The Government of the Hong Kong Special Administrative Region (SAR) today (Monday) welcomed the approval by members of the Stock Exchange of Hong Kong and Hong Kong Futures Exchanges for the proposed demutualisation and merger of the Exchanges and the Clearing Houses.

"The approval is a major step towards the strategic market structure reform, initiated by the Financial Secretary, Mr. Donald Tsang. This reform is essential for Hong Kong to enhance its competitiveness and reinforce its position as an international financial centre," a SAR Government spokesman said.

"We look forward to the sanction by the Court of the merger on October 11. We are also drafting the enabling legislation for the merger, with the target of introducing the bill to the Legislative Council in November 1999, and the merger , if approved by legislators, to take effect in late January or early February 2000."

The Government also paid tribute to the staunch support of the leadership of the two Exchanges and Hong Kong Clearing House as well as HKEC for the merger.

The Chairman of Hong Kong Exchanges and Clearing Ltd. (HKEC), Mr. Charles Lee, also welcomed the approval by members of the two Exchanges for the proposed demutualisation and merger of the Exchanges and the Clearing Houses.

The market structure reform was introduced by the Financial Secretary in his Budget speech in March this year with the aim of strengthening the competitiveness of the securities and futures market of Hong Kong. HKEC was subsequently set up on July 8 as a holding company to pave the way for the merger.

For further information please contact Chief Information Officer, Frank Chuan.

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