Key Regulatory Updates for Hong Kong Listed Companies — January/February 2026

Introduction

This edition summarises the key developments for Hong Kong listed companies in January and February 2026, including the publication of new frequently asked questions by the Stock Exchange of Hong Kong Limited (the Stock Exchange) clarifying ongoing public float requirements. The Takeovers Executive of the Securities and Futures Commission (SFC) has reached a significant settlement agreement that addresses breaches of the Takeovers Code involving concert party holdings and the mandatory general offer obligation. Enforcement actions during the period reinforced expectations regarding directors’ duties, including obligations to avoid conflicts of interest, exercise independent judgment, safeguard company assets, and cooperate with regulatory investigations. 

Guidance Materials and FAQs by the Stock Exchange

1. Publication of Frequently Asked Questions on Company Secretary and First-Time Director Training Requirement (February 2026)

The Stock Exchange has published new FAQ 1.2 – No. 3 and FAQ 17.1 – No.8 in relation to FAQ on company secretary with multiple appointments. While the Stock Exchange does not prescribe a maximum number of company secretary appointments and will assess each situation based on its individual facts and circumstances, reference may be made to guidance published by The Hong Kong Chartered Governance Institute (the HKCGI), which recommends that its members should not hold more than nine named company secretary appointments for listed issuers without satisfying the disclosure requirements set out in its guidelines. The listed issuer must demonstrate to the Stock Exchange that, notwithstanding the multiple appointments, the company secretary is able to devote sufficient time and attention to the issuer’s governance and compliance affairs, and is able to discharge all requisite duties and responsibilities required under the applicable laws, rules, and regulations. 

The Stock Exchange has also updated FAQ 1.1 – No. 4 to provide that for directors appointed by a listed issuer before its listing on the Main Board or GEM of the Stock Exchange, the 18-month period to complete the minimum training hours will be counted from the date of listing of such listed issuer. 

2. Publication of Frequently Asked Questions on Public Float Requirement (February 2026)

The Stock Exchange has published the new FAQ 7 – No. 2-5, addressing the public float requirement. Please see key points below:

• The Stock Exchange expects a listed issuer to change its reliance from the Initial Prescribed Threshold to the Alternative Threshold only if, upon completion of certain corporate actions or other events, its public float falls below the Initial Prescribed Threshold. Therefore, a listed issuer cannot change its reliance to the Alternative Threshold while it is still in compliance with the Initial Prescribed Threshold.
• If a listed issuer has been granted a temporary waiver under Rule 13.33(1) of the Rules Governing the Listing of Securities on the Stock Exchange (Listing Rules) for a public float shortfall following completion of a general offer, it is still required to include a statement of non-compliance with the public float requirement in each monthly return and annual report during the waiver period and prior to the public float being restored.
• If a listed issuer with a public float shortfall has been suspended from trading for other reasons, it may combine its required monthly public float update and quarterly post-suspension update into a single announcement published at least quarterly, covering both the float status/restoration plan and progress on other resumption conditions.

For further details, please refer to FAQ 7.

Disciplinary Actions by the Stock Exchange for Failure to Comply With Disclosure Requirements

1. Disciplinary Action against Sterling Group Holdings Limited and Three Directors (January 2026)

Key Points

Every director is required to comply to the best of his/her ability with the Listing Rules and use his/her best endeavours to procure the issuer’s compliance. For this purpose, directors must understand and, at all times, be aware of their responsibilities under the Listing Rules, and ensure that the listed issuer has in place adequate and effective risk management and internal control systems to identify and comply with the applicable Listing Rule requirements.

Directors are specifically reminded that whilst financial assistance may be considered justified for commercial reasons and/or intended only to serve a short-term financing purpose, this does not override the obligations of issuers and their directors to strictly comply with the Listing Rules. Financial assistance that is not compliant with the Listing Rules may give rise to concerns about misappropriation or misapplication of the issuer’s assets and may warrant the most severe disciplinary sanction under the Listing Rules.

