News

1 Company, 3 Chairmen
Company announcement, 14-Nov-2019
There are 2 possibilities here: 1: Hydoo (1396) has come up with an entirely new and better way of running a board of directors; or 2: they don't have a clue what they are doing. By the way, they also have 2 CEOs, including 1 of the Chairmen. What could possibly go wrong?
Secretary for Justice to visit democracy, promote HK as "dispute resolution" hub
HK Government, 12-Nov-2019
Yes, really. We're so good at resolving our own problems that we want to solve other people's. Teresa Cheng will speak on "The Search for Order within Chaos in the Evolution of ISDS" - which presumably stands for "I'm Such a Disastrous Secretary".
SFC fines UBS HK$400m for overcharging 5,000 wealth management clients HK$200m over 10 years
SFC, 11-Nov-2019
Shocking dishonest behaviour in which they pocketed the difference between a limit order price and a better price obtained in the market for bonds and structured notes. UBS was also fined HK$375m in March for its duff IPO sponsorships.
Judge takes aim at comments by Vice Premier
Webb-site.com, 11-Nov-2019
In continuing the injunction against doxxing with an exception for legitimate news activity, Justice Russell Coleman makes interesting comments on the role of the judiciary and the need for a political solution to the social unrest, which is beyond the scope of the courts.
Arrested tertiary students breaches 700 mark
HK Standard, 9-Nov-2019
Using these data and last year's enrolments from the UGC, Webb-site calculates that an average 0.35% (1 in 289) students have been arrested. HKBU tops the list at 0.80% while HKUST and EdUHK are tied at 0.11%.
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MSCI puts bubble stock ArtGo (3313) into China indexLose your marbles
Company announcement, 8-Nov-2019
Despite Webb-site's bubble warning on 15-Sep-2019, the SFC hasn't followed suit. The stock jumped 40% on Friday. Congratulations MSCI, you've just made it easier for active stock-pickers to outperform your mindless index by excluding ArtGo from their holdings - unless the SFC intervenes before the end of 26-Nov.
Court makes orders against ex-Chairman and EDs of Minth (0425)
SFC, 7-Nov-2019
For an undisclosed connected transaction in 2008 involving a BVI company and his nephew and niece, once again demonstrating how the Stock Exchange allows related parties to hide behind offshore companies whose ownership cannot be traced.
SFC bans Song Baojun for 1 year
SFC, 6-Nov-2019
He effected 4 unit trust trades in 2013 without a client's specific authorisation using incomplete pre-signed forms. We note that in 2014 he went on from HSBC to Dah Sing Bank for 9 months, and was later registered to Hang Seng Bank (an HSBC subsidiary) for just 10 days starting on Christmas Day 2015.
SFC issues restriction notice to Hong Kong Wan Kiu Investment Co Ltd
SFC, 5-Nov-2019
OK now let's not make any childish jokes about the name. We'll have to wait for the SFC's investigation to come to a climax and hope that there is no manipulation involved.
Eminent businesswoman criticizes HK civil service
Global Times, 3-Nov-2019
Where would HK be without the great and unmatched wisdom of Annie Wu Suk Ching?
TVB (0511) v unknown defendants
HK Court of First Instance, 1-Nov-2019
For multiple reasons, Judge Mimmie Chan Mei Lan declines to grant an interim injunction against unknown persons attacking TVB's staff or property.
Central govt plans to 'improve' CE election system
RTHK, 1-Nov-2019
Good. Start by replacing corporate voting with one vote per job, then reallocate the Election Committee sub-sector seats proportionate to registered voters. Voila - a democratic committee! All doable in HK law, no need for NPCSC approval. Do the same for LegCo Functional Constituencies. Or by "improve" do you mean "tighten control over"?
HKEX's Li apologizes after remarks on China and HK
Bloomberg, 1-Nov-2019
To whom? He now says the design of One Country Two Systems is perfect, and it's only a problem of implementation. A bit like the Titanic then.
Court order bans online messages inciting violence
RTHK, 31-Oct-2019
This is getting silly. It is already illegal under common law to incite a crime. The penalty is the same as the underlying crime itself. What is needed is an injunction against people applying for injunctions against crimes. This follows an application 3 days ago by TVB for an injunction against people attacking its staff or property, both of which are offences already.
