Annex II

立法會立法會立法會立法會Legislative Council

Legal Service Division Report onSubsidiary Legislation Gazetted on 5 July 2002

Date of tabling in LegCo : 8 July 2002

Amendment to be made by : 16 October 2002 (or 6 November 2002 ifextended by resolution)

PART I SHIPPING AND PORT CONTROL

Shipping and Port Control Ordinance (Cap. 313)Shipping and Port Control (Amendment) Regulation 2002 (L.N. 117)

This Regulation amends the Shipping and Port Control Regulations (Cap.313 sub. leg.) ("the Regulations") in the following aspects:-

(a) to prohibit vessels with an overall length exceeding 10 metres fromentering into a newly created Kap Shui Mun Special Area from the south-eastern and north-eastern boundaries of the Special Area and to specifythe geographical co-ordinates which define the Area and its relevantboundaries;

(b) to additionally require vessels of 300 tons gross or less (other thanexempted ones) to tender a pre-arrival notification to the Director ofMarine under regulation 6A of the Regulations. Two types of vesselsare exempted. The first is vessels licensed in Hong Kong in accordancewith the regulations made under Part IV of the Shipping and Port ControlOrdinance (Cap. 313). The second is ferry vessels plying between HongKong and Macau, between Hong Kong and other places of China as wellas those engaged on short international voyage; and

(c) to require information on intended berth or anchorage on arrival to beadditionally provided to the Director of Marine in the pre-arrivalnotification or report.

2. For background information about this Amendment Regulation, Membersmay refer to LegCo Brief (ref: MA 60/1(2002) Pt. 4) issued by the EconomicDevelopment and Labour Bureau on 5 July 2002. The policy aspects of the

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Amendment Regulation have been discussed at the meeting of the LegCo Panel onEconomic Services on 25 February 2002. Members did not raise any specificcomments on the proposed imposition of a restricted area in the Kap Shui Mun Fairwayto improve navigational safety. Members also supported the proposal to requirevessels of any tonnage (other than the exempted ones) to tender a pre-arrivalnotification to the Director of Marine for more effective control over vessels.

3. No drafting problem has been identified in this amendment Regulation.It shall come into operation on a day to be appointed by the Secretary for EconomicDevelopment and Labour by notice published in the Gazette.

Shipping and Port Control Regulations (Cap. 313 sub. leg.)Shipping and Port Control Regulations (Amendment of Third and SeventhSchedules) Notice 2002 (L.N. 123)

4. This Notice amends the Third and Seventh Schedules to the Shipping andPort Control Regulations (Cap.313 sub. leg.) to re-align the existing Northern Fairway,the Western Quarantine Anchorage and the Western Dangerous Goods Anchorage forthe better safety of vessels using the Fairway or Anchorages.

5. No drafting problem has been identified in this Notice. It shall comeinto operation on a day to be appointed by the Director of Marine by notice published inthe Gazette.

PART II WASTE DISPOSAL FACILITIES

Waste Disposal Ordinance (Cap. 354)Waste Disposal (Designated Waste Disposal Facility) (Amendment) Regulation2002 (L.N. 118)

Waste Disposal Ordinance (Cap. 354)Waste Disposal (Refuse Transfer Station) (Amendment) Regulation (L.N. 119)

6. The Waste Disposal (Designated Waste Disposal Facility) Regulation(Cap. 354 sub. leg.) was made in April 1997. It empowers the Director ofEnvironmental Protection to maintain order and to deter the evasion of charges payableby any person in connection with any relevant activity in any designated waste disposalfacility. L.N. 118 amends the Schedule made under the Regulation to:-

(a) update the address of West Kowloon Transfer Station; and

(b) add Yung Shue Wan Station, Sok Kwu Wan Station, Ma Wan Station andNorthwest New Territories Transfer Station ("NWNTTS") to the list ofDesignated Waste Disposal Facilities.