The Stock Exchange censured: 

• Sterling Group Holdings Limited (the Company)
• Ms. Wong Mei Wai Alice (Ms. Wong), executive director (ED), chairperson, and CEO of the Company
• Mr. Siu Yik Ming (Mr. Siu), ED of the Company 
• Mr. Chung Sam Kwok Wai (Mr. Chung), former ED of the Company 

It was further directed that Ms. Wong and Mr. Chung attend 24 hours of training on regulatory and legal topics and Listing Rule compliance. Mr. Siu was directed to attend 21 hours of training on regulatory and legal topics and Listing Rule compliance. 

Facts

• The Company trades apparel products through its subsidiary, Sterling Apparel Limited (SAL).
• At the material time, Ms. Wong and her son, Mr. Siu, were directors, and Mr. Chung was the CFO of SAL.
• JP Outfitters Inc. (JPO), who had been a customer of the Company and its subsidiaries (the Group) for decades, encountered liquidity issues at the material time.
• Considering that if JPO could not continue its operation SAL would not receive any repayment and could only write off the outstanding receivables, Ms. Wong and Mr. Chung decided to provide financial support to JPO (including supporting its IPO application). Accordingly, they procured SAL to conduct the following transactions (the Transactions): 
  • Letters of Support: Four letters of supports from the Company (signed by Ms. Wong and/or Mr. Chung on its behalf), agreeing to continue supplying inventories to JPO and to not collect any trade receivables from JPO until JPO succeeded in its IPO on the NASDAQ and received the IPO proceeds.
  • Santai Advances: Interest-free and unsecured advances of US$4.2 million from the Company (procured by Ms. Wong and Mr. Chung) to JPO and its holding company, Santai Global Asset Management Limited (Santai), without any written agreement or fixed repayment dates.
  • Director Advances: Payments of US$700,000 by the Company for subscribing shares in JPO in the names of Ms. Wong and Mr. Siu. The payments, together with interest, were fully repaid by Ms. Wong and Mr. Siu about a week thereafter.

Findings of Breach

The Listing Committee found as follows:

• The Company breached Rules 13.13, 14.34, 14.38A, 14.40, 14A.34, 14A.35, 14A.36, 14A.46, 14A.49, 14A.55, 14A.56, and 14A.71(6) as the Company failed to comply with the applicable announcement, circular, and independent shareholders’ approval requirements under the Listing Rules, in respect of the Transactions. 
• Ms. Wong and Mr. Chung breached Rules 3.08 and 3.09B(2):
  • They failed to exercise reasonable skills, care, and diligence in conducting the Transactions and failed to safeguard the Group’s assets and interests.
  • Ms. Wong and Mr. Chung failed to seek approval from, discuss with, or even inform the board before procuring SAL to provide the Letters of Support and Santai Advances.
  • The Director Advances gave rise to a conflict of interest. Nonetheless, neither Ms. Wong nor Mr. Chung took any steps to avoid such conflict or sought the board’s approval.
  • The Transactions constituted notifiable transactions, connected transactions, advances to entities, and/or continuing connected transactions for the Company. However, Ms. Wong and Mr. Chung failed to procure the Company’s Listing Rule compliance.
• Mr. Siu breached Rules 3.08 and 3.09B(2):
  • He failed to exercise reasonable skills, care, and diligence to safeguard the Group’s assets and interests in respect of the Director Advances.
  • He was aware that the Director Advances were intended for subscribing shares in JPO in the names of Ms. Wong and himself, giving rise to a conflict of interests. However, he did not take any steps to avoid such conflict or seek the board’s approval. He also failed to procure the Company’s Listing Rule compliance.

Conclusion

The Listing Committee decided to impose the sanctions and directions set out in the above. For further details, please refer to the statement of disciplinary action.

