Legislative Council

LC Paper No. CB(3) 881/98-99 (01)

Ref.: CB(3)/C/1 (II)

Paper for the Committee on Members' Interests' meeting
on 15 December 1998

Acceptance of financial sponsorship from anonymous sources

This paper invites members' views on whether Members of the Legislative Council should or should not, as a matter of principle, accept financial sponsorship from anonymous sources.


2. At the meeting of the Committee on Rules of Procedure ("CRoP") on 24 November 1998, the question was raised as to whether Members should accept financial sponsorship from anonymous sources. As the subject falls within the purview of the Committee on Members' Interests ("CMI"), the CRoP asked for the matter to be referred to CMI for consideration.

Current Rule and practice relating to the acceptance of financial sponsorship

3. Rule 83(5)(d) of the Rules of Procedure relates to the acceptance of financial sponsorship by Members as Members of the Council. It reads:

    "83. Registration of Interests

      (5) In this Rule, "registrable interests" means -

        (d) financial sponsorships, as a Member of the Council, by any person or organization, stating whether any such sponsorships include any payment or any material benefit or advantage to the Member or his spouse, whether direct or indirect;"

4. There is no provision prohibiting the acceptance of financial sponsorship from anonymous sources. The standing practice is that all financial sponsorship received by Members is required to be registered. According to the Guidelines on Registration of Interests issued to Members in July 1998,

    " the requirement of Rule 83(5)(d) is that Members register their acceptance of financial sponsorships as defined in the Rules of Procedure. Regarding the "financial sponsorships" received from a Member's political organization …it would suffice if a Member merely registers interests directly received from his political organization. Such registrable interests include cash subsidy of HK$5000 or above each month. Whether or not the acceptance of a particular financial sponsorship is in contravention of the provisions of the Prevention of Bribery Ordinance is a matter for the Member to decide for himself having regard to his own knowledge of circumstances."

To the knowledge of the Secretariat, since the establishment of the register, no anonymous donations have been declared and registered by Members.

Deliberations by the current and previous CMIs on the acceptance of financial sponsorship

5. The current CMI has not discussed whether a Member should accept financial sponsorship from anonymous sources after taking office. It has only discussed the subject of donations received during elections to the Legislative Council. In this connection, it has recommended that all donations (anonymous or otherwise), should be registered and a Member would be deemed to have satisfied this requirement by providing the Clerk with a copy of the statement of donations for submission to the returning officer appointed by the Electoral Affairs Commission under section 29 of the Corrupt and Illegal Practices Ordinance (Cap. 288).

6. According to available records, neither had the previous CMIs discussed the subject, although there had been extensive discussions about the acceptance of donations towards a Member's election expenses.

The rule and practice of other countries in respect of acceptance of financial sponsorship from anonymous sources

The United Kingdom

7. Anonymous donations are not specifically covered by the House of Commons Rules on the Registration of Financial Interests. However, there is a precedent case on this subject. A complaint was made to the former Committee on Members' Interests that a Member, who was then Chancellor of the Exchequer, had failed to register an anonymous gift. The Committee ruled that anonymous donations were, in principle, registrable. The conclusion of the Committee was: "Prudence suggests that a Member of Parliament should not normally accept a gift or benefit proffered anonymously. If, however, after making reasonable inquiries, a Member decides that such a benefit can properly be accepted, and if the benefit is one which is otherwise covered by the House's rules of registration, then the committee considers that the benefit should be registered in the normal way, at the time that it is received. The fundamental maxim for any Member of Parliament when deciding whether or not to register a financial interest is: 'if in doubt, register, or at least consult the Registrar'. That maxim, which was not followed in the particular case before us, applies to anonymous benefits as much as to any other, and if heeded, can be a protection to individual Members and to the House as a whole." The question has not arisen since.


8. According to the Clerk of the House of the Parliament of Australia, there is no prohibition on Members receiving donations from anonymous sources. However, no such donations have been received or declared.


9. There is no rule on anonymous donations or on financial sponsorship.

The United States

10. Section 102 (a)(2)(A) of the Ethics in Government Act of 1978 requires the registration of "the identity of the source, a brief description, and the value of all gifts aggregating more than the minimal value as established by section 7342(a)(5) of title 5, United States Code, or US$250, whichever is greater, received from any source other than a relative of the reporting individual during the preceding calendar year, except that any food, lodging, or entertainment received as personal hospitality of an individual need not be reported, and any gift with a fair market value of $100 or less, as adjusted at the same time and by the same percentage as the minimal value is adjusted, need not be aggregated for purposes of this subparagraph." Section 7342(a)(5) of title 5 of the United States Code reads, "minimal value" means a retail value in the United States at the time of acceptance of $100 or less, except that -

  1. on January 1, 1981, and at 3 year intervals thereafter, "minimal value" shall be redefined in regulations prescribed by the Administrator of General Services, in consultation with the Secretary of State, to reflect changes in the consumer price index for the immediately preceding 3-year period; and

  2. regulations of an employing agency may define "minimal value" for its employees to be less than the value established under this paragraph;"

In summary, in the United States, the source of all gifts received during the preceding calendar year, the aggregate value of which when taken together exceeds US$250, has to be registered.

The issue

11. It is for members to decide whether or not to recommend that Members should not accept financial sponsorship from donors who insist on anonymity.

12. Members may wish to consider whether it is practicable to expect a Member concerned to be able, in all circumstances, to identify a sponsor, who for example, directly credits to the Member's bank account anonymously, to return the sponsorship. If it is considered that the Member should still not accept the sponsorship even though he would not be able to do so, members should consider the means through which the Member may dispose of such sponsorship without breaching any rule. In this regard, members may refer to the provision of section 29(2B) of the Corrupt and Illegal Practices Ordinance (Declaration of election expenses) which reads:

    " Any donation of $500 or more which is not accompanied by sufficient detail so as to identify and locate the donor shall not be retained but shall be disposed of in accordance with section 8B(2)(b)(iii)."

And section 8B(2)(b)(iii) reads:

    "(2) Any donation which has not been used in accordance with subsection (1) or which exceeds a sum equivalent to the maximum scale of election expenses prescribed under section 13(1) as respects a particular election -

      (b) shall -

        (iii) by reason of the impracticality of returning that donation for any other reasonable cause (including the size of the donation otherwise to be so returned),

        be used for the purpose of benefitting such charitable institution or trust of a public character as the candidate may select."

13. Members are invited to consider the following options:

  1. that Members should not accept financial sponsorship from anonymous sources; and that all such donations should be donated to charitable organizations; in this connection, it is necessary to consider whether the Rules of Procedure should be amended accordingly or whether it would suffice only to amend the Guidelines, as marked-up in note (d) in the Appendix; or

  2. that the status quo be maintained, i.e. a Member should decide whether or not to accept and retain any particular financial sponsorship, having regard to his own knowledge of circumstances.

The way forward

14. Subject to the views of members, the Committee may inform the CRoP of its recommendation or, if necessary, issue a consultation paper to seek the views of Members.

The LegCo Secretariat
10 December 1998


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