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7. The Waste Disposal (Refuse Transfer Station) Regulation (Cap. 354 sub.leg.) regulates the use of refuse transfer stations which are intermediary waste receptionfacilities where wastes are collected and then compacted before they are shipped inbulk to landfills for final disposal. L.N. 119 adds NWNTTS and Ma Wan Station tothe Schedule to the Waste Disposal (Refuse Transfer Station) Regulation (Cap. 354 sub.leg.) as refuse transfer stations and prescribe charges for the disposal of waste at thesestations.

8. For background information about these 2 amendment Regulations,Members may refer to the LegCo Brief (ref: EFB 9/55/03/64) issued by theEnvironment and Food Bureau on 26 June 2002. The policy aspects of theseamendment Regulations were discussed at the meeting of the LegCo Panel onEnvironment Affairs on 27 May 2002. While no objection was raised on the proposedamendments, doubts were cast on the level of charges. According to theAdministration, the waste collection trade has been consulted prior to the setting ofcharges and the user-pays principle applies in determining the level of charges.

9. Both Amendment Regulations shall come into operation on a day to beappointed by the Secretary for the Environment, Transport and Works by noticepublished in the Gazette. No drafting problem has been identified in theseRegulations.

PART III PLACES OF PUBLIC ENTERTAINMENT

Places of Public Entertainment Ordinance (Cap. 172)Places of Public Entertainment Ordinance (Amendment of Schedule 1) Regulation2002 (L.N. 120)

Places of Public Entertainment Ordinance (Cap. 172)Places of Public Entertainment (Exemption) Order (L.N. 121)

10. The Places of Public Entertainment Ordinance (Cap. 172) ("theOrdinance") provides for the regulation of places of public entertainment in that noperson shall keep or use any place of public entertainment without a licence grantedunder the Ordinance. Schedule 1 to the Ordinance specifies the events, activities orother things which are regarded as "entertainment" under the Ordinance.

11. L.N. 120 amends Schedule 1 to include "dance party" as one of the events,activities or other things referred to as entertainment for the purpose of the Ordinance."Dance party" is defined as an event with all of the following attributes:-

(a) music or rhythmic sound of any kind or source is provided at the event;

(b) the primary activity at the event is dancing by the persons attending theevent; and

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(c) either the number of persons attending the event exceeds 200 on at leastone occasion during the event, or any part of the event occurs between2 p.m. and 6 p.m.

12. Under section 3A of the Ordinance, the Secretary for Home Affairs mayby order published in the Gazette exempt places of public entertainment from theapplication of the Ordinance or any part thereof. L.N. 121 is an exemption order madeunder section 3A of the Ordinance. The following places are exempt from theoperation of section 4 (requirements to obtain a licence) and section 11 (magistrates'power to close places of public entertainment used in contravention of the provisions ofthe Ordinance) of the Ordinance as regards any dance party:-

(a) places that are under the management of the Leisure and CulturalServices Department or the Home Affairs Department;

(b) places issued with a liquor licence under the Dutiable Commodities(Liquor) Regulations (Cap. 109 sub. leg.);

(c) places that are club-houses under the Clubs (Safety of Premises)Ordinance (Cap. 376); and

(d) places issued with a public dance-hall licence under the MiscellaneousLicences Ordinance (Cap. 114).

13. For background information about the above Regulations, Members mayrefer to the LegCo Brief issued by the Home Affairs Bureau in July 2002. At itsmeetings on 10 July and 6 December 2001, the Panel on Security was consulted on theAdministration's proposals to regulate rave parties and other dancing activities atpremises not licensed for dancing activities under the ambit of the Places of PublicEntertainment Ordinance, and to exempt certain places of public entertainment fromfurther licensing under the Ordinance. A member expressed support for theAdministration's proposals, and suggested that it should be a licensing condition that adance party organiser should try to take all practicable steps to prevent drug dealing andabuse within the party venue. A member expressed objection to the Administration'sproposals to require a person to apply for a licence before holding a dance party or raveparty, as the licensing requirement would control people's activities. Another memberexpressed concern about the time taken for the issue of a licence under the Ordinance,which was estimated to be 40 to 50 days. The member urged that the processing timeshould be shortened. In view of the concerns raised at the Panel meeting, Membersmay consider to form a sub-committee to examine these 2 items of subsidiarylegislation.