2. Disciplinary Action Against Starjoy Wellness and Travel Company Limited and Directors (January 2026)

Key Points

Directors must act in good faith and in the interests of the issuer, but not in the interests of a controlling or specific shareholder of the issuer. Where an individual is a director of both the issuer and its shareholder, he/she must avoid conflicts between the shareholder’s interests and the issuer’s. To safeguard against abuse of powers, directors must ensure the issuer has in place adequate and effective risk management and internal controls. Directors are reminded that when approving a transaction, each of them must exercise his/her own judgment on whether the transaction is in the issuer’s interest. A director rubber-stamping a decision based on another management member’s prior approval without independent judgment of his/her own is a clear dereliction of director duties. The Stock Exchange will hold directors accountable for their failure to discharge these important duties. Such a failure calls into question whether the individual concerned is suitable to be a director of the issuer.

The Stock Exchange:

• censured Starjoy Wellness and Travel Company Limited (formerly known as Aoyuan Healthy Life Group Company Limited) (Starjoy Wellness);
• imposed a director unsuitability statement and censure against Mr. Guo Zi Ning (Mr. Guo ZN), former chairman, CEO, and non-executive director (NED) of Starjoy Wellness and former vice chairman, CEO, and ED of China Aoyuan Group Limited (China Aoyuan, together with Starjoy Wellness, the Companies);
• imposed a prejudice to investors’ interests statement and censure against Mr. Chen Zhi Bin (Mr. Chen), former NED of Starjoy Wellness and former CFO and ED of China Aoyuan, and Mr. Zheng Wei (Mr. Zheng), former ED of Starjoy Wellness;
• censured Mr. Guo Zi Wen (Mr. Guo ZW), NED and former chairman and ED of China Aoyuan; Mr. Zhang Jun (Mr. Zhang), former NED and former ED of China Aoyuan; Mr. Ma Jun (Mr. Ma), former NED and former ED of China Aoyuan; Mr. Chan Ka Yeung Jacky (Mr. Chan), former ED of China Aoyuan; Mr. Cheung Kwok Keung (Mr. Cheung), independent non-executive director (INED) of China Aoyuan; Mr. Hu Jiang (Mr. Hu), former INED of China Aoyuan; Mr. Ruan Yongxi (Mr. Ruan), NED of Starjoy Wellness; Mr. Tao Yu (Mr. Tao), former ED of Starjoy Wellness; Mr. Hung Ka Hai Clement (Mr. Hung), INED of Starjoy Wellness; Dr. Li Zijun (Dr. Li), INED of Starjoy Wellness; Mr. Wang Shao (Mr. Wang), INED of Starjoy Wellness; and
• criticised Mr. Lee Thomas Kang Bor (Mr. Lee), INED of China Aoyuan.

It was further directed that:

• Mr. Guo ZW, Mr. Zhang, Mr. Ma, Mr. Chan, Mr. Cheung, Mr. Hu, and Mr. Lee each attend 17 hours of training on regulatory and legal topics and Listing Rule compliance; and
• Mr. Ruan, Mr. Tao, Mr. Hung, Dr Li, and Mr. Wang each attend 26 hours of training on regulatory and legal topics and Listing Rule compliance.

