* HK rules allowing different classes of stock never used
* Discussions not necessarily related to Alibaba
By Elzio Barreto
HONG KONG, Jan 24 Hong Kong Exchanges and
Clearing Ltd (HKEx) and the Securities and Futures
Commission (SFC) will discuss a paper on new shareholding
structures for publicly traded companies in the first quarter
before putting it up for public consultation, a top exchange
official said on Friday.
The paper will touch on a broad range of topics, not just
"weighted voting rights," David Graham, chief regulatory officer
and head of listing at HKEx, told Reuters.
The move comes after Hong Kong regulators last year rejected
Internet giant Alibaba Group Holding Ltd's planned IPO after
the company requested to keep a shareholder structure that
allowed a group of top managers and founders to nominate and
control the board, while holding only around 13 percent of the
That request went against the Hong Kong's one-share-one-vote
"We've worked on a paper and we're discussing that paper
with the listing committee and the SFC. We will be working on it
during the first quarter," Graham said on the sidelines of a
regulatory forum organized by the SFC.
Discussions on the new shareholding structures are not
necessarily related to Alibaba and come more as the exchange and
city officials look to develop Hong Kong's financial markets,
"The question of looking at weighted voting rights in the
broader sense pre-dates any discussions around Alibaba. This is
not a response to Alibaba," he said.
Hong Kong rules allow for the listing of different classes
of stock with different voting rights under exceptional
circumstances, but no companies have requested that exemption in
the 26 years since it was put in place.
"For the record, we never received such a request. It's
clearly a hypothetical question," Stephen Brown, deputy chairman
of the listing committee of the HKEx said in a panel at the
forum. "We haven't used that rule exception in 26 years."