14. L.N. 120 shall come into operation on a day to be appointed by theSecretary for Home Affairs by notice published in the Gazette. L.N. 121 shall come

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into operation on the commencement of L.N. 120.

PART IV SOLICITORS' GROUP PRACTICE RULES

Legal Practitioners Ordinance (Cap. 159)Solicitors (Group Practice) Rules (L.N. 122)

15. The Solicitors (Group Practice) Rules are made by the Law Society ofHong Kong under section 73 of the Legal Practitioners Ordinance (Cap. 159). Section73 of the Legal Practitioners Ordinance provides for, amongst other things, regulationof solicitors' practice in Hong Kong.

16. The new Rules provide that 2 or more solicitors or firms of solicitorsconducting their businesses from the same address "separately but in mutual co-operation" are members of a group practice. They also provide that the members of agroup practice must maintain a company incorporated with limited liability, of whichonly member solicitors or principals of member firms are eligible to be directors orshareholders.

17. No member of a group practice shall publicise or otherwise promote hisfirm's practice in a manner that gives an impression that the group practice is a firm or alegal entity of any kind or that any member of the group practice is in partnership withany other member of the same group practice. (section 10(1)). However, for thepurposes of any rule of professional practice, conduct or discipline relating to conflictof interest or confidentiality, the various member solicitors and principals of membersfirms of a group practice shall be regarded as practising in partnership with each other(section 11(2)). Except as otherwise provided by express mention or necessaryimplication, nothing in the new Rules is to be construed as providing that any membersolicitor or principal of a member firm of a group practice is for any purpose to beregarded as practising in partnership with any other member solicitor or principal of amember firm of the group practice.

18. The new Rules or its background has not been referred to any LegCoPanel. The Law Society has been requested to supply background and technicalinformation about the new Rules and its replies are attached for Members' reference(Appendix ).

19. According to the Law Society, the purpose of establishing this new modeof practice is to enable solicitors to share premises, staff and facilities and thus lowertheir overheads and to provide an environment in which they would have the support ofother solicitors and assist one another.

20. The Law Society has published an article to introduce the concept of thisnew mode of practice in the Hong Kong Lawyer in June 1998 and invited its membersto express views on the same. The Law Society has also consulted its professional

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indemnity insurer on the proposed solicitors' group practice. The Law Society doesnot envisage that such a new mode of practice will substantially impact on the users oflegal services, therefore formal consultation with the general public has not beencarried out.

21. The new Rules shall come into operation on a day to be appointed by thePresident of the Council of The Law Society of Hong Kong by notice published in theGazette. In order to better assess the new rules, including the likely impact that maybe brought about by the new Rules, Members may consider to form a sub-committee toexamine them.

Encl

Prepared by

CHENG Kit-yee KittyAssistant Legal AdviserLegislative Council Secretariat

LS/S/39/01-022869 94572877 5029

Mr Patrick Moss By Fax (2877 2069) and By PostGeneral SecretaryThe Law Society of Hong Kong 26 August 20023/F, Wing On House71 Des Voeux RoadCentralHong Kong

Dear Mr Moss,

Solicitors (Group Practice) Rules (L.N. 122 of 2002)

Thank you very much for your reply to my letter dated 20 August 2002.

I would be obliged if you could provide further assistance on thefollowing questions:-

1. Group Practice - Sharing of Profits Amongst Member Firms/Solicitors

Perhaps I should clarify question (f) in my letter of 9 August 2002. Myconcern is whether individual member firms or individual member solicitors of agroup practice will be permitted to share profits.

You said in your letter that the objective of a group practice (which iscoined as "chambers system") is to, amongst other things, "provide an environment inwhich they would have the support of other solicitors and assist one another" (para. (a),p.1).

I appreciate that rule 4 of the Solicitors' Practice Rules (Cap. 159 sub.leg.) prohibits solicitors from sharing profit costs with any person not being a solicitorpractising in Hong Kong. You said that "[t]his rule applies to a member of a grouppractice as it applies to any other solicitor. Members of a group practice however arenot allowed to share solicitors. Please see rule 4(4) of the Rules" (para (f), p.2).