SFC takes China Medical & Healthcare (0383) and 6 directors to MMT, alleges late disclosure of inside information
SFC, 31-Oct-2019
It took them nearly 6 months to reveal windfall gains on shares of a company which became Alibaba Pictures Group Ltd (1060). The SFC is pursuing the entire board at that time (2014), including 3 INEDs who have since left.
Facilitating shareholder activism in Asia
Webb-site.com, 31-Oct-2019
Webb-site founder David Webb presented at the PNB Corporate Summit in Kuala Lumpur yesterday. In the opening address, Prime Minister Mahathir Mohamad declared that "Government has no business to be in business". That's encouraging, if it means that Malaysia will sell off Government-Linked Companies in a wave of public offers, harnessing market forces to boost growth and shared prosperity.
Re Mark Taylor Simpson QC
HK Court of First Instance, 31-Oct-2019
The liquidators of China Forestry Holdings Co Ltd apply to admit a UK silk to help them sue KPMG, the auditor, for over HK$1.3bn. Acting Chief Judge Jeremy Poon rejects the proposition that Solicitor-Advocates, who now have rights of audience, are an acceptable alternative to junior barristers to assist the QC. The Bar Council sent 2 Senior Counsel and 2 juniors to oppose the application, while the Secretary for Justice supported it. The quasi-trade union wins. Mr Simpson must be assisted by local barristers.
Drill & musketry Sergeant Au Chi Wai charged with bribery, MIPO and deception
ICAC, 25-Oct-2019
He allegedly conned 30 police trainees out of HK$250k. Perhaps the most shocking thing is that they are still teaching musketry.
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Mr Tong Yat Hung and Cheng & Cheng Ltd fined HK$35k and HK$50kTotal returns
HKICPA, 23-Oct-2019
Relating to the 2015 audit of Kiu Hung (0381). We note that shares of only 2 of Cheng & Cheng's 16 current HK-listed audit clients have positive total returns since it was appointed, and only 1 has beaten the HSI.
One Country, Two DisneylandsSecrets of HK Disney-landfill
Bloomberg, 23-Oct-2019
Disney's Iger staying silent on HK protests After NBA's China row. Unmentioned: the fact that in HK, Disneyland is majority-owned by the HK Government and has an option on a huge chunk of idle land that could otherwise be used for housing. Incidentally, Bob Iger confuses air pollution with global warming by saying that he spoke out against Trump withdrawing the US from the Paris climate accords because “if people can’t breathe the air, they’re not going to theme parks.”
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Junior Police Officers' Association v EAC
HK Court of Appeal, 22-Oct-2019
An interim injunction preventing public inspection of names linked to their addresses in the Electoral Register is granted. Validly nominated electoral candidates will still be entitled to the details on their electors.
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Empress Carrie Lam off to Naruhito's enthronement
HK Government, 20-Oct-2019
Under Basic law Article 13, foreign affairs are a matter for the Chinese Government. Still, with the recent Emergency Regulations she has been behaving somewhat like an absolute ruler.
Does your candidate live where you do?
Webb-site.com, 18-Oct-2019
A knee-jerk amendment to the laws on nomination of DC and LegCo candidates goes too far by removing your right to know whether the candidate even lives in your constituency and/or District. We call on LegCo to amend the subsidiary legislation.

Our stories

Judge takes aim at comments by Vice Premier
In continuing the injunction against doxxing with an exception for legitimate news activity, Justice Russell Coleman makes interesting comments on the role of the judiciary and the need for a political solution to the social unrest, which is beyond the scope of the courts. (11-Nov-2019)
Facilitating shareholder activism in Asia
Webb-site founder David Webb presented at the PNB Corporate Summit in Kuala Lumpur yesterday. In the opening address, Prime Minister Mahathir Mohamad declared that "Government has no business to be in business". That's encouraging, if it means that Malaysia will sell off Government-Linked Companies in a wave of public offers, harnessing market forces to boost growth and shared prosperity. (31-Oct-2019)
Does your candidate live where you do?
