Hong Kong Ordinances

COMPANIES ORDINANCE - SECT 44B

Allotment of shares and debentures to be listed on stock exchange

(1) Where a prospectus, whether issued generally or not, states that
application has been or will be made for permission for the shares or
debentures offered thereby to be listed on any stock exchange, any allotment
made on an application in pursuance of the prospectus shall, whenever made, be
void if the permission has not been applied for before the 3rd day after the
first issue of the prospectus or if the permission has been refused before the
expiration of 3 weeks from the date of the closing of the subscription lists
or such longer period not exceeding 6 weeks as may, within the said 3 weeks,
be notified to the applicant for permission by or on behalf of the stock
exchange. (Amended 6 of 1984 s. 259)

(2) Where the permission has not been applied for as aforesaid, or has been
refused as aforesaid, the company shall forthwith repay without interest all
money received from applicants in pursuance the prospectus, and, if any such
money is not repaid within 8 days after the company becomes liable to repay
it, the directors of the company shall be jointly and severally liable to
repay that money with interest at the rate of 8 per cent per annum from the
expiration of the 8th day: Provided that a director shall not be liable if he
proves that the default in the repayment of the money was not due to any
misconduct or negligence on his part.

(3) All money received as aforesaid shall be kept in a separate bank account
so long as the company may become liable to repay it under subsection (2);
and, if default is made in complying with this subsection, the company and
every officer of the company who is in default shall be liable to a fine.
(Amended 7 of 1990 s. 2)

(4) Any condition requiring or binding any applicant for shares or debentures
to waive compliance with any requirement of this section shall be void.

(5) For the purposes of this section, permission shall not be deemed to be
refused if it is intimated that the application for it, though not at present
granted, will be given further consideration.

(6) This section shall have effect-

   (a)  in relation to any shares or debentures agreed to be taken by a person
        underwriting an offer thereof by a prospectus as if he had applied
        therefor in pursuance of the prospectus; and

   (b)  in relation to a prospectus offering shares for sale with the
        following modifications, that is to say-

        (i)    references to sale shall be substituted for references to
               allotment;

        (ii)   the persons by whom the offer is made, and not the company,
               shall be liable under subsection (2) to repay money received
               from applicants, and references to the company's liability
               under that subsection shall be construed accordingly; and

        (iii)  for the reference in subsection (3) to the company and every
               officer of the company who is in default there shall be
               substituted a reference to any person by or through whom the
               offer is made and who knowingly and wilfully authorizes or
               permits the default. (Added 78 of 1972 s. 13) [cf. 1948 c. 38
               s. 51 U.K.]