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Note to subscribers for the amendments to
the rules governing the listing of securities on the Growth Enterprise Market
("GEM Listing Rules")
Update No. 17
1st April 2003
Dear Sirs,
Amendments to the GEM Listing Rules upon coming into force of the Securities and Futures
Ordinance (the "SFO")
The SFO, together with relevant subsidiary legislation, will come into force on 1st April 2003.
Relevant amendments have been made to the GEM Listing Rules to reflect the requirements of the SFO.
The amendments we have made comprise essentially the following:
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References in the GEM Listing Rules to legislation which will be repealed by the SFO have been
amended to harmonise with the SFO.
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References in the GEM Listing Rules to exempt or registered dealers, investment advisers and
their respective representatives have been updated to reflect the new licensing regime under the SFO.
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Relevant provisions in the GEM Listing Rules about disclosure of interests have been
extensively revised to reflect the more extensive requirements under the SFO (please see under
"New disclosure of interests
requirements" below).
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Amendments have also been made so that new applicants and listed issuers authorise the
Exchange to make filings with the Securities and Futures Commission (the "SFC") pursuant to the Securities and Futures
(Stock Market Listing) Rules which introduces a new dual filing regime.
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The GEM Listing Rules have been amended so that the procedures set out in the Memorandum
of Understanding Governing Listing Matters concluded between the Exchange and the SFC on 28th January 2003 about the administration
of takeovers-related matters and share repurchases (other than on market share repurchases) are reflected.
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New disclosure of interests requirements
Pursuant to the SFO, disclosures have to be made containing the particulars required
under the SFO and the disclosure forms prescribed by the SFC. The disclosures required are much more extensive than those under the
existing law. Relevant provisions in the GEM Listing Rules about disclosure of interests have therefore been extensively
revised.
Substantial shareholders (within the meaning of the GEM Listing Rules), directors and
chief executives and other persons who are required to disclose interests under the SFO have to separately disclose their long and
short positions in shares and underlying shares and, in the case of directors and chief executives, their interests in debentures.
They must also disclose separately for listed and unlisted equity derivatives whether the interests in underlying shares are derived
from physically settled or cash settled equity derivatives. The prescribed forms for disclosure under the SFO contain details about
the capacities in which such interests are held and the nature of such interests. Such information will also need to be disclosed.
The new disclosure requirements under the GEM Listing Rules will come into force on
1st April 2003 but they will not be applied to disclosures referable to a date or period ending before 1st April 2003 which will
continue to be made in accordance with existing requirements. Hence, for companies with a financial reporting period ending before
1st April 2003, information about interests held will be disclosed in the published financial reports in accordance with existing
requirements.
Coming into effect
The amendments will come into force on 1st April 2003.
Yours faithfully
For and on behalf of
The Stock Exchange of Hong Kong Limited
Karen Lee
Head of Listing, Regulation and Risk Management
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