The discussion regarding the abolish of the minimum stock brokerage commission framework was held at the Financial Affairs Panel of the Legislative Council. [CB(1)1248/02-03(03)] March 28, 2003
Release Date: 2003-03-28
Reference: SC20030318/1042
Written Statement from the Hong Kong Securities and Futures Industry Staff Union
To: The Task Force of the Financial Services and the Treasury Bureau, the Securities and Futures Commission, and Hong Kong Exchanges and Clearing Limited:
Since the official removal of the minimum commission rule, some securities companies have laid off back-office staff, some brokers have exited the market more quickly, and there are banks and some brokers engaging in malicious commission reductions, leading to extreme chaos in the securities industry. Following our meeting with the task force in February, we were extremely disappointed because the task force seemed helpless in addressing the current plight of the securities industry. In the past two months, the task force has not undertaken any substantial work. The originally planned second round of meetings has been postponed to the eve of the implementation of the new securities law, which makes us even more doubtful of the government's sincerity.
Recently, Legislative Council member Chan Yuen-han, on behalf of our union, submitted a written inquiry to the Secretary for Financial Services and the Treasury, Frederick Ma, asking whether the Hong Kong government had assessed the unemployment situation in the industry following the cancellation of the minimum commission rule. Secretary Ma admitted that the government could not assess the impact, which reflects an extremely irresponsible attitude and poor quality of the government officials. In February, we conducted another survey among industry insiders, who estimated that after the commission elimination, incomes would fall by half or more, leading to more company closures and unemployment. Therefore, representing the industry, the Hong Kong Securities and Futures Industry Staff Union requests the task force to answer the following questions:
1. Last year, the government shelved the cancellation of the minimum commission rule due to high unemployment. This year, with unemployment rising again, why does the government ignore the adverse effects of unemployment in the industry and strongly direct the Hong Kong Exchanges and Clearing Limited to implement the cancellation of the minimum commission rule?
2. Can the government provide solid and genuine reasons to support such a hasty removal of the minimum commission rule, or is the government only listening to a minority opinion and creating pressure for the industry to comply?
3. If the cancellation of the minimum commission rule leads to chaos in the industry, massive unemployment, and company closures, in violation of Tung Chee-hwa's government's policy of "reducing unemployment and supporting SMEs," who will be held responsible?
We hereby submit this letter for your attention and action.
Sincerely,
Wong Kwok-on
Chairman
Hong Kong Securities and Futures Industry Staff Union
March 18, 200
Written Statement from the Hong Kong Securities and Futures Industry Staff Union
To: The Task Force of the Financial Services and the Treasury Bureau, the Securities and Futures Commission, and Hong Kong Exchanges and Clearing Limited:
Since the official removal of the minimum commission rule, some securities companies have laid off back-office staff, some brokers have exited the market more quickly, and there are banks and some brokers engaging in malicious commission reductions, leading to extreme chaos in the securities industry. Following our meeting with the task force in February, we were extremely disappointed because the task force seemed helpless in addressing the current plight of the securities industry. In the past two months, the task force has not undertaken any substantial work. The originally planned second round of meetings has been postponed to the eve of the implementation of the new securities law, which makes us even more doubtful of the government's sincerity.
Recently, Legislative Council member Chan Yuen-han, on behalf of our union, submitted a written inquiry to the Secretary for Financial Services and the Treasury, Frederick Ma, asking whether the Hong Kong government had assessed the unemployment situation in the industry following the cancellation of the minimum commission rule. Secretary Ma admitted that the government could not assess the impact, which reflects an extremely irresponsible attitude and poor quality of the government officials. In February, we conducted another survey among industry insiders, who estimated that after the commission elimination, incomes would fall by half or more, leading to more company closures and unemployment. Therefore, representing the industry, the Hong Kong Securities and Futures Industry Staff Union requests the task force to answer the following questions:
1. Last year, the government shelved the cancellation of the minimum commission rule due to high unemployment. This year, with unemployment rising again, why does the government ignore the adverse effects of unemployment in the industry and strongly direct the Hong Kong Exchanges and Clearing Limited to implement the cancellation of the minimum commission rule?
2. Can the government provide solid and genuine reasons to support such a hasty removal of the minimum commission rule, or is the government only listening to a minority opinion and creating pressure for the industry to comply?
3. If the cancellation of the minimum commission rule leads to chaos in the industry, massive unemployment, and company closures, in violation of Tung Chee-hwa's government's policy of "reducing unemployment and supporting SMEs," who will be held responsible?
We hereby submit this letter for your attention and action.
Sincerely,
Wong Kwok-on
Chairman
Hong Kong Securities and Futures Industry Staff Union
March 18, 200