Facts

• This case concerns breaches of the Listing Rules by Starjoy Wellness and the relevant directors relating to the provision of financial assistance by Starjoy Wellness and its subsidiaries (SW Group) to China Aoyuan and its subsidiaries excluding SW Group (CA Group).
• China Aoyuan was listed on the Stock Exchange’s Main Board in October 2007.
• Starjoy Wellness was spun off from China Aoyuan and listed on the Main Board on 19 March 2019 under its former name, Aoyuan Healthy Life Group Company Limited.
• In or around 2021, China Aoyuan faced an imminent liquidity issue with substantial outstanding liabilities.
• Between 1 January 2021 and 31 March 2022, SW Group transferred RMB 3.3 billion to CA Group via 147 transactions, involving (i) mostly short-term advances provided to CA Group directly or (ii) pledges of bank deposits (Pledged Deposits) provided to secure bank loans obtained by independent borrowers, which in turn transferred the loan proceeds to CA Group (collectively, the Transfers).
• At the time of the financial assistance, Starjoy Wellness was a subsidiary of China Aoyuan.
• The Transfers were executed under a centralized working capital arrangement run by China Aoyuan’s finance and treasury centre. At the time, the treasury centre was managed by Mr. Guo ZN, who acted as the ultimate decision-maker and approver for transfers within the group.
• Trading in the shares of Starjoy Wellness and China Aoyuan was suspended on 1 April 2022 upon discovery of the Transfers.
• The Transfers, on an aggregated basis, constituted (i) advances to an entity and (ii) major and connected transactions of Starjoy Wellness, which did not comply with the written agreement, announcement, circular, and/or (independent) shareholders’ approval requirements under Chapters 13, 14, and 14A of the Listing Rules.
• Starjoy Wellness inaccurately disclosed two Pledged Deposits of RMB 500 million in total as “bank balances and cash” instead of “restricted bank deposits” in the interim results and interim report for the six months ended 30 June 2021.
• The Transfers caused significant liquidity pressure on SW Group.
• The Transfers were found to be executed without the approval or knowledge of the board of China Aoyuan or Starjoy Wellness.
• Mr. Guo ZN was the mastermind behind the Transfers. As a director of both Companies, he failed to avoid or manage conflicts of interest and duty. He put the interests of China Aoyuan above those of Starjoy Wellness and knowingly caused significant liquidity pressure on Starjoy Wellness. He arranged and approved SW Group executing the Transfers without seeking approval from the board of Starjoy Wellness, and failed to procure Starjoy Wellness’ compliance with the applicable requirements under Rule 2.13(2), Chapters 13, 14, and 14A of the Listing Rules.
• Mr. Chen approved 118 of the 147 Transfers, some while serving as a Starjoy Wellness NED, failed to manage conflicts, and did not procure compliance despite his knowledge of the Listing Rules requirements. 
• Mr. Zheng approved 122 of the Transfers because Mr. Guo ZN had approved the same without independent judgement or ensuring Rule compliance. He did not exercise his independent judgement on whether the Transfers were in the interests of Starjoy Wellness. Nor did he seek approval from the board of Starjoy Wellness.
• Although there was no evidence that Mr. Ruan or Mr. Tao approved the Transfers, they were, or should have been, aware from monthly reports of Starjoy Wellness, and they failed to take sufficient action to safeguard Starjoy Wellness’s interests or ensure compliance.
• The relevant directors failed to ensure that China Aoyuan and/or Starjoy Wellness had in place adequate and effective internal controls.

Findings of Breach

• Starjoy Wellness breached (a) Rule 2.13(2) for failing to disclose the Pledged Deposits in its 2021 interim report; and (b) Rules 13.13, 13.15, 13.20, 14.34, 14.38A, 14.40, 14A.34, 14A.35, 14A.36, and 14A.46 for failing to comply with the written agreement, announcement, circular, and/or (independent) shareholders’ approval requirements regarding the Transfers.
• Mr. Guo and Mr. Chen breached Rules 3.08 and 3.09B(2) by failing to act in Starjoy Wellness’ interests; manage conflicts; exercise due skill, care, and diligence; and procure Listing Rule compliance. Each caused, or knowingly participated in, Starjoy Wellness’ contraventions, attracting Rule 2A.10B(3) liability.
• The Listing Committee concluded by reason of Mr. Guo ZN’s serious and repeated failure to discharge his responsibilities under the Listing Rules that he is unsuitable to occupy a position as director or within senior management of China Aoyuan, Starjoy Wellness, or any of their respective subsidiaries.
• Because of the conduct of Mr. Chen, his occupation of the position of director or senior management for China Aoyuan, Starjoy Wellness, or any of their respective subsidiaries may cause prejudice to the interests of investors.
• Mr. Zheng breached Rules 3.08 and 3.09B(2) for failing to (i) act in the interests of Starjoy Wellness; (ii) exercise reasonable skill, care, and diligence; and (iii) procure Starjoy Wellness’ compliance with the Listing Rules. Mr. Zheng occupying the position of director or senior management of Starjoy Wellness or any of its subsidiaries may cause prejudice to the interests of investors.
• Mr. Ruan and Mr. Tao breached Rules 3.08 and 3.09B(2) for failing to exercise reasonable skill, care, and diligence and procure Starjoy Wellness’ compliance with the Listing Rules.
• The relevant directors breached Rule 3.08 for failing to exercise reasonable skill, care, and diligence and procure China Aoyuan and/or Starjoy Wellness to have adequate internal controls and procedures in place at the material time.

