Companies Bill 2002
15 October 2002
The Hong Kong Government has proposed some piecemeal amendments to the Companies Ordinance, which are currently being considered by a Bills Committee of the Legislative Council.
The origins of these proposals date back to the 2-Mar-94 budget speech in which the then Financial Secretary Sir Hamish Macleod said:
"We have tried in the past to respond to developments in the corporate world through piecemeal amendment of the Companies Ordinance. I believe we have reached a stage when a thorough review has become essential. We now need an ordinance for the 21st century. I have therefore asked the Secretary for Financial Services to take this forward."
In response, a consultancy report (popularly known as the Pascutto Report) was commissioned by the Government on 23-Nov-94 and delivered to then Financial Secretary Donald Tsang on 27-Mar-97 (full report or executive summary). This was followed by a public consultation on the consultancy report which was launched on 1-May-97 and concluded some time in mid-98. Then in early 1999 the Standing Committee on Company Law Reform (SCCLR), which was formed back in 1984, began a further study on the Pascutto Report and the results of the public consultation. This resulted in an report on the Pascutto Report being published in Feb-00. In that document, they wrote:
"It goes without saying that this third step will be succeeded by many more before the legislative process has been completed"
But they said it anyway, and they weren't kidding. Now, 8.5 years, two sovereigns and two Financial Secretaries after the budget speech, another of those "piecemeal amendments" is being proposed to the Companies Ordinance - something that Sir Hamish Macleod intended to avoid.
At Webb-site.com, we think of laws as the "software" of society. We need a system of major releases as well as occasional and prompt "software patches" to fix bugs (or loopholes) and add minor new features as we go along. The last major release of Company software in Hong Kong was 1984, in response to a report issued in 1973, when man last walked on the Moon, colour TV was still a novelty, and the first personal computers looked like this.
If Microsoft (which wasn't founded until 1974) had proceeded at the speed of HK Company Law, we'd be living with DOS and waiting for Windows. With this glacial pace of reform comes the Companies Bill 2002, implementing 17 of the recommendations from the SCCLR's report of 2000. The other recommendations will be "implemented in phases".
Never mind, progress is better than nothing, so download our submission and read it for yourself. Other submissions and the agenda for today's Bills Committee can be found here.
© Webb-site.com, 2002
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