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Rule 4 of the Solicitors Practice Rules contains no sub-rule (4), so Iassume you were referring to section 4(4) the new Solicitors (Group Practice Rules)(hereinafter referred to as "GPR") in that paragraph. Please correct me if I amwrong.

Section 4(4) of the GPR provides as follows:-

"For avoidance of doubt, only a solicitor or firm that isconducting his or its business as a member of a group practicemay be a party to the group practice agreement in relation to thatgroup practice."

Could you clarify whether or not individual member firms or individualmember solicitors of a group practice will be permitted to share profits under section4(4) or any other provisions of the GPR and/or the Solicitors Practice Rules.

Further, please explain the meaning of "[m]embers of a group practicehowever are not allowed to share solicitors" in your letter.

2. Defining Liability

Rule 5 of the Legal Profession (Group Practice) Rules, 1999 ofSingapore expressly provide that each firm in a group practice shall be liable for andduly and punctually pay and discharge its own debts and liabilities. The Singaporeanmodel of group practice also provides that each member firm shall bear its ownprofessional indemnity premia.

Please explain why no express provision is made in the GPR to definethe liabilities of member firms or member solicitors in a group practice.

What is the legal basis for your assertion that "[e]ach member will beliable for its own breach of the applicable rules and regulations. As an independentfirm, each member is required to maintain its own professional indemnity insurance"(para. (f), p.3)?

3. Management Company with Limited Liability

It is not mandatory for group practice of solicitors in Singapore tomaintain a company with limited liability to manage the group practice. The

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Singaporean rules only provide that a group practice may be managed by a managerand such manager may provide, or firms in a group practice may otherwise share, "theinfrastructure and management services which may be required for the efficient andproper functioning of the group practice" (rule 7, Legal Profession (Group Practice)Rules, 1999 of Singapore). The scope of "infrastructure" and "management services"is clearly defined in the Singaporean rules.

Please explain why, under the GPR, it is mandatory for a group practiceto be managed by a company incorporated with limited liability.

4. Transparency of the Group Practice Management Company

Section 8(1)(c) of the GPR provides that the members of a grouppractice shall notify the Law Society certain information in relation to the grouppractice. Section 8(3) of the GPR provides that, except on a formal resolution of theCouncil of the Law Society, the particulars furnished under section 8(1)(c) shall not bedisclosed by the Secretary General of the Law Society to any person other than thosepersons specified in section 8(4) (e.g. Law Society Council members, a SolicitorsDisciplinary Tribunal, etc).

Your explanation is that a similar requirement in relation to informationin the annual employees' return submitted by a law firm is provided in rule 5(4) of theSolicitors' Practice Rules.

However, the information referred to in section 8(1)(c) of the GPRcontains more than just personal particulars of employees. Rule 8(1)(c)(i) refers tothe name of the management company, address of its registered office and it respectiveregistration numbers under the Companies Ordinance (Cap. 32) and the BusinessRegistration Ordinance (Cap. 310). Rule 8(1)(c)(ii) refers to the names of thedirectors and shareholders of the management company. Rule 8(1)(c)(iii) refers tothe address of the management company together with its telephone, fax, telex and DXnumbers.

Furthermore, provision similar to section 8(1)(c) of the GPR is containedin rule 5(1A) of the Solicitors' Practice Rules. The non-disclosure provision in rule5(4) of the Solicitors' Practice Rules reads as follows:-

"Except upon formal resolution of the Council, the particularsfurnished under subrules (1)(f), (2) in respect of particularsreferred to in subrule (1)(f), and (3) shall not be disclosed …."

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Hence, rule 5(4) of the Solicitors' Practice Rules does not forbiddisclosure in respect of information submitted under rule 5(1A). Please kindly clarifythe position.

5. Consultation

The GPR represents a significant change in the practice of solicitors inHong Kong. Please advise whether consultation has been carried out within the legalprofession, the insurance industry which issues professional liability insurance and thepublic, particularly the consumers (e.g. through the Consumer Council) who will beaffected by the new system.

