RE CHIYU BANKING CORPORATION LTD.

HCMP 2832/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2832 OF 2002

____________

____________

_____________

D E C I S I O N

_____________

1. I have before me an application made under Section 122(1B) (b) of the Companies Ordinance, Cap.32 by the Chiyu Banking Corporation Limited ("the applicant") by way of an originating summons. The applicant seeks an order that the period of six months provided in Section 122, under which the directors of the applicant should lay before the company at its annual general meeting the profit and loss accounts by 30 June 2002, be extended for a period of one month. Although the applicant is a private company, six months is the applicable period under Section 122(1A), because the applicant is a member of a group of companies of which one is not a private company.

2. The applicant is unable to satisfy this requirement because of the sudden resignation of its auditors, Arthur Andersen and Co., on 8 April 2002.

3. New auditors were appointed soon afterwards and they completed their audit of the accounts on 13 June 2002. By reason of the statutory 28-day public notice required under Sections 161BA (5) and (6) of Cap.32 for the holding of an annual general meeting of an authorised financial institution, the applicant could not comply with Section 122 which would have required the annual general meeting to be held on or before 30 June 2002. Further, the Applicant could not have given notice in advance of the required deadline of 30 June 2002, because of the applicant's duty under Section 161BA (2) to allow inspection of the accounts in advance of the annual general meeting.

4. On 20 June 2002, the applicant gave public notice for the holding of an annual general meeting on 20 July 2002 by publication in two newspapers. The originating summons was taken out on 19 July 2002. I understand from counsel that the annual general meeting was held on 20 July 2002 and the accounts had been laid before the company in general meeting.

5. Under Section 122 (1B), the court's power to grant an extension of time under this provision is discretionary and is for "any reason it thinks fit so to do".

6. In the circumstances, I am satisfied that the present case is appropriate for this discretion to be exercised. I therefore make an order that the period of six months as provided in Section 122 be extended for a period of one month from 30 June 2002 as sought in the originating summons. I make no order as to the costs of this application.