Work Report 2014 /2015

KENNETH LEUNG

Legislative Councillor (Accountancy)

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Letter from KennethDear friends,

I trust many of you had a good summer break.

Although the Council is in recess, I have worked on some of the more urgent bills during the summer months, paid a number of visits to my constituents and met with government officials and regulators. I also managed to do some travelling and visited the former Yugoslavian states. It was a mind-opener for me - the complexities of the religious, cultural, ethnic and political conflicts in this region far exceeded what I have learnt. Travelling is always a good learning experience for me.

In the coming year, I will put my energy and focus to improving the governance of this city, the integrity of our financial system and the quality of our environment. No doubt I will keep you up-to-date of the latest developments in my monthly newsletter.

Yours sincerely,

Kenneth Leung

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Political Reform

UGL Payment to the Chief Executive

Defended the core principle of universal suffrage by rejecting the Government’s proposal for selecting the Chief Executive while advocating the need to re-establish a working relationship with the Central Government

Questioned the legitimacy of the payment of $50 million to the Chief Executive by UGL Limited (an Australian engineering and property services company) and urged relevant regulatory authorities to conduct investigation

Highlights of the year

Public Accounts Committee

Led eight public enquiry hearings to review the audit reports on Civil Aviation Department (CAD), Kenneth urged the Government to engage independent experts to assess the safety and performance of the new Air Traffic Management System, and condemned CAD’s blatant violation of the approved schedule of accommodation and requirements in the new CAD Headquarters project

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Manpower Study for the Accounting Profession

Research on Working Hours

The Government and HKICPA should jointly conduct a comprehensive manpower study on the accounting profession before making any decision whether to import accountants

In a research jointly conducted by this Office and the Hong Kong Institute of Asia-Pacific Studies of the Chinese University of Hong Kong on the legislation of standard working hours for the accounting profession, a significant number of respondents believed that standard working hours legislation is impractical to implement

Nepal EarthquakeWorked with the Chief Secretary and political parties across the spectrum to expedite the approval of $50 million by the Finance Committee via written resolution to Disaster Relief Fund for the Nepal Government to provide emergency relief for its earthquake victims

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Number of questions raised by Kenneth, second among legislators;Average number of questions raised by legislator is nine

Kenneth’s attendance rate in Council Meeting

Number of Public Hearings Kenneth led

2497%

8

5

Number of Bills Committees Kenneth joined

Number of Establishment Subcommittee Meetings Kenneth chaired

11

19Number of Panels Kenneth joined

Number of Bills Committees Kenneth chaired

44

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Bills

Contracts (Rights of Third Parties) Bill (Passed on 26 November 2014)

Arbitration (Amendment) Bill 2015 (Passed on 9 July 2015)

To remove some legal uncertainties relating to the opt-in mechanism provided for domestic arbitration and update the list of parties to the New York Convention

To change the privity of contract regime and provide for the enforcement of contractual terms by third parties

To provide for three days’ paid paternity leave with pay set at four-fifths of the employee’s average daily wages

= Chairman

Employment (Amendment) Bill 2014 (Passed on 18 December 2014)

Bills Passed

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To improve MPF system by allowing phased withdrawal of accrued benefits as an option and adding “terminal illness” as an additional ground for early withdrawal

To extend profits tax exemption for offshore funds to private equity funds

To implement concessionary revenue measures proposed in the 2015-16 Budget

To facilitate introduction of an uncertificated securities regime in Hong Kong

Mandatory Provident Fund Schemes (Amendment) Bill 2014 (Passed on 21 January 2015)

Inland Revenue (Amendment) Bill 2015(Passed on 13 July 2015)

Inland Revenue (Amendment) (No.2) Bill 2015(Passed on 9 July 2015)

Securities and Futures and Companies Legislation (Uncertificated Securities Market Amendment) Bill 2014(Passed on 27 March 2015)

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Inland Revenue (Amendment) (No.3) Bill 2015

Securities & Futures (Amendment) Bill 2015

Bills

Bills Committees in action

Bankruptcy (Amendment) Bill 2015

Clearing and Settlement Systems (Amendment) Bill 2015

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I told them (the Government) let’s work together in the post-veto era instead. They may have a pragmatic

solution, but something must be resolved with our core values which cannot be compromised.

