The securities for which listing is sought must be freely transferable. Partly-paid securities will normally be regarded as fulfilling this condition provided that in the Exchange's view their transferability is not unreasonably restricted and dealings in them can take place on an open and proper basis. Existing issued securities which are offered for sale on an instalment payment basis, approved by the Exchange, will normally be regarded as fulfilling this condition.
Note: Since it is not common practice in Hong Kong for purchasers to register every transaction, a vendor of a partly-paid security cannot ensure that his name is removed from the register and he may therefore retain his original liability to pay further calls on the security. To demonstrate that dealings in partly-paid securities can take place on an open and proper basis, there must be either:—
|(a)||adequate arrangements have been put in place to ensure that the vendor of the partly-paid security can effectively transfer all of the liability to pay further calls on the security to the purchaser without any right of recourse; or
|(b)||the issuer has limited the amount unpaid to a maximum of 50 per cent. of the issue price and the securities will become fully paid within twelve months from the date of issue and that the issuer has made full and detailed disclosure of the peculiar risks attaching to such securities whilst they remain partly-paid; or
|(c)||the issuer has made provisions which will ensure that every trade in the securities has to be registered such that vendors of the securities do not remain as the registered holders after the settlement of the trade.|