Conclusion

The Listing Committee decided to impose the sanctions and directions set out in the above. For further details, please refer to the statement of disciplinary action. 

Disciplinary Actions by the Stock Exchange — Others

1. Disciplinary Action Against a Former Director of Skyfame Realty (Holdings) Limited (January 2026)

Key Points

Cooperation with the Stock Exchange and the SFC is essential. Directors are reminded to fully cooperate with the Stock Exchange and the SFC in their investigations. Failure to cooperate in the Stock Exchange and the SFC’s investigations is a serious breach of the Listing Rules and may result in the most serious disciplinary sanction. A director’s obligation to cooperate does not lapse after his or her resignation.

The Stock Exchange imposed a director unsuitability statement and censure against Mr. Yu Pan (the Director), a former ED and chairman of Skyfame Realty (Holdings) Limited (the Company). 

Facts

• As part of an investigation into whether the Company and/or its directors had committed offences contrary to the Securities and Futures Ordinance, the SFC sent interview and investigation notices and reminder emails to the Director.
• The Director did not respond to the SFC’s requests and enquiries.
• Upon the SFC’s referral, the Listing Division (the Division) investigated the Director’s failure to respond to the SFC’s investigation and whether the Director had discharged his duties and obligations under the Listing Rules.
• The Division sent investigation and reminder letters to the Director. The Director did not respond to the Division’s enquiries.

Findings of Breach

The Listing Committee found as follows:

• The Director breached the Listing Rules by failing to cooperate with the Division and the SFC in their respective investigations.
• The Director’s failure to discharge his responsibilities under the Listing Rules was serious.

Conclusion

• The Listing Committee decided to impose the sanctions set out in the above.

For further details, please refer to the statement of disciplinary action.

2. Disciplinary Action Against a Former Director of Jiayuan Services Holdings Limited (January 2026)

Key Points

Cooperation with the Stock Exchange is essential. Failure to cooperate in the Stock Exchange’s investigation is a serious breach of the Listing Rules. Directors are reminded that their obligation to cooperate does not lapse after their resignation.

The Stock Exchange imposed a director unsuitability statement and censure against Mr. Wang Huimin, former independent NED of Jiayuan Services Holdings Limited (referred to below as the Director).

Facts

• Under Rules 3.09C and 3.20 of the Listing Rules, the Director is obliged to (i) cooperate in any investigation conducted by the Division and/or the Listing Committee, (ii) promptly and openly answer any questions addressed to the Director, and (iii) provide up-to-date contact information to the Stock Exchange for a period of three years from the date on which the Director ceases to be a director, failing which any documents or notices sent by the Stock Exchange to the last known address on record shall be deemed to have been served on the Director.
• As part of an investigation into, amongst other things, whether the Director had discharged the duties and obligations under the Listing Rules, the Division sent investigation and reminder letters to the Director.
• The Director did not respond to the Division’s enquiries.

Findings of Breach

The Listing Committee found as follows:

• The Director breached the Listing Rules by failing to cooperate with the Division in the investigation.
• The Director’s failure to discharge the responsibilities under the Listing Rules was serious.