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Panels and Committees

Panel on Economic Development

Panel on Security

Panel on Financial Affairs

Reviewed the proposal to build the Three-Runway System at Hong Kong International Airport

Recommended Hong Kong to focus on attracting high-end travellers

Expressed concerns about the safety of water cannon jet on human body and the authorisation procedures of its deployment

Advocated increase in transparency and accountability of the use of forces by the Police

Monitored the progress of the legislation proposal on Audit Regulatory Reform

Continued to work with stakeholders to eliminate core areas of concern including disciplinary procedures, funding requirements for the Financial Reporting Council and penalty levels

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Panel on Environmental Affairs

Advocated opening up of electricity power grid to distributed generation and urged the Government to push forward the development of green finance and adopt public-private partnership (PPP) in tackling environmental challenges

Establishment Subcommittee

Chaired 19 meetings during the year and approved 32 new government senior positions including an annual outlay of $95 million out of 37 new positions tabled

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Manipulation of stock prices by dissemination of false price-sensitive information through the Internet and Mainland media

There have been no prosecution cases brought against persons outside Hong Kong for the dissemination of false information in Hong Kong, and the Government claimed that the current regulations were effective.

Asian Infrastructure Investment Bank (AIIB)

The Government indicated its strong intention to join the AIIB, and participated in the discussion of the Articles of Agreement for the AIIB.

Manpower planning for financial professions in Hong Kong

Apart from launching a three-year pilot program to enhance public awareness of and talent training for the insurance and asset management sectors, the Government did not disclose similar initiatives for other professions.

The positioning of Growth Enterprise Market (GEM)

The Government replied that the Stock Exchange of Hong Kong had conducted a review of GEM and published the details in the Listing Committee Report 2014, and they would continue to monitor the operation and development of GEM.

Development of Islamic bond market in Hong Kong

The Government claimed that Hong Kong had a competitive advantage in developing RMB-denominated sukuk products.

Questions to the Government

Finance

Here is the summary of Government's replies to Kenneth's questions.

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Carbon emission audits on buildings

A total of 341 organisations and 20 government departments joined the “Green Hong Kong•Carbon Audit” to conduct carbon audits for their buildings in 2013. The audit reports suggested that carbon reduction measures could be implemented in areas including energy use, waste management, use of water and behavioural change.

Greening projects for buildings

The Government produced 119,933 m2 greened area for 143 government building projects between 2012 and 2014, and targets to increase 48,510m2 greened area for 67 building projects in the coming three years.

Hong Kong's Climate Change Strategy and Action Agenda

The Government implemented policies to enhance energy efficiency in buildings, transport, wastes management, and fuel mix for electricity generation based on the action agenda in 2010. The target is to reduce the carbon intensity by 50% to 60% in 2020 as compared with the 2005 level.

Operations to destroy fireworks

The fireworks disposal for the cancelled display scheduled on the National Day 2014 followed the normal disposal procedures stipulated in the Dangerous Goods (General) Regulations. Around 4,700 kg of fireworks are being disposed on Lantau Island annually.

Use and collection of energy-efficient lighting products

There was no separate handling of waste energy-efficient lighting products that contain harmful chemical substances.

Environment

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Body searches conducted on detainees

The Correctional Services Department planned to replace manual rectal search by low radiation X-ray body scanners. Six correctional institutions are expected to equip with scanners by 2016.

Handling reports of criminal offences allegedly committed by police officers

The Independent Police Complaints Council has been overseeing the Police investigation of all complaints relating to "Occupy Central Movement".

Inspection of Hong Kong residents’ communication by law enforcement agencies

The Government confirmed that requesting users' information from Internet Service Providers did not fall within the regulatory scope of the Interception of Communications and Surveillance Ordinance.

Agreement for the supply of Dongjiang water to Hong Kong

The utilization rate of the agreed water quota was below 90% between 2006 and 2013, except 2011. It is therefore questionable whether the pricing terms of the agreement are justifiable.

