19 July 2019

Hong Kong Exchange presses for rule changes, WSJ says

Charles Li, chief executive of the Hong Kong Exchanges & Clearing Ltd. (HKEx, 00388.HK), has urged regulators to allow changes of rules to accommodate new listings, after Alibaba Group announced its decision to launch its initial public offering in New York, the Wall Street Journal reported Sunday. The Hong Kong bourse lost the IPO deal after months of gridlock between HKEx and the Securities and Futures Commission over adapting rules to suit a proposal by the Chinese e-commerce giant that its partners continue to nominate the majority of the board even after the company is listed. Such a structure, which would give the founding partners control of the board, would violate Hong Kong’s existing “one shareholder, one vote” rule, according to the newspaper. While Li defended the decision not to compromise over one company’s demands, he warned that unless rules are changed, the city will lose out in the race to list companies that are proposing alternative shareholder structures, the report said.

– Contact HKEJ at [email protected]



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