Conclusion

• The Listing Committee decided to impose the sanctions set out in the above. For further details, please refer to the statement of disciplinary action.

3. Disciplinary Action Against Two Former Directors of Regal Partners Holdings Limited (January 2026)

Key Points

Full cooperation with the Stock Exchange is essential. Directors must respond completely and promptly to all of the Stock Exchange’s investigations and enquiries. Selective or partial cooperation will be considered as a failure to cooperate. Directors must also provide up-to-date contact information to the Stock Exchange for the purposes of the Stock Exchange’s investigation. Failure to do so will also be regarded as non-cooperation. Failure to cooperate in the Stock Exchange’s investigation is a serious breach of the Listing Rules and may result in the most serious disciplinary sanction.

The Stock Exchange imposed a director unsuitability statement and censure against the following former directors of Regal Partners Holdings Limited (formerly known as Morris Home Holdings Limited) (the Company):

• Mr. Zou Gebing (Mr. Zou), former chairman, ED, and CEO
• Mr. Shen Zhidong (Mr. Shen), former ED

Facts

• In January 2025, the Stock Exchange imposed a Prejudice to Investors’ Interest Statement and a public censure against Mr. Zou and Mr. Shen (collectively, the Directors) for their breach of directors’ duties and obligations under the Listing Rules regarding a guarantee provided by a subsidiary of the Company to secure a sum owed by Mr. Zou’s privately held company to a third party in October 2021. Mr. Zou and Mr. Shen cooperated with the Stock Exchange in this investigation.
• After the conclusion of investigation into the guarantee, the Division became aware of allegations in relation to other possible breaches of the Listing Rules by the Company’s directors. The Division then investigated whether the Directors had discharged their duties and obligations under the Listing Rules.
• As part of the investigation, the Division sent investigation and reminder letters to each of the Directors. Mr. Zou responded to some but not all of the Division’s enquiries. Mr. Shen did not provide any substantive response to the Division’s enquiries.

Findings of Breach

The Listing Committee found as follows:

• The Directors breached the Listing Rules by failing to cooperate with the Division in the investigation:
  • Mr. Zou refused to cooperate in the Division’s investigation by expressly telling the Division not to contact him anymore, ignoring the Division’s request for his up-to-date contact information, and failing to respond to all of the Division’s enquiries.
  • Mr. Shen failed to make any submission to the Division’s enquiries, despite his acknowledgement of receipt of the Division’s correspondence.
• The Directors’ failure to discharge the responsibilities under the Listing Rules was serious.

Conclusion

The Listing Committee decided to impose the sanctions set out in the above. For further details, please refer to the statement of disciplinary action.

Takeover Matters

1. Settlement From the Takeovers Executive of the SFC Regarding the Settlement With Sino Wealth International Limited and Clear Prosper Global Limited in Relation to Giordano International Limited (February 2026)

The Takeovers Executive (Executive) of the SFC, Sino Wealth International Limited (Sino Wealth), and Clear Prosper Global Limited (Clear Prosper) have reached a settlement agreement (Settlement) in relation to dealings by their parent company, Chow Tai Fook Nominee Limited (CTFN, and together with its parents and their respective subsidiaries, CTFN Group) and its concert parties (Relevant Concert Group) in the shares of Giordano International Limited (Giordano). The Settlement relates to what the Executive considers to be breaches of The Codes on Takeovers and Mergers and Share Buy-backs (Codes) by the Relevant Concert Group, including Best Sincere Limited (Best Sincere) and Firstrate Enterprises Limited (Firstrate). Specifically, the Settlement cites failure to make a mandatory general offer (MGO) required under Rule 26 and breach of Rule 5 in relation to the voluntary general offer.