Air traffic movements at the Hong Kong International Airport

Average delay time due to China’s implementation of air traffic flow control increased from 40 minutes in 2010 to 70 minutes in 2014.

Construction costs of the Crossing Facilities for the Hong Kong-Zhuhai-Macao Bridge

The Government estimated that the cost was overrun by about $5 billion due to the rising cost of construction worker wages, construction materials and machinery in recent years.

Manpower for air traffic management

The personnel for air traffic control services are given a 30-minute rest time for every two hours of work to ensure professional working performance. The Government also claimed that the manpower was sufficient.

Public Utilities and Transportation

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Implementation of section 33 of the Personal Data (Privacy) Ordinance

Since 1995, it has been considering setting a commencement date for the provision upon completion of the preparation work. Amongst other things, the Government and the Office of the Privacy Commissioner for Personal Data commissioned a consultant to look into the required compliance measures.

Measures against money laundering

In the past five years, 1,389 persons were prosecuted with $8.47 billion assets restrained and confiscated.

Operation of immigration control points

The Government replied that they invested $947.14 million on control points’ enhancement works in recent years. They do not have any plans to impose passenger arrival tax to subsidise their operational expenses.

Personal safety of sex workers

The Police meet with sex workers on regular basis and give them general crime preventions advice such as installing CCTV or alarm in their own premises.

Police's handling of assemblies in Occupy Central Movement

The Police stated that they handled the assemblies in a professional and impartial manner with a high level of restraint.

Prosecutions about public processions and assemblies

While 955 persons were arrested during the "Occupy Central Movement", the Government claimed that the Police have sought legal advice from the Department of Justice before making prosecution in relation to public order event.

Opinion polls on constitutional development

The Government was reluctant to disclose details of the opinion poll on constitutional development including polling standard and methodology.

Law & Security

Public Utilities and Transportation

For more detailsbitly.com/LCquestions

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Seminars and Workshops

Seminars

Workshops

Participants

127

350017

Acknowledgements (in alphabetical order)

Sabrina CHAO ( 趙式明 )

Deputy Chairman, Hong Kong Shipowners Association

CHENG Yan-chee ( 鄭恩賜 )

Chief Corproate Affairs Officer and Executive Director

CHOY Chi-keung ( 蔡子強 ) Senior Lecturer, The Chinese University of Hong Kong

Candy FONG ( 房惠玲 ) Partner, National Technical and Audit, Deloitte Touche Tohmatsu

Wilson FUNG ( 馮永業 ) Executive Director, Corporate Development, Hong Kong Airport Authority

Philip HUNG ( 洪宏德 ) Executive Director, Tax Policy & Controversy, Ernst & Young

Samuel HUNG ( 洪家耀 ) Chairman, Hong Kong Dolphin Conservation Society

Paul HO ( 何耀波 ) Partner, Asia-Pacific Financial Services Tax, Ernst & Young

Regina IP ( 葉劉淑儀 ) Legislative Councillor

Vincent KONG ( 江智遠 ) Global Products and Services Development Manager, Sustainability, SGS Hong Kong Ltd.

Timothy LEAR ( 李賢 ) Executive Director (Operations), Hong Kong Competition Commission

LEW Mon-hung ( 劉夢熊 )

Chloe MOK ( 莫玉君 ) Senior Consultant, Carbon Care Asia

Elizabeth TSE ( 謝曼怡 ) Permanent Secretary for Financial Services & the Treasury (Treasury)

Kelvin YAM ( 任健峰 ) Member of the Law Society's constitutional and human rights committee

YAU Shing-mu ( 邱誠武 ) Under Secretary for Transport & Housing

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Work Report 2014 /2015

KENNETH LEUNG

Legislative Councillor (Accountancy)

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E-mail

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Phone

Fax

Kenneth's Vision

Room 918, Legislative Council Complex,1 Legislative Council Road, Central, HK

info@kennethleung.hk

www.kennethleung.hk

2352 3209

3020 9849

Office of the Hon Kenneth Leung

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