The use of the coercive power of the state to explicitly wage war on insider trading began in 1933 with the U.S. Securities Act, Section 16 of which is a grandfather clause prohibiting insider trading in the United States and around the world. Pen @ fun @ pavilion wWw. ｂｉｑUｇE。 INFO Hong Kong's regulation of insider trading was long overdue until 1974, when criminal penalties and civil remedies for insider trading were provided for in the then Securities Ordinance. It is all the more regrettable that this provision has not yet been implemented in practice, despite its belated arrival.

In 1978, the British government amended the Securities Ordinance to systematically regulate insider trading by (1) providing a definition of insider trading, (2) establishing the Insider Dealing Tribunal to investigate and hear insider dealing cases, and (3) conferring on the Insider Dealing Tribunal and the Securities and Brokerage Commission the powers necessary to conduct investigations. Shortly thereafter, on 12 July 1980, the Financial Secretary of Hong Kong referred the first insider dealing case to the Insider Dealing Tribunal under the authority of section 141(H) of the Securities Ordinance. Since the amendment does not provide for criminal penalties for insider trading, nor does it provide civil remedies, it is not surprising that this is not effective in curbing illegal acts of insider trading in practice, and the first insider trading case ended in this way because there was insufficient evidence and the person involved did not constitute insider trading.

In the 80s, anti-insider trading legislation in the UK changed a lot. The Companies Act 1980 regulated insider dealing for the first time in Chapter 5, followed by the CompanySecurities (Insider Dealing) Act 1985 and the Financial Services Act 1986 to further expand the regulation of insider trading. In the early 90s, Hong Kong, which was heavily influenced by the United Kingdom, followed suit and embarked on a second revision of the legislation prohibiting insider trading, which was modelled on the above-mentioned legislation in the United Kingdom, and introduced two major laws regulating insider trading in the early 90s: the Securities (Disclosure of Interests) Ordinance and the Securities (Insider Dealing) Ordinance ( In-siderDealing)Ordinance)。

It can be said that the stock market crash of 1987 had a significant and far-reaching impact on Hong Kong's securities market, and there was no shortage of reasons for the insider trading behavior of relevant stakeholders. In 1988, Hong Kong introduced an information disclosure regime with the enactment of the Securities (Disclosure of Interests) Ordinance, which did not come into effect until 1991. The purpose of the Securities (Disclosure of Interests) Ordinance is to disclose the shareholdings of insiders and their changes, and to prevent insiders from using inside information to engage in securities trading. The Ordinance imposes an obligation to disclose interests to two types of persons: the management of the company, including directors, chief executives and relevant persons who actually perform the functions of directors and chief executives. In Hong Kong, the chief executive officer is a person who is employed by the company and is responsible for the company's business activities alone or jointly with others under the direct authorization of the board of directors, and the company may have one or more chief executive officers, and the other type is the majority shareholders who hold more than 10% of the voting shares of the company, and include the spouse of the majority shareholder, Minor children and institutions under their control (acorporationcontrolledbyhim). Both categories have an initial disclosure obligation at the beginning of their duties or at the beginning of their status, and thereafter are subject to ongoing disclosure if there is a change in shares or status. As for the content and timing of disclosure, the requirements of the Ordinance should be strictly observed.

The Securities (Disclosure of Interests) Ordinance (SFO) is in fact the first firewall set up in Hong Kong to prevent insider trading. However, preventive measures alone are not sufficient to deal with such a complex violation. After the firewall is breached, insider trading will encounter a more stringent legal barrier - the Securities (Insider Trading) Ordinance.

The Securities (Insider Dealing) Ordinance came into effect on 1 September 1991 at the same time as the Securities (Disclosure of Interests) Ordinance, and was subsequently amended in 1991, 1992, 1994, 1995, 1997 and 1998 to meet the needs of the development of the securities market and the punishment of insider trading. The Securities (Insider Dealing) Ordinance consists of five parts, Section 36 (originally 44 sections were originally deleted, sections 37-44) and its Annex A, Securities (Insider Dealing) (Registration of Orders) Rules.

That is to say, Hong Kong securities really began to investigate insider trading in 91. Prior to this, Hong Kong securities were riddled with ills, and insider trading was not uncommon.