Legislative Council

LC Paper No. CB(1) 976/98-99
(These minutes have been seen
by the Administration)

Ref: CB1/BC/6/98/2

Bills Committee on
Business Registration (Amendment) Bill 1998

Minutes of meeting
held on Thursday, 10 December 1998, at 8:30 am
in Conference Room B of the Legislative Council Building

Members present :

Hon SIN Chung-kai (Chairman)
Hon HO Sai-chu, JP
Hon Albert HO Chun-yan
Hon Jasper TSANG Yok-sing, JP

Members absent :

Hon Eric LI Ka-cheung, JP
Hon Ronald ARCULLI, JP

Public officers attending :

Miss Amy TSE
Principal Assistant Secretary for the Treasury (Revenue)

Miss Vivian SUM
Assistant Secretary (Treasury) (Revenue)

Mrs Alice LAU
Assistant Commissioner of Inland Revenue

Mr CHU Yum-yuen
Chief Assessor
Inland Revenue Department

Mr Frederick KUNG
Senior Assessor
Inland Revenue Department

Mr Frederick CHUNG
Senior Government Counsel
Department of Justice

Clerk in attendance :

Ms LEUNG Siu-kum
Chief Assistant Secretary (1)2

Staff in attendance :

Ms Bernice WONG
Assistant Legal Adviser 1

Miss Becky YU
Senior Assistant Secretary (1)3

I Meeting with the Administration
(Legislative Council Brief Ref: FIN CR 3/2311/90, LC Paper Nos. LS 60/98-99, CB(1) 501/98-99(02) to (03), and 594/98-99(01) to (02))

At the invitation of the Chairman, the Assistant Director of Inland Revenue (AC of IR) briefed members on the Administration's response (LC Paper No. CB(1) 594/98-99(02)) to concerns raised by members at the last meeting on 24 November 1998.

2. While acknowledging the Administration's explanation that the Commissioner of Inland Revenue could only invoke the proposed section 6(4B) to de-register a business or branch if the court or a competent authority had decided that such a business or branch was unlawful, Mr Albert HO considered that the proposed section as drafted could not reflect the original legislative intent. He pointed out that under the proposed section 6(4B), the Commissioner could have power to remove an entry in respect of a business or branch from the Business Register if it appeared to him that the business or branch should not have been registered. AC of IR took note of Mr HO's concern and proposed to replace the phase "it appears to" with "on reasonable ground" in the proposed section 6(4B). Mr HO remained of the view that as business registration was required in many business activities such as the opening of bank accounts, de-registration would cause undue disruptions to businesses or branches. He therefore considered it necessary for the Administration to stipulate clearly in the proposed section 6(4B) that de-registration could only be effected by order of the court or by a competent authority, or else the owner of the business or branch should be allowed to show cause against the Commissioner's decision of de-registration within 21 days. Having considered Mr HO's views, AC of IR agreed to amend the proposed section 6(4B) to the effect that the Commissioner should exercise the power of de-registration only on the ground that a court or other competent authority had decided that a business or branch was unlawful.

    (Post-meeting note: The relevant Committee Stage Amendment was circulated vide LC Paper No. CB(1) 634/98-99.)

3. Members then proceeded to examine the Bill clause by clause.

Clause 1.Short title and commencement
Clause 2.Interpretation
Clause 3.Persons answerable for doing all acts, etc, required to be done
Clause 4.Official secrecy
Clause 5.Application for registration

4. No particular comments were made on these clauses.

Clause 6. Registration of business and issue of business registration certificate

5. On the proposed section 6(4D), AC of IR clarified that the Commissioner could only exercise his power to direct a business owner to register under a new business name in case the name had suggested a connection with the Government or a public body at the time of registration. For business names registered with the Inland Revenue Department (IRD) prior to establishment of the Government or a public body which suggested such a connection, the proposed section 6(4D) would not have effect on the businesses concerned. Moreover, the proposed section 6(4E) also provided for the owner to appeal against the Commissioner's decision of requiring a business to register under a different business name.

Clause 7. Payment of fees

6. In reply to Mr HO Sai-chu's question, AC of IR confirmed that IRD would refund the business registration fees to owners whose registrations had been removed by the Commissioner on the ground that the businesses concerned were unlawful.

Clause 8. Penalty for non-payment of fees

7. The Chairman remarked that the Administration might have to amend the heading of section 11 of the Business Registration Ordinance consequent upon the proposed amendment to the section. AC of IR undertook to consider the suggestion.

    (Post-meeting note: In its letter of 12 December 1998 to the Bills Committee, the Administration advised that the proposed amendment to section 11 only aimed to make the section clearer in respect of the situations where penalty provisions were applicable, the section heading, as it now stood, could still accurately describe the situations set out in the section. Therefore, amendment to the section heading was not necessary.)

Clause 9.Regulations
Clause 10.Offences
Clause 11.Exemptions
Clause 12.Appeals
Clause 13.Certification and issue of documents
Clause 14.Section added
Clause 15.Service of notices
Clause 16.Schedule 1 amended
Clause 17.Schedule 2 amended
Clause 18.Fees
Clause 19.Schedule amended

8. No particular comments were made on these clauses.

9. As members had completed scrutiny of the Bill, the Chairman advised that a report on the deliberations of the Bills Committee would be submitted for consideration of the House Committee on 18 December 1998.

II Any other business

10. There being no other business, the meeting ended at 9:30 am.

Legislative Council Secretariat
12 March 1999