Speaking to the South China Morning Post on Monday, executive director of the Asia-Pacific Association of Chartered Certified Accountants, Allen Blewitt suggested that Hong Kong needs to establish a single financial regulator, modelled on the UK's Financial Services Authority (FSA).
The Hong Kong government has, for some time now, been keen to address the perceived conflict of interest created by the fact that the current stock market regulator, Hong Kong Exchanges and Clearing (HKEx) is also itself a profit-making listed firm.
The authorities initially proposed that the Securities and Futures Commission (SFC) should assume HKEx's regulatory duties, a suggestion which was swiftly rebuffed by the exchange.
In October, however, the government made another attempt at forcing a resolution of the conflict of interest, putting forward four proposed models in a public consultation paper.
These were: to allow the SFC to assume the regulatory role, to establish a new regulator, to allow HKEx to set up a subsidiary to handle its listing functions, or to expand the dual-filing system currently shared by the SFC and HKEx for approving new listings.
Mr Blewitt told the SCMP that:
"It would be better if the government let the Securities and Futures Commission take over the regulation work of Hong Kong Exchanges and Clearing as a first step to prepare for the setting up of a single regulator. This would be the most effective way of solving the conflict of interest at HKEx."
According to reports, however, both HKEx and the Hong Kong Stockbrokers Association have expressed a preference for the establishment of a subsidiary listings body.
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