6. Amendment to Professional Conduct Guidelines

In view of the important changes brought by the GPR, will there be anyconsequential amendment to the Hong Kong Solicitors' Guide to ProfessionalConduct?

7. Overseas Experience

You mentioned that "chambers practices" are permitted in Singapore,England and New South Wales of Australia. Your enclosure on the Singaporeanrules is most helpful. Would you also supply for Members' information the relevantrules and/or information in respect of England and New South Wales?

I would be most grateful if you could let me have a reply (in bothChinese and English languages) at your earliest convenience, preferably before3 September 2002.

Yours sincerely,

Kitty ChengAssistant Legal Adviser

cc. Legal AdviserCAS(2)3Jonathan Abbott, D of J

LS/S/39/01-022869 94572877 5029

Mr Patrick Moss By Fax (2877 2069) and By PostGeneral SecretaryThe Law Society of Hong Kong 9 August 20023/F, Wing On House71 Des Voeux RoadCentralHong Kong

Dear Mr Moss,

Solicitors (Group Practice) Rules (L.N. 122 of 2002)

I refer to our previous telephone conversation regarding the abovesubsidiary legislation ("Group Practice Rules") tabled before the LegislativeCouncil on 10 July 2002.

I am in the course of preparing a report on the Group Practice Rulesto the House Committee of the LegCo. I wonder if you could kindly provideinformation on the following questions to assist Members to understand theintention and the technical aspects of the Group Practice Rules :-

Background

(a) Solicitors in Hong Kong traditionally practise either as sole proprietoror in partnership. The Group Practice Rules appear to be a newdevelopment of the professional practice of solicitors. Would youprovide some information about the background and the rationale ofthis new development?

(b) Would you also advise Members that whether there are examplessimilar to the Group Practice Rules in other common lawjurisdictions?

Group Practice - Definition and Operation

(c) Section 3(1) provides that, for the purposes of the Group Practice

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Rules, 2 or more solicitors or firms conduct their businesses asmembers of a group practice "if they conduct their businesses (or anypart of their businesses) from the same address, separately but inmutual co-operation". Please explain, with examples if possible, themeaning of "separately but in mutual co-operation".

(d) Are member solicitors or member firms of a group practice allowed toact for respective parties in a transaction where separaterepresentation is required?

(e) Are monies held on trust on behalf of clients deemed to be trustmonies held by individual member solicitor(s), member firms or thegroup practice?

(f) Will members of a group practice be allowed to share profits and/orliability of the group practice?

Group Practice Management Company

(g) Section 7 provides that every group practice shall maintain anincorporated company with limited liability and the objects of suchcompany shall be limited to "matters relating to the management ofthe affairs of the group practice or the members of the group practiceas such" (subsection (2)). Please explain, with examples if possible,the precise meaning of the provision "matters relating to themanagement of the affairs of the group practice or the members of thegroup as such".

(h) Please also explain why it is mandatory for a group practice tomaintain a management company with limited liability whilesolicitors' practice is not incorporated.

(i) Section 8(1)(c) provides that the members of a group practice shallnotify the Law Society certain particulars in relation to the grouppractice, e.g. the name and address of the group practice managementcompany, the names of the directors and shareholders of themanagement company and identity of the employees of themanagement company. Section 8(3) provides that, except on aformal resolution of the Council of the Law Society, the particularsfurnished under section 8(1)(c) shall not be disclosed by the SecretaryGeneral of the Law Society to any person other than those personsspecified in section 8(4) (e.g. Law Society Council members, aSolicitors Disciplinary Tribunal, etc). Please explain the purpose formaking such a provision.

Power of Waiver

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(j) Section 12 provides that the Council of Law Society may waive anyof the provisions of the Group Practice Rules in a particular case,either conditionally or subject to such conditions as it may think fit toimpose. What are the circumstances in which the Council of LawSociety anticipate it will exercise this power of waiver and whichaspect(s) of the Group Practice will probably be subject to suchwaiver?

I would be most grateful if you let me have a reply at your earliestconvenience, preferably before 23 August 2002.

Yours sincerely,

Kitty ChengAssistant Legal Adviser

cc. Legal AdviserCAS(2)3Jonathan Abbott, DoJ