MR CHAN KIN-POR (in Cantonese): President, Secretary Prof CHAN will leave the Government very soon, I wish to thank him for maintaining the financial stability of Hong Kong and seriously addressing the concerns and feedbacks of the market on government policies. I believe the Secretary will continue to offer good proposals for Hong Kong’s finance technology no matter which post he may take up in the university in future. May I wish the Secretary good health and all the best!
If short selling institutions publish reports for private gains, they must be combated vigorously. As stated in the main reply, SFC will enhance the short-selling regime if necessary. Can the Secretary tell us whether there are any major differences between the regulation of short selling institutions by overseas regulatory bodies and that by local regulatory bodies, and which areas Hong Kong can draw reference from?
SECRETARY FOR FINANCIAL SERVICES AND THE TREASURY (in Cantonese): First of all, I thank Mr CHAN Kin-por for his blessing and I am also very honoured to work with Honourable Members for so many years. I believe we will all continue to work hard for Hong Kong’s financial market.
With regard to this supplementary question, the control over the short-selling regime in Hong Kong is, as I have just said in the main reply, very stringent at present, including requiring all short sales to be covered and a short position reporting regime has been put in place. Compared with other countries, our current regime is one of the most stringent.
As for the second supplementary question concerning short selling research, just as I have said in my reply, short selling research itself is not something bad as the market needs this kind of research to enhance its transparency. Of course, if short sales involve market manipulation, SFC will definitely take follow-up actions. In the example just mentioned by me concerning the case where SFC had taken enforcement action, SFC decided to follow up because it opined that the short selling institution had provided false information and made commentaries disregarding the facts. If Members have paid attention to international news, they may notice that the international community considered that SFC had taken stringent enforcement action to bring the institution that published false reports to justice. This proves that Hong Kong’s regulatory regime is not only flexible, but is also capable of taking follow-up actions.