Financial regulators like to talk tough and Hong Kong's Securities and Futures Commission (SFC) is no exception. On May 10 this year Martin Wheatley, chairman of the SFC, While speaking at a symposium of the Independent Commission Against Corruption (ICAC) called enforcement a "strategic priority" of the SFC and called again for statutory backing for full disclosure requirements under the Listing Rules. Hong Kong's courts and legislators appear in the mood to back the regulator up. On two separate occasions in the first half of this year the courts have handed down custodial sentences for market manipulation in cases brought by the SFC. Legislators have just approved the formation of the new Financial Reporting Council (FRC), an independent and statute-backed body to investigate auditing and financial reporting irregularities at Hong Kong-listed companies. The FRC is expected to begin operations later this year.
Hong Kong's government is committed to entrenching Hong...