Facts

• Giordano is a listed company on the Main Board of the Stock Exchange.
• At all material times, both Sino Wealth and Clear Prosper were wholly owned by CTFN. 
• CTFN Group has been holding shares in Giordano through Sino Wealth since 9 May 2011.
• On 23 June 2022, Clear Prosper announced a conditional voluntary general offer (VGO) for Giordano. The offer subsequently lapsed.
• Other Giordano shareholders include two private companies, namely Best Sincere and Firstrate:
  • Best Sincere first acquired Giordano shares on 26 April 2016. It was held by a former director of companies within CTFN Group and is currently held by his son.
  • Firstrate first bought Giordano shares about 18 years ago. Firstrate is, and has always been, held by another director within CTFN Group.
• Upon SFC’s investigation, the Executive considers that Best Sincere and Firstrate are acting in concert with CTFN Group in relation to Giordano shares for the purpose of the Codes. Relevant information for that consideration includes the following factors:
  • the source of funding used by Best Sincere to acquire its Giordano shares;
  • the fund flows between Best Sincere, Firstrate, and members of CTFN Group includes amounts arising from Giordano dividends;
  • the long-standing relationships between the current and past shareholders, directors, and key personnel of Best Sincere, Firstrate, and CTFN Group; and
  • representations from the shareholders and key personnel of Best Sincere and Firstrate regarding the Giordano shares held by them, in particular denials of beneficial ownerships of Best Sincere and Firstrate by their shareholders and representations that they act on instructions from a long-serving senior employee within CTFN Group in respect of these two companies.

Non-Compliance With the Codes

MGO Obligation

• On 18 May 2016, Best Sincere bought 1 million Giordano shares on the market. As a result, the Relevant Concert Group’s interest in Giordano shares crossed 30% on that date, triggering the MGO obligation at HK$3.60 per share.
• However, no general offer was made for Giordano as required under Rule 26 of the Takeovers Code. 

VGO

• On 13 September 2022, Clear Prosper announced that the VGO lapsed on the basis that the acceptance condition was not met as the total number of Giordano shares held by Clear Prosper and Sino Wealth (including shares tendered by accepting shareholders) amounted to 46.04%.
• However, if the shareholdings of Best Sincere and Firstrate had also been taken into account, the voting rights represented by Giordano shares held by the Relevant Concert Group and those tendered by accepting shareholders would have amounted to 55.09% of Giordano’s issued share capital and therefore, the VGO should have been declared unconditional on 13 September 2022.
• As the VGO was not declared unconditional on 13 September 2022, the Executive considers that this constituted a breach of Rule 5 of the Takeovers Code.

Settlement

• Under the settlement, the amount payable by Sino Wealth and Clear Prosper per Giordano share held by relevant independent shareholders is determined by comparing (i) the prices at which these shareholders should have had an opportunity to sell Giordano shares to the Relevant Concert Group under a general offer in strict compliance with the Codes and (ii) the benchmark market prices of Giordano shares.
• In agreeing to the settlement, the Executive has taken into account past Panel decisions involving failures to discharge the general offer obligation and compensation payments, the specific facts and circumstances of the current case and the time and costs required for a disciplinary hearing before the Panel. 

For further details, please refer to the executive statement. 

Conclusion

Issuers should review the new FAQs on public float requirements to ensure compliance with the ongoing public float regime, particularly when considering changes between the Initial Prescribed Threshold and the Alternative Threshold. The SFC’s settlement in respect of the Takeovers Code reinforces the importance of properly identifying concert parties and complying with mandatory general offer obligations and other related provisions in the Codes. 

Listed companies and their directors should remain vigilant in reviewing their compliance frameworks, internal controls, and disclosure practices to align with these requirements. The disciplinary actions published during this period highlight the importance of directors’ compliance with the Listing Rules, including (i) ensuring proper authorisation and disclosure for financial assistance and connected transactions, (ii) avoiding conflicts of interest and exercising independent judgment, and (iii) maintaining full cooperation with regulatory investigations — an obligation that continues even after a director’s resignation.