Hong Kong Insider-Trade Rule Sows More Discord
As Hong Kong officials debate a proposed rule that would restrict trading by insiders, the uncertain stance of the city’s top securities regulator has complicated the matter.
Known as the blackout rule, the measure has provoked fierce opposition from Hong Kong’s business elite, who say it would be among the toughest in the world if implemented and could keep directors and other insiders from trading shares for as long as seven months of the year. The rule was set to come into effect Jan. 1, but Hong Kong postponed it to April 1 in response to the protests, and local officials are negotiating their next step.
Opponents of the rule won support last week from Eddy Fong, chairman of Hong Kong’s Securities and Futures Commission, which can scuttle the proposal. In an interview with a local newspaper, he called the blackout rule “a pain in the neck” and said the SFC should reconsider it.