REGULATORY ENFORCEMENT NEWSLETTER - ISSUE 1
A quarterly roundup of regulatory issues
Part XIVA of the Securities
and Futures Ordinance
With the intention of changing behaviour and
enhancing market transparency, on 1
January 2013, Part XIVA of the SFO became
law and thereafter required listed companies
to disclose inside information as soon as
reasonably practicable after it came to their
The trigger for disclosure (section 307B SFO) being that
the inside information has, or ought reasonably to
have, come to the knowledge of an officer of the listed
company in the course of them performing their
functions as an officer, and, a reasonable person acting
as an officer of the company would consider the
information as inside information.
On 1 January 2013, the Market Misconduct Tribunal
”), an inquisitorial body established to police and
regulate market behaviour, had its jurisdiction
expanded to determine breaches of Part XIVA.
Four years down the road, we are now starting to see
the SFC’s first Part XIVA enforcement actions being
decided by the MMT.
Below, we consider the MMT’s decisions concerning:
Yorkey Optical International (Cayman) Limited;
Mayer Holdings Limited.
These decisions show what the SFC expects.
They are also a benchmark for everyone else, in
particular those involved in the management of listed
companies, to take very careful notice of.
Failing to meet the exacting standards
demanded by regulators and law enforcement
can lead to very serious consequences for
businesses and the individuals who work in
them which include criminal prosecution,
regulatory enforcement, disciplinary action, loss
of reputation and livelihood, commercial and
market damage, bad publicity, regulatory
remediation exercises and civil claims.
In this newsletter prepared byIan Childs,
those which will follow on a quarterly basis, we
will update you about notable cases and trends
in the regulatory litigation area where the fast
pace of change continues unabated and levels of
enforcement by the Securities and Futures
”) remain extremely high.
Whenever any interesting Hong Kong Police or
Independent Commission Against Corruption
matters arise, it is our intention to also feature
I hope that you will find this newsletter
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