who wilfully with intent to evade tax omits from a return any sum which should be included is liable on indictment to up to 3 years in jail and a fine of up to 3x the tax evaded. In Mr Hui's case, the fine would not have much effect because he is already bankrupt - but he appears to have opened himself up to another prosecution.
Dragonite (0329) subscribes 2.52% of HEC Capital Ltd for HK$137.5m
Company announcement, 16-Sep-2014
Dragonite and HEC Capital are members of what we call the "Chung Nam Network". On 21-Jan-2014, Dragonite sold the basement of China United Centre to a company that is or was owned by HEC Capital for HK$140m, almost the same amount it has injected into HEC Capital in today's deal.
HKEx signs MoU with CCB (0939)
Company media release, 15-Sep-2014
This MoU, for "strategic cooperation" again puts HKEx into a conflict of interest with its role as listing regulator of CCB, as it has done with China Minsheng Banking (1988). The SFC should take over as listing regulator of both banks.
SFC launches proceedings against CITIC (0267), its former Chairman and executive directors
The SFC completed its investigation by 2010, but with the 6-year limit for civil action expiring tomorrow, it probably could not wait any longer for the DoJ to prosecute, so it is taking the civil route via the MMT, and more importantly for investors, it is seeking restoration for those who bought the shares during the period between the alleged false statement on 12-Sep-2008 and the revelation of the FX losses on 20-Oct-2008. Sadly there appears to be no remedy for those who already held the shares on 12-Sep-2008 and relied on the statement in continuing to hold them.
HK Sheng Kung Hui v Inland Revenue
HK Court of Appeal, 11-Sep-2014
The Anglican church battles over the tax it has to pay on the profits from developing its former orphanage site into Deerhill Bay, Tai Po, with Cheung Kong (0001), on which the church made a pre-tax profit of HK$1.12bn.
T v Commissioner of Police: Dancing in the Street.
HK Court of Final Appeal, 10-Sep-2014
By a 3:2 majority, the Commissioner of Police loses his appeal; dancing in the street during a public procession does not require a licence under the Places Of Public Entertainment (POPE) Ordinance. Mick Jagger and David Bowie will be grateful for that clarification (as will Martha and the Vandellas). A narrow victory for common sense.
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Today's birthdays, 21 September
From Webb-site Who's Who
|Plantagenet, Richard (1411)
|Seymour, Edward (1561)
|Byng, George (1701)
|Cecil, Brownlow (1725)
|Byng, Isabella Elizabeth
|Mozart, Karl Thomas
|Seymour, Francis Edward
|Lampson, Curtis Miranda
|Hughes-Hallett, Ada Edith Mabel
|Manners, John Henry Montaqu
|Wong, King Fai (1892)
|Mok, Yee Moy
|Silke, William James
|Liu, Lit For (1930)
|Bingham, George Charles (1967)
|Boakes, Richard Anthony