Introduction
Insider
dealing is defined in section 9 of Hong Kong's Securities
(Insider Dealing) Ordinance. It may occur in a number
of ways, but generally the legislation is directed
at prohibiting the misuse of particular information
about a listed company's affairs by persons connected
with that company who are in possession of that information
using it (or encouraging others to use it) for the
purpose of trading in the company's stock to make
a profit or avoid a loss.
The Insider Dealing Tribunal was established in 1991
under the provisions contained in the Ordinance. If
the Financial Secretary is of the view that insider
dealing in relation to the securities of a listed
corporation has (or may have) taken place, he may
require the Insider Dealing Tribunal to inquire into
the matter and determine:
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whether
insider dealing in relation to the named listed
corporation's securities has taken place; |
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the
identity of every insider dealer; and |
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the
amount of any profit gained or loss avoided as
a result of the insider dealing. |
The
Insider Dealing Tribunal is an inquisitorial tribunal.
It may consider all relevant and logically probative
evidence. It is empowered to conduct further inquiries
to supplement the evidence presented by the parties
in order to assist it in determining whether or not
the allegation of insider dealing it is concerned
with has been proved.
The Insider Dealing Tribunal may order that a person
found to be an insider dealer pay to the Government
of the Hong Kong Special Administration Region an
amount not exceeding the amount of any profit gained,
or loss avoided, by him as a result of his insider
dealing.
The Insider Dealing Tribunal currently sits in two
divisions. The Chairman of each (who must be a High
Court Judge or a Deputy High Court Judge) is appointed
by the Chief Executive on the recommendation of the
Chief Justice. The Chairman sits with two members
who are prominent members of Hong Kong's business
and professional community. They are appointed by
the Financial Secretary, who acts on the recommendation
of the Chairman. Every sitting of the Tribunal must
be held in public unless the Tribunal considers, in
the interests of justice, that a sitting (or any part
of it) should be held in private.
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