Author Archives: hksar gov

     The effective exchange rate index for the Hong Kong dollar on Wednesday, September 8, 2021 is 101.3 (up 0.2 against yesterday’s index). read more

     Following is a question by the Hon Mrs Regina Ip and a reply by the Secretary for Financial Services and the Treasury, Mr Christopher Hui, in the Legislative Council today (September 8):
 
Question:
 
     The Stock Exchange of Hong Kong Limited (SEHK) launched the Growth Enterprise Market (GEM) in 1999, and amended the GEM Listing Rules in 2018 to raise the GEM admission requirements and remove the “streamlined application process” for transfer of listings from GEM to the Main Board. Some members of the industry have pointed out that the amendments concerned have undermined the positioning of GEM as a “stepping stone” to the Main Board, and deprived small and medium enterprises (SMEs) of the opportunity to raise funds through listing on GEM (given the fact that only one company was newly listed on GEM in the first half of this year). In addition, in the absence of investors’ attention, it is difficult for the 360-odd companies currently listed on GEM to raise funds (as illustrated by the fact that the “amount of funds raised by companies after listing” last year was less than one fourth of that a decade ago). In this connection, will the Government inform this Council whether it knows if SEHK has plans to revitalise GEM, so that more SMEs can raise funds through listing on GEM; if SEHK does, of the details; if not, the reasons for that?
 
Reply:
 
President,
 
     Hong Kong is a major global listing platform for companies from different jurisdictions. During the past 12 years, Hong Kong had ranked first in the world seven times in terms of funds raised through initial public offerings (IPOs). In the first eight months of this year, Hong Kong raised a total of HK$269.8 billion of funds through IPOs, representing 81 per cent increase when compared with the figure for the same period last year.
 
     The Government, regulators and Hong Kong Exchanges and Clearing Limited (HKEX) strive to develop Hong Kong into a broader and deeper fundraising platform and safeguard investors’ interests.
 
     As far as the Growth Enterprise Market (which is called GEM at present) is concerned, in response to market views that the requirements of GEM back then were abused by market participants, causing possible disruption to the order of the market of some securities and thereby affecting the overall quality of the market, HKEX repositioned GEM in 2018 as a stand-alone board to provide a fundraising platform for small and medium-sized enterprises (SMEs) after consulting the market’s views in 2017.
 
     The streamlined process for transfer to the Main Board (Streamlined Process) was cancelled under GEM having considered the problems more commonly found among GEM issuers back then including high shareholding concentration, illiquidity and high share price volatility, which led to market concerns that the relevant process might be exploited by issuers with poorer quality to gain easier access to the Main Board via GEM. The Streamlined Process was also considered by market participants as being contrary to the objective of the sponsor regime implemented in October 2013 which was to ensure companies seeking a listing either on the Main Board or GEM have comprehensive due diligence conducted on them with properly drafted listing documents prior to admission to the relevant board. If an issuer can list on the Main Board through transfer from GEM without having gone through due diligence process, there is a risk that GEM would be exploited given the different listing eligibility requirements between the two boards which may eventually affect the quality and reputation of the Hong Kong market.
 
     According to the figures from HKEX, the effect of the then Growth Enterprise Market as a “stepping stone” was limited. For example, the total number of transfer from the Growth Enterprise Market to the Main Board as a percentage of the total number of Growth Enterprise Market issuers eligible for the transfer decreased from 7.2 per cent in the second half of 2008 to 2.7 per cent in 2016.
 
     In order to maintain a clear distinction between the positioning of the Main Board and GEM, HKEX raised the minimum market capitalisation at the time of listing of GEM applicants from HK$100 million to HK$150 million and the minimum public float value of securities from HK$30 million to HK$45 million, while at the same time correspondingly raised the minimum market capitalisation at the time of listing of Main Board applicants from HK$200 million to HK$500 million and the minimum public float value of securities from HK$50 million to HK$125 million.
 
     HKEX is cognizant of market views that the relevant measures will have impact on SMEs that intends to list. Nevertheless, HKEX has the responsibility to uphold and continuously enhance the quality of Hong Kong’s capital market and act in the interest of the investing public in accordance with the requirements in the Securities and Futures Ordinance. The relevant measures would help enhance the overall quality of the market and would not deprive suitable SMEs of the opportunity to list in Hong Kong. They will also facilitate the development of the Main Board and GEM in the long run. The increased differentiation between the listing requirements of GEM and Main Board will allow applicants which intend to list in Hong Kong but could not meet the Main Board listing requirements, including SMEs with lower market capitalisation and profit, to choose GEM as a more targeted alternative listing platform.
 
