On July 31, 2025, the Securities and Futures Commission ("SFC") obtained a six-year disqualification order against Mr. Zhang Yuqing, the former vice-chairman and executive director of Zhongda International Holdings Limited, for failing to fulfil his duties as a director.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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On July 31, 2025, the Securities and Futures Commission ("SFC") obtained a disqualification order in the Court of First Instance against Mr. Zhang Yuqing, the former vice-chairman and executive director of Zhongda International Holdings Limited (Zhongda). Zhang has been disqualified for six years from serving as a director or being involved in the management of any listed or unlisted corporation in Hong Kong without the leave of the court. The decision reflects the gravity of his misconduct and includes a