A knee-jerk amendment to the laws on nomination of DC and LegCo candidates goes too far by removing your right to know whether the candidate even lives in your constituency and/or District. We call on LegCo to amend the subsidiary legislation. (18-Oct-2019)
ERO: one judicial review, two judges
Webb-site has learned that in a very rare move, the Chief Justice has directed that 2 judges sit together in the Court of First Instance to hear the judicial review of the Chief Executive's use of the Emergency Regulations Ordinance. (16-Oct-2019)
A closer look at Maxim's
Recent filings reveal the true profits of Hongkong Caterers Ltd, the 50% owner of Maxim's run by the Wu family, and how they take out a substantial management fee from Maxim's on top of the 50% of profits. We also estimate that about 1 in 7 dollars of HK restaurant receipts go to the Maxim's group. Annie Wu has only a 0.33% stake of HC, although her parents and siblings control an estimated 18.6%. (11-Oct-2019)
Carrie Lam and the separation of powers
After trying to breach the firewall between the 2 Systems with the Extradition Bill, she's at it again, invoking the ERO to enact law by regulation. The PFCR, which she says is subsidiary legislation, sets penalties higher than permitted by Ordinance. Subsidiary legislation cannot override existing Ordinances, so she had better not try. Meanwhile, basic maths and weekend events suggest the anti-mask law fails the rational connection test and is unconstitutional. (8-Oct-2019)
Making laws via the ERO may be unconstitutional
The Basic Law establishes a clear separation of powers between executive and legislative branches. A law that allows the Chief Executive to make laws appears unconstitutional. We expect a judicial review if she tries it. Even if she succeeds, draconian laws don't address the root problem: a deficit in democratic accountability for both the CE and LegCo. We again propose local legislation to scrap corporate voting and democratise the system. (4-Oct-2019)
Lose your marbles
Webb-site issues a bubble warning on marble miner ArtGo (3313), which is up 812% since the end of May and now trades at 24x estimated net tangible assets, making a HK$29bn bubble. (15-Sep-2019)
Avoid: S. Culture (1255)
Webb-site issues a bubble warning on this stock. The Chairman has pledged a majority shareholding to a lender. The loss-making firm is trading at 13 times its net tangible asset value and ownership may be highly concentrated. (15-Sep-2019)
Where can one protest if not near MTR stations?
Police have banned a protest march on HK Island on Sunday, partly because it goes near several MTR stations. Of course, the whole point of Mass Transit is to take people near urban areas. This image shows what a 500 metre no-protest zone around stations on the MTR Island line would look like. (13-Sep-2019)
MTR videos are not Personal Data under PDPO
The MTRC and Police are hiding behind a "personal data" excuse for not releasing videos of the incident in Prince Edward Station on 31-Aug-2019. The law on this is clear: if the video doesn't name the subjects, then it isn't personal data. So said the Court of Appeal in 2000. HK badly needs a Freedom of Information law. (10-Sep-2019)
A curious addition to the Transport Constituency
After yesterday's ICAC allegations of vote-rigging in the I.T. sector, should the Taxi Drivers & Operators Association still be added to the list of Transport sector voters? (6-Sep-2019)
The most likely outcome for HK
A systemically unstable equilibrium of civil liberties without democracy may have irrevocably tipped towards an authoritarian outcome. We suggest a way to salvage the situation, but we consider the most likely outcome is now a crackdown. We look at what form that might take, the possible aftermath and the looming 2047 expiry of Basic Law promises. (3-Sep-2019)
Why Carrie Lam must go
The "suspension" of the Extradition Bill, which will likely lapse in July 2020, is not the end of an increasing erosion of HK's autonomy. With a rubber-stamp legislature, the only thing that now prevents draconian legislation is massive public pressure. Mrs Lam has irrevocably lost the public trust. Beijing will hold her accountable for the loss of control last week, after a suitable interval to disconnect the issues, but this will not prevent the increasing erosion of HK's autonomy. (16-Jun-2019)
The Trump Dump: war-gaming the next move against China
The US Administration has so far focused entirely on the trade account, but when the potential for tariffs is exhausted, if not sooner, Trump may start to wonder why US funds have hundreds of billions of dollars invested in stocks and bonds of Chinese state-backed companies, and use OFAC powers to order them to divest. (2-Jun-2019)

Other news

1 Company, 3 Chairmen
Company announcement, 14-Nov-2019
There are 2 possibilities here: 1: Hydoo (1396) has come up with an entirely new and better way of running a board of directors; or 2: they don't have a clue what they are doing. By the way, they also have 2 CEOs, including 1 of the Chairmen. What could possibly go wrong?
Secretary for Justice to visit democracy, promote HK as "dispute resolution" hub
HK Government, 12-Nov-2019
Yes, really. We're so good at resolving our own problems that we want to solve other people's. Teresa Cheng will speak on "The Search for Order within Chaos in the Evolution of ISDS" - which presumably stands for "I'm Such a Disastrous Secretary".
