HK delays plan to limit info on company directors

[March 29, 2013]  HONG KONG (AP) -- Hong Kong's government said Thursday it is postponing a plan to restrict public access to personal information about company directors after protests from journalists and business groups.

Information gleaned from the database was used in investigative news reports last year to help expose fortunes linked to Chinese leaders. Plans to limit who could see the data raised fears that Hong Kong's position as a transparent and open financial center was slipping.

The Financial Services and the Treasury Bureau said it would consult further on the proposed changes, which were part of a wider update to the southern Chinese city's Companies Ordinance.

The proposals would have obscured the home addresses and ID card or passport numbers of company directors listed in the Companies Registry starting in the first quarter of 2014, with full access given only to certain groups like regulators, liquidators and law enforcement. Currently, anyone can have access to the information for a nominal fee. Some 3.3 million searches were carried out in the year to March 2012.

The changes were aimed at addressing privacy concerns but raised fears among investors and the media that it would be harder to document cases of corruption or malfeasance.

Business groups also said it would be harder to track down owners of failed businesses who owed their workers money. Others worried that it would make money laundering easier. A shareholder activist, David Webb, argued that identity numbers were essential for distinguishing people with the same names, either in English or Chinese.

Stories last year by Bloomberg and the New York Times relied on data mined from company filings to examine the wealth of the families of some of China's top leaders. Hong Kong, a former British colony that is now a semiautonomous region of China with its own legal and financial system, has become a popular place for mainland Chinese businesspeople and government officials looking to hide their wealth through shell companies, which are easy to set up.

"There are complex legal, privacy and operational issues involved," the bureau said in a statement late Thursday. "We believe that we should not rush to solutions without giving more time for the community to build consensus on those issues."

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Online:

FSTB statement: http://bit.ly/ZCKlpL

Companies Registry:
http://www.icris.cr.gov.hk/csci/

[Associated Press; By KELVIN CHAN]

Follow Kelvin Chan on Twitter at http://twitter.com/chanman.

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