Enduring powers of attorney

Unlike a conventional power of attorney, an enduring power of attorney (EPA) must be in the prescribed form and witnessed by a solicitor and a medical doctor. As at 1 December 2007, only 21 EPAs had been registered in Hong Kong in the 10 years since the Enduring Powers of Attorney Ordinance (Cap 501) (EPA Ordinance) was enacted. The Law Society has lobbied the Administration for years to review the EPA Ordinance.

In April 2007, the Law Reform Commission (LRC) issued a consultation paper on the EPA Ordinance and published its report in March 2008. The LRC adopted a number of recommendations of the
Law Society, including the abolition of the requirement that an EPA must be witnessed by a medical practitioner; the replacement of the prescribed form by a form with explanatory notes; and that publicity measures be taken by the Government in partnership with the relevant professional bodies and non-governmental organisations to increase public awareness and understanding of EPAs.

In the latest Consultation Paper entitled ‘Enduring Powers of Attorney: Personal Care’ published in July 2009, the LRC considers whether the scope of an EPA should be extended beyond the donor’s
property and financial affairs to include matters relating to the donor’s ‘personal care’; and if so, what matters that term should encompass. It also considers whether provisions should be made for the recognition in Hong Kong of EPAs executed overseas. The LRC is in favour of establishing a mechanism for ‘personal care EPAs’, the scope of which should include everyday decisions as to the donor’s health care but not
decisions involving the giving or refusing of life-sustaining treatment.

A Working Party chaired by Council member Mr Billy Ma has reviewed the latest consultation paper. The Law Society supports the extension of personal care in an EPA. The submissions of the Law Society in response to the recommendations of the LRC in the Consultation Paper are posted on www.hklawsoc.org.hk.

Legislative proposals to enhance the anti-money laundering regulatory regime in respect of the financial sectors

The Financial Services and the Treasury Bureau issued a Consultation Paper on ‘The Conceptual Framework of Legislative Proposal to enhance the Anti-Money Laundering Regulatory Regime in respect of the Financial Sectors’ in July 2009. The legislative proposal is applicable to the financial sectors only, not to the legal profession. As a self-regulatory body, the Law Society has since December 2007 introduced a comprehensive set of anti-money laundering guidelines, Practice Direction P, setting out the mandatory requirements for client identification and verification, client due diligence and record keeping by law firms. With these guidelines in place, it is not necessary for the Government to introduce anti-money laundering legislation for the legal profession.

Proposals to accelerate rights issues and open offers

Hong Kong Exchanges and Clearing Ltd (HKEx) has published a consultation paper seeking comments on the proposals to accelerate rights issues and open offers to facilitate fund raising by listed issuers. HKEx proposes to shorten the subscription period for a rights issue or an open offer from 14 calendar days to 10 business days, and the notice period for book closure from 14 calendar days to five business
days. The Law Society supports these proposals.

Consultation on increasing short position transparency

Since September 2008 a number of overseas markets have imposed emergency measures to regulate short selling. The Securities and Futures Commission (SFC) proposes to introduce short position reporting requirements under the Securities and Futures Ordinance (Cap 571) (SFO) and has published a consultation paper on increasing short position transparency. The Securities Law Committee of the Law Society has considered these proposals. The Law Society suggests that an obvious way forward would be to adjust the existing disclosure regime for short positions under Part V of the SFO rather than create an entirely new parallel regime. The submissions to the SFC by the Law Society on this consultation are posted on www.hklawsoc.org.hk.