SFC fines UBS HK$400m for overcharging 5,000 wealth management clients HK$200m over 10 years
SFC, 11-Nov-2019
Shocking dishonest behaviour in which they pocketed the difference between a limit order price and a better price obtained in the market for bonds and structured notes. UBS was also fined HK$375m in March for its duff IPO sponsorships.
Arrested tertiary students breaches 700 mark
HK Standard, 9-Nov-2019
Using these data and last year's enrolments from the UGC, Webb-site calculates that an average 0.35% (1 in 289) students have been arrested. HKBU tops the list at 0.80% while HKUST and EdUHK are tied at 0.11%.
image
MSCI puts bubble stock ArtGo (3313) into China indexLose your marbles
Company announcement, 8-Nov-2019
Despite Webb-site's bubble warning on 15-Sep-2019, the SFC hasn't followed suit. The stock jumped 40% on Friday. Congratulations MSCI, you've just made it easier for active stock-pickers to outperform your mindless index by excluding ArtGo from their holdings - unless the SFC intervenes before the end of 26-Nov.
Court makes orders against ex-Chairman and EDs of Minth (0425)
SFC, 7-Nov-2019
For an undisclosed connected transaction in 2008 involving a BVI company and his nephew and niece, once again demonstrating how the Stock Exchange allows related parties to hide behind offshore companies whose ownership cannot be traced.
SFC bans Song Baojun for 1 year
SFC, 6-Nov-2019
He effected 4 unit trust trades in 2013 without a client's specific authorisation using incomplete pre-signed forms. We note that in 2014 he went on from HSBC to Dah Sing Bank for 9 months, and was later registered to Hang Seng Bank (an HSBC subsidiary) for just 10 days starting on Christmas Day 2015.
SFC issues restriction notice to Hong Kong Wan Kiu Investment Co Ltd
SFC, 5-Nov-2019
OK now let's not make any childish jokes about the name. We'll have to wait for the SFC's investigation to come to a climax and hope that there is no manipulation involved.
Eminent businesswoman criticizes HK civil service
Global Times, 3-Nov-2019
Where would HK be without the great and unmatched wisdom of Annie Wu Suk Ching?
TVB (0511) v unknown defendants
HK Court of First Instance, 1-Nov-2019
For multiple reasons, Judge Mimmie Chan Mei Lan declines to grant an interim injunction against unknown persons attacking TVB's staff or property.
Central govt plans to 'improve' CE election system
RTHK, 1-Nov-2019
Good. Start by replacing corporate voting with one vote per job, then reallocate the Election Committee sub-sector seats proportionate to registered voters. Voila - a democratic committee! All doable in HK law, no need for NPCSC approval. Do the same for LegCo Functional Constituencies. Or by "improve" do you mean "tighten control over"?
HKEX's Li apologizes after remarks on China and HK
Bloomberg, 1-Nov-2019
To whom? He now says the design of One Country Two Systems is perfect, and it's only a problem of implementation. A bit like the Titanic then.
Court order bans online messages inciting violence
RTHK, 31-Oct-2019
This is getting silly. It is already illegal under common law to incite a crime. The penalty is the same as the underlying crime itself. What is needed is an injunction against people applying for injunctions against crimes. This follows an application 3 days ago by TVB for an injunction against people attacking its staff or property, both of which are offences already.
SFC takes China Medical & Healthcare (0383) and 6 directors to MMT, alleges late disclosure of inside information
SFC, 31-Oct-2019
It took them nearly 6 months to reveal windfall gains on shares of a company which became Alibaba Pictures Group Ltd (1060). The SFC is pursuing the entire board at that time (2014), including 3 INEDs who have since left.
Re Mark Taylor Simpson QC
HK Court of First Instance, 31-Oct-2019
The liquidators of China Forestry Holdings Co Ltd apply to admit a UK silk to help them sue KPMG, the auditor, for over HK$1.3bn. Acting Chief Judge Jeremy Poon rejects the proposition that Solicitor-Advocates, who now have rights of audience, are an acceptable alternative to junior barristers to assist the QC. The Bar Council sent 2 Senior Counsel and 2 juniors to oppose the application, while the Secretary for Justice supported it. The quasi-trade union wins. Mr Simpson must be assisted by local barristers.
Previously on Webb-site.com
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