Hong Kong moves to restrict information on Company Directors

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Hong KongDue to recent reports that readily available personal information on company directors of Hong Kong Companies has led to exposing the fortunes of Chinese leaders’ it has been proposed that restrictions should be placed on publicly available company director information. Last year Bloomberg utilised identity card numbers from company filings in order to produce a detailed report on the wealth of the relatives of China’s top leader, Xi Jinping. The New York Times also used data to report on the wealth of premier Wen Jiabao’s family. Currently in Hong Kong anyone can access director information such as home address and passport / ID numbers for a nominal fee. Under the proposed changes the home addresses and ID information would not be publicly available; details would be obscured in filings starting from January 2014. Details could also be removed from historical filings if requested. Only certain groups such as law enforcers, regulators and liquidators would have access to this information. These new proposals have highlighted fears that Hong Kong’s position as a transparent business jurisdiction is under threat. Currently Hong Kong has separate legal, financial and administrative systems from China and has a relatively high degree of autonomy as a legacy of British colonisation. Information on public and private companies is widely available. This is not the case in many other Asian jurisdictions, particularly China where there is a high degree of secrecy. It is feared that increased Chinese influence in Hong Kong may destroy the current level of transparency and freedom of information. The provisions for increased privacy attracted very little attention until recently when they were outlined in a briefing paper submitted to the legislature’s financial affairs panel. The proposals have concerned investors and the media due to increased difficulty to highlight and document cases of corruption. The proposals are seen as being negative for transparency making it more difficult to find connections between individuals and companies however there is still a chance that the provisions could be amended by lawmakers.