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Hong Kong defends plan to reduce transparency of corporate databases

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HONG KONG: Hong Kong official on Friday (April 9) defended plans to restrict public access to business searches, a move towards transparency, and media advocates warned it will hamper exposure of business transactions shady.

The semi-autonomous financial center currently maintains a company registry with a pay wall listing registered owners of companies.

The database has been used by journalists, academics and activist shareholders to unravel global monetary trails, including wealth amassed by the families of top Chinese leaders.

The new proposal will hide home addresses and ID card numbers from owners and administrators, limiting information to correspondence addresses.

Hong Kong government says change is needed to protect privacy.

“Agencies and agents working against money laundering will still be able to get the information,” Christopher Hui, Hong Kong’s secretary of financial services and treasury, told lawmakers on Friday.

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“The change is absolutely not a regression, but a development because people attach more importance to privacy,” he added.

The government says stronger protections are needed to counter doxxing – the posting of private data on the Internet.

The tactic was used by both sides of the ideological divide during the huge and often violent pro-democracy protests of 2019.

But transparency activists have reacted with concern to the decision to restrict public information.

“The business register is an important tool long used by journalists to improve accountability, expose wrongdoing and highlight important issues of public interest,” the Hong Kong Foreign Correspondents’ Club said in a recent report. communicated.

“FACILITATE CORRUPTION”

David Webb, an activist investor based in Hong Kong, said that allowing administrators to obscure their identities “reduces the ability of researchers and journalists to shine light in shady places.”

“The proposed law will facilitate corruption, fraud and other crimes, and make it easier for directors to hide from creditors,” he told Bloomberg News.

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On Thursday, Bloomberg reported that the Hong Kong International Chamber of Commerce had urged the government to reconsider the proposal, saying it was being implemented too quickly and would damage the reputation of the city’s business hub.

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The Hong Kong government made a similar attempt to change the company register in 2013, but it was shelved after a backlash, including within the financial sector, where some recognized the benefits of maintaining the public access to data.

Media exposures made possible by company searches since then have included aiding in the discovery of ships that violated North Korea’s sanctions, alleged sanctions violation deals with Iran by the Chinese telecommunications giant. Huawei, as well as businesses and properties owned by the families of China’s top executives.

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The latest planned change comes as Beijing clamps down on dissent in Hong Kong.

The city’s legislature has been cleansed of opposition and the government is unlikely to face resistance to its planned changes.

Hong Kong leader Carrie Lam has rejected calls to allow journalists to continue to have unhindered access to the database.

“I don’t see why journalists should have this privilege,” she said last month.

Local journalist Bao Choy is also currently on trial for using a vehicle registration database to investigate the perpetrators of a 2019 mob attack on democracy protesters by pro-government supporters.

Hong Kong claims to adhere to international standards to combat money laundering.

A report last year by the International Consortium of Investigative Journalists based on leaked documents revealed that Hong Kong was one of Asia’s biggest hubs for suspicious transactions between 1999 and 2017.

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