Exchange’s Disciplinary Action against China Properties Investment Holdings Limited (Stock Code: 736) and Five Directors
Regulatory
04 Jan 2022
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 Stock Exchange of Hong Kong Limited
CRITICISES:
- China Properties Investment Holdings Limited (Stock Code: 736);
- Mr Han Wei, executive director, Chairman and Chief Executive Officer of the Company;
- Mr Au Tat On, executive director;
- Ms Cao Jie Min, independent non-executive director;
- Mr Liang Kuo-Chieh, independent non-executive director; and
- Mr Lai Wai Yin Wilson, former independent non-executive director.
AND DIRECTS:
the Company to conduct an internal control review and each of the above directors to undergo training.
In January and June 2019, the Company’s wholly owned subsidiary made two disposals of listed shares on the Company’s behalf. Each of the two disposals constituted a discloseable transaction, but the Company failed to timely announce the two disposals.
This was a repeated breach. In 2018, the Company had been warned by the Exchange after a similar incident. Although the Company announced that, in light of that breach, it would implement certain measures to strengthen its internal controls, the Company failed to take timely steps to do so. The Directors failed to discharge their duties to ensure the Company had adequate and effective internal controls.
Key Messages:
Directors must respond appropriately and promptly when breaches or deficiencies have been discovered. A failure to do so will constitute a breach of their duties, and can call into question the listed issuer’s culture and attitude towards Listing Rule compliance. A repeated breach after a warning or guidance has been given by the Exchange is far more likely to result in disciplinary action being taken, and the imposition of a public sanction on those responsible.
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