香港联合交易所有限公司
(香港交易及结算所有限公司全资附属公司)
THE STOCK EXCHANGE OF HONG KONG LIMITED
(A wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited)
The Listing Committee of The Stock Exchange of Hong Kong Limited (“The Exchange”)
CENSURES:
(1) Sandmartin International Holdings Limited (Stock Code: 482) (“Company”);
(2) Mr Hung Tsung Chin, executive director (“ED”) of the Company (“Mr Hung”);
(3) Ms Chen Mei Huei, former ED of the Company (“Ms Chen”);
(4) Mr Liao Wen I Tiger, former ED of the Company (“Mr Liao”);
AND CRITICISES:
(5) Mr Frank Karl-Heinz Fischer, former ED of the Company (“Mr Fischer”);
(6) Mr Chen Wei Chun, ED of the Company;
(7) Mr Wu Chia Ming, independent non-executive director (“INED”) of the Company;
(8) Mr Han Chien Shan, former INED of the Company (“Mr Han”); and
(9) Mr Lee Chien Kuo Thomas, former INED of the Company.
(the directors identified at (2) to (9) above are collectively referred to as the “Relevant Directors”)
AND DIRECTS:
the Company to appoint an independent professional adviser for the purposes of an internal control review and the Relevant Directors to attend training.
This case involves a settlement between the Company, the Relevant Directors (apart from Mr Han) and the Listing Division in respect of their Listing Rule breaches arising from the events and conduct described below.
The Exchange found that the Company failed to announce the acquisition of a subsidiary and certain loans made to a connected party in a timely manner, and failed to ensure that certain disclosures in an announcement and in a circular were accurate and complete in all material respects and not misleading. The Company did not have adequate and effective internal controls at the relevant time.
Mr Hung, Ms Chen and Mr Fischer failed to report relationships with connected party implications to the Company. Mr Hung and Ms Chen also failed to ensure that certain figures used in a circular were accurate and up-to-date. As a result, Mr Hung and Ms Chen failed to discharge their directors’ duties and undertakings to comply with the Listing Rules to the best of their ability. Mr Hung, Ms Chen and Mr Fischer failed to use their best endeavours to procure the Company’s compliance with the Listing Rules.
The Exchange also found that Mr Liao failed to cooperate in the investigation conducted by the Listing Division, and that the Relevant Directors failed to take an active role in implementing, reviewing and monitoring the effectiveness of the Company’s internal control procedures and placed excessive reliance upon the company secretary for Listing Rule compliance.
Key messages:
This case involves repeated breaches of the Listing Rules by a listed issuer. Directors are reminded that they are individually and collectively responsible for an issuer’s compliance with the Listing Rules. Merely placing reliance on the company secretary to procure Listing Rule compliance is not considered to be a satisfactory discharge of their duties in this regard. Directors must also be able to demonstrate that they took sufficient interest in the issuer’s compliance, for example, by ensuring that there was supervision of relevant staff, proper reporting to the Board, and the provision of regular training.
The failure by certain directors to recognise relationships which gave rise to connected party implications, and their failure to take steps to ensure the accuracy of information presented in the Company’s announcements, demonstrated a disregard for compliance with the Listing Rules and deprived the Company’s investors and shareholders of timely receipt of information, which damages the integrity of the market and erodes investor confidence.
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A copy of the Statement of Disciplinary Action is available on the HKEX website.
For the avoidance of doubt, the Exchange confirms that the sanctions in the Statement of Disciplinary Action apply only to the Company and the Relevant Directors, and not to any other past or present members of the board of directors of the Company.
Ends