     In light of some feedback that the removal of the Streamline Process would make the transfer to Main Board unduly onerous, HKEX has provided certain facilitating measures for applicants which transfer from GEM under the new process. These include dispensation with certain documentary requirements, exemption from the requirements on post-Initial Public Offering lock-up, restriction on fund raising and appointment of compliance adviser. Furthermore, applicants which transfer from GEM to the Main Board are not required to comply with the relevant delisting procedures.
 
     HKEX understands from the other market consultations conducted subsequently that market participants considered that HKEX should further study about enhancing the positioning and functions of GEM as a specific board for listing of SMEs in order to further attract and facilitate the listing and fundraising of SMEs. On the other hand, there were market comments that the GEM Listing Rules should be reviewed to strengthen regulation. In this regard, HKEX has launched a review to carefully consider the market’s views on GEM’s positioning and market perception as well as to study about the development of similar markets in other places. If the review concludes that changes to the GEM Listing Rules are necessary, HKEX will further consult the market on the proposals. read more

     Following is a question by Ir Dr the Hon Lo Wai-kwok and a written reply by the Secretary for Food and Health, Professor Sophia Chan, in the Legislative Council today (September 8):
 
Question:
 
     The Government announced in February 2018 that $2 billion would be earmarked for launching a 10-year Market Modernisation Programme (MMP) to improve the facilities of public markets (markets) under the Food and Environmental Hygiene Department. In this connection, will the Government inform this Council:
 
(1) whether it will conduct a comprehensive review on the extent of difficulty in and urgency for carrying out modernisation works for the various markets as well as on the development potentials of such markets, and set the priorities and timetable for carrying out related works for the various markets, with a view to speeding up the progress and ensuring that such works can be completed within 10 years; if so, of the details; if not, the reasons for that;
 
(2) whether it will assess afresh the estimated expenditure of MMP, and seek approval from this Council for supplementary provisions as early as possible when necessary; if so, of the details; if not, the reasons for that; and
 
(3) whether, in order to dovetail with modernised markets for maximising their effectiveness, the Government will step up publicity and education efforts among stall operators and patrons of markets about maintaining the hygiene of markets, so as to build a new culture on using markets; if so, of the details; if not, the reasons for that?
 
Reply:
 
President,
 
     The Government announced in the 2018-19 Budget that $2 billion would be earmarked for implementing a 10-year Market Modernisation Programme (MMP) to improve the facilities in public markets under the Food and Environmental Hygiene Department (FEHD). The MMP aims to improve the operating environment of public markets, thereby facilitating tenants’ business operation and, at the same time, providing market patrons with a more pleasant shopping environment. 
 
     My reply to the question raised by the Member is as follows –
 
(1) and (2) In identifying suitable markets for the implementation of different scales of improvement projects under the MMP, the Government considers a host of factors, including the geographical locations and distribution of the markets, condition of facilities in the markets, business viability, community needs and tenants’ readiness, etc. In particular, the Government would seek to ensure that the selected markets are situated in locations which can support their future business viability, and that they are reasonably distributed across the territory to benefit the entire community. In implementing the MMP, the FEHD works closely with the relevant works departments to identify viable hardware improvement options and consults existing tenants on relevant matters such as the facilities improvement options, rental arrangements and management improvement measures, etc. The Government also reports to the concerned District Councils on the implementation of relevant MMP projects in a timely manner and seeks funding approval according to the established mechanism.
 
     The pioneering project of the MMP is the overhaul of Aberdeen Market. After obtaining funding approval from the Legislative Council, the Government commenced the pre-closure preparatory work in August 2021. In November 2021, the Aberdeen Market will be closed fully for the commencement of the overhaul works. The Government will take appropriate measures, including the use of pre-fabricated parts with regards to the actual circumstances, to expedite the works progress, with a view to completing the overhaul works within 2022. Meanwhile, the Government is also carrying out the preparatory and consultation work for the proposed overhaul works for some other markets, including Yeung Uk Road Market, Ngau Tau Kok Market and Kowloon City Market. In addition, the Government has consulted and obtained the support of the relevant Market Management Consultative Committees (MMCCs) on the minor refurbishment or improvement works for 11 markets (including Ngau Tau Kok Market, Yeung Uk Road Market, Luen Wo Hui Market, Fa Yuen Street Market, Quarry Bay Market, Shui Wo Street Market, Tsuen Wan Market, Mong Kok Cooked Food Market, Ngau Chi Wan Market, Shek Tong Tsui Market and Nam Long Shan Road Cooked Food Market). The works in four of the above markets have been completed, while those in six others are scheduled for completion by the end of 2021. For the remaining market, preparation for the works is underway. The works are expected to commence in phases in the second half of 2022.
 
     Support from relevant stakeholders, in particular tenants, is crucial to the smooth implementation of projects under the MMP. The FEHD will continue to actively follow up on the above projects and identify more suitable markets for the MMP, so as to make the best use of the $2 billion earmarked to improve the operating environment of markets. When the projects are close to completion, the Government will review the effectiveness of the MMP in a timely manner and consider earmarking additional resources for the programme.
 
(3) The FEHD attaches great importance to the environmental hygiene of markets and endeavours to step up its promotion and education targeting tenants and consumers with a view to enhancing their awareness on market environmental hygiene and creating a market hygiene culture. Through the regular MMCC meetings of individual public markets, the FEHD reminds tenant representatives to pay attention to environmental hygiene, including to comply with the anti-epidemic measures, to handle the miscellaneous articles and refuse at their stalls properly, to take the appropriate anti-rodent measures, to conduct proper cleansing work at their stalls on the “market cleansing day” organised by the FEHD twice a month, and, for poultry stall tenants, to take stringent cleansing and disinfection measures on a daily basis to prevent the spread of avian flu. In addition, the FEHD also from time to time puts up various promotional posters on health education at prominent positions within public markets and distributes leaflets to tenants and consumers, urging them to pay attention to personal hygiene, to take proper preventive measures against avian flu and to use contactless payment means, etc.
 
     In addition to improving market facilities through the implementation of the MMP, the Government will also implement new market management measures, including strengthening the daily management of public markets and stepping up the promotion and publicity work for public markets, in order to enhance the overall competitiveness of public markets. read more

     Following is a question by the Hon Luk Chung-hung and a written reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (September 8):

Question:

     It is learnt that in recent years, food delivery online platforms (platforms) have developed rapidly, and more and more people have joined the courier teams of such platforms. Meanwhile, the number of traffic accidents involving such couriers has risen. The work safety of such couriers and whether they are eligible for employees’ compensation after sustaining injuries are in doubt. In this connection, will the Government inform this Council:

(1) of the numbers of traffic accidents involving platform couriers in each of the past two years and since January this year, with a breakdown by the mode of travelling adopted by the couriers concerned at the time of the accidents (e.g. by driving motorcycle or private car, riding bicycle, or on foot);

(2) among the accidents mentioned in (1), the respective numbers of those which were (i) fatal, (ii) serious and (iii) slight, and the respective percentages of such numbers in the total numbers of traffic accidents in the territory during the same periods;

(3) the respective numbers of platform couriers who were (i) killed, (ii) seriously injured and (iii) slightly injured in the accidents mentioned in (1), and the respective percentages of such numbers in the total casualties of traffic accidents in the territory during the same periods, together with a breakdown by the mode of travelling adopted by the couriers concerned at the time of the accidents; and

(4) whether the Government will put in place new measures in the coming year to enhance the work safety of platform couriers and the protection of their labour rights and interests?
 
Reply:

President,

     After consulting the Labour Department (LD), the Hong Kong Police Force (the Police) and the Transport Department (TD), my reply to the Hon Luk Chung-hung’s question is as follows:

(1) to (3) On traffic accident figures, both the Police and the TD have not maintained breakdown of the number of traffic accidents and related casualties involving couriers of food delivery online platforms. However, the Police has conducted a one-off thematic study in respect of traffic accidents involving motorcycles (including fatal, serious and slight injury cases) and bicycles (including fatal and serious injury cases) in the first six months of 2021 and collated the number of traffic accidents and casualties related to food delivery. The relevant figures are tabulated as follows:
 

	Numbers of Traffic Accidents involving motorcycle and bicycle related to food delivery between January and June 2021
	Motorcycle (percentage over the total number of traffic accidents in Hong Kong during the same period)		Bicycle (percentage over the total number of traffic accidents in Hong Kong during the same period)
	Number of cases	Number of casualties (Note 1)	Number of cases	Number of casualties (Note 1)
Fatal (Note 2)	0 (-)	0 (-)	0 (-)	0 (-)
Serious (Note 2)	24 (0.3%)	24 (0.2%)	8 (0.1%)	8 (0.08%)
Slight (Note 2)	164 (2%)	164 (1.6%)	Not available

Note 1: Figure includes different people involved in the accidents. 

