Former British colony relents after criticism that restrictions hindered corporate due diligence
Hong Kong bankers and lawyers will be able to search the city’s companies registry under proposed exemptions to plans to tighten public access to the database, Secretary for Financial Services Christopher Hui said on Saturday.
Business and governance experts have criticised a government plan to restrict access to the personal information of company directors, outlined this year, saying it will reduce transparency in the city’s corporate sector.
Dealmakers working through the due diligence phase of corporate transactions regularly consult the database to research and verify the history and identities of executives and directors.
Hui told a RTHK Radio programme on Saturday that lawyers, bankers and accountants could now apply to the company registry to gain access to documents for work purposes.
Anti-money laundering
“But the premise is that they have to be really doing relevant checks and work, because we need to strike a balance and protect privacy,” Hui was quoted as saying on the RTHK website.
“For example, lawyers, accountants and banks have to be doing the searches for know-your-customer checks or work related to compliance and anti money-laundering.”
The proposed exemptions were confirmed to Reuters by Hui’s spokeswoman.
Changes to the registry announced earlier included a first phase which gave companies an immediate option to withhold information about directors, such as their addresses and identification or passport numbers.
A second phase would withhold all documents containing such information from public view.
The Hong Kong government had argued the reforms were needed to protect privacy.
Information on the data base is also commonly used to trace cross-party and cross-company ownership structures that feature in Hong Kong’s sometimes opaque corporate system.
- Reuters