Note 2: Definitions:
Killed casualty: Sustained injury causing death within 30 days of the accident.
Serious injury: An injury for which a person is detained in hospital as an “in-patient” for more than 12 hours. Injuries causing death more than 30 days after the accident are also included in this category.
Slight injury: An injury of minor character such as a sprain, bruise or cut not judged to be severe, or slight shock requiring roadside attention without admission to hospital or requiring hospitalisation for less than 12 hours.

(4) Regarding the protection of labour rights and interests, the LD advises that the working relationship between platform companies and platform couriers, as well as the contractual terms involved, have been ever evolving. Depending on the actual circumstances of specific jobs, if there exists in substance an employment relationship between the contractual parties, a platform company must fulfil its obligations in respect of the statutory employment entitlements of the platform couriers it employs. The Government will continue to keep in view the policies on protecting the labour rights and benefits of platform couriers in different regions and conduct further study. 

     On road safety, the TD has been collaborating with the Road Safety Council (RSC) and the Police in launching various publicity and educational activities to raise the road users’ awareness of road safety. In recent years, relevant departments and the RSC have been striving to promote the messages of safe cycling and motorcycling. For example, publicity video clips and messages on cycling as well as motorcycling safety have been disseminated through information platforms on the Internet, social media platforms and publicity publications to remind cyclists and motorcyclists to follow traffic rules at all times. The Police will continue to encourage relevant stakeholders, including food delivery companies and cycling clubs, to promote cycling and motorcycling safety. read more

     Following is a question by the Hon Jimmy Ng and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (September 8):

Question:

     In November 2016, the Government launched the Professional Services Advancement Support Scheme (PASS) with a total commitment of $200 million, with an aim to support Hong Kong’s professional services sectors to carry out worthwhile projects, thereby spearheading proactive outreaching promotion efforts and enhancing service standards. In this connection, will the Government inform this Council: 

(1) of the following information on PASS for each year since it was implemented and the period from January 1 to July 31 this year: (i) the number of funded projects, (ii) the number of projects rejected, (iii) the number of beneficiary organisations, (iv) the average amount of grant per project, and (v) the major beneficiary sectors; 

(2) whether it will consider afresh formulating a set of quantitative key performance indicators for assessing and monitoring the effectiveness and achievements of all funded projects; if so, of the details; if not, the reasons for that; 

(3) given that financial services, maritime services and tourism services are pillar industries of Hong Kong, whether the Government will include such sectors in the list of eligible professional services sectors and encourage the relevant organisations of such sectors to apply for funding under PASS; if so, of the details; if not, the reasons for that; and 

(4) as the Chief Executive announced in the 2020 Policy Address that a funding of $50 million had been set aside for setting up a Professionals Participation Subsidy Programme (PSP) under PASS to subsidise major professional bodies to participate, after the epidemic situation has stabilised, in relevant exchange, promotion and professional standard enhancement activities organised by the Government, the Hong Kong Trade Development Council and overseas Hong Kong Economic and Trade Offices, so as to encourage Hong Kong’s professional services sectors to step up efforts to promote Hong Kong’s competitive edges and professional services to the Mainland cities in the Guangdong-Hong Kong-Macao Greater Bay Area and overseas markets, of the following information on PSP since it was launched: (i) the number of approved applications, (ii) the total amount of subsidies granted, and (iii) the estimated number of beneficiaries? 

Reply:
 
President,
 
     In response to the question raised by the Hon Jimmy Ng, my reply is as follows:
 
(1) As at July 2021, a total of 171 eligible applications (Note) have been received under the Professional Services Advancement Support Scheme (PASS). Excluding 50 applications still pending the applicants’ submission of supplementary information or clarifications on the project content, the Vetting Committee (VC) has completed the assessment of 121 applications, of which 75 projects have been funded with a total grant of about $54 million. The funding amount for each project ranges from $110,000 to $2,780,000, and the average funding per project is $720,000. It is expected that over 33 000 Hong Kong professionals will participate in the aforementioned projects.
 
     These funded projects involve 49 grantees and cover a wide range of professional services sectors, including accounting, legal and dispute resolution, architecture, engineering, healthcare, information and communications technology, design, business consultancy, technical testing and analysis, company secretary and waste management and environmental consultancy services.
 
     The annual breakdown of the number of applications for which the VC has completed assessment is as follows:
 

Financial year	2017-18	2018-19	2019-20	2020-21 and April to July 2021	Total
Number of funded projects	20	24	16	15	75
Amount of approved grant ($ million)	17.72	17.86	8.7	10.03	54.31
Number of rejected applications	26	2	6	6	40

 
     Another six applications have also been approved in principle. Pending the submission of cashflow projections and revised project proposals from the applicants concerned and subject to the signing of project agreements with the Government, these projects would be funded.
 
(2) To monitor and evaluate the progress and deliverables of funded projects, all grantees must submit project final reports and audited accounts upon completion of the projects. For projects with implementation period exceeding 18 months and/or funding amount exceeding $300,000, grantees are also required to submit project progress reports during project implementation. The project final reports and progress reports must include details of project implementation, quantifiable project deliverables, project evaluation by grantees and evaluation of project deliverables by users and participants. In addition, the PASS Secretariat will carry out onsite visits for funded activities held locally (or online visits in case of online activities), and progress review meetings with grantees for activities held outside Hong Kong.
 
     We consider that the existing monitoring and evaluation arrangements would enable multi-dimensional monitoring and evaluation of the progress and deliverables of funded projects. For projects already completed with project final reports submitted, the majority of PASS project participants had given positive comments on the project deliverables.
 
(3) The professional services sectors covered under PASS are determined with reference to the relevant classifications of professional services sectors by the World Trade Organization, the United Nations and the Census and Statistics Department, which were adjusted according to the views expressed in the meeting of the Legislative Council Panel on Commerce and Industry held in June 2016. PASS also encourages applicants to consider organising cross-professional sector projects. For example, projects pertaining to shipping or maritime law, arbitration and dispute resolution, financial technology and even travel technology may also be funded. PASS had also received applications relating to the financial technology sector in the past.
 
(4) As announced by the Chief Executive in the 2020 Policy Address, $50 million has been set aside under the PASS to set up a new funding programme named the Professionals Participation Subsidy Programme (PSP), to subsidise the participation of Hong Kong’s major professional bodies in relevant activities organised by the Government, the Hong Kong Trade Development Council (HKTDC) and overseas Hong Kong Economic and Trade Offices (ETOs), with a view to encouraging Hong Kong professional services sectors to step up promotion of Hong Kong’s competitive edges and professional services to the Mainland cities of the Guangdong-Hong Kong-Macao Greater Bay Area and overseas markets after the pandemic has stabilised.
 
     At present, a total of five activities have been approved in principle as tentative activities under the PSP. Details are as follows:
 

Name of Activity	Location	Format	Target Beneficiary Sector	Organiser
Hong Kong Infrastructure Development and Real Estate-related Services Mission to Jakarta, Indonesia	Jakarta, Indonesia	Forum Meeting Company visit Business matching session	Building and Construction-related services	HKTDC
Hong Kong Professional Mission to “Think Business, Think Hong Kong” Symposium	Bangkok, Thailand	Conference Thematic session Business matching session	Accounting-related services Legal services Company Secretary services Business Consultancy services	HKTDC
Promotion of Hong Kong’s Strengths in Dispute Resolution Services (particularly on maritime arbitration and online dispute resolution)	Tokyo, Japan	Meeting Seminar	Legal services (arbitration and mediation)	Tokyo ETO
Hong Kong Professional Mission to “SmartHK, Guangzhou”	Guangzhou	Forum Business matching session Company visit	Accounting-related services Legal services Information and Communications Technology services Building and Construction-related services Design services Business Consultancy services	HKTDC
Hong Kong Infrastructure Development and Real Estate-related Services Mission to Greater Bay Area	Huizhou	Meeting Infrastructure visit	Building and Construction-related services	HKTDC

 
     Key information of PSP (including the list of tentative activities) has been uploaded onto the PSP website. Due to the evolving pandemic developments, the exact timing, programme, number of beneficiaries and cost details of the tentative activities under the PSP are still pending at the present stage. Other activities are under planning by the HKTDC and ETOs and the details concerned can only be worked out after the pandemic has stabilised and cross-border/boundary travel has resumed.
 
Note: The number of eligible applications does not include applications submitted by ineligible organisations, applications for projects which were profit-making in nature and/or applications where the majority of target beneficiaries were not Hong Kong professionals from the eligible professional services sectors. The figure concerned also does not cover applications withdrawn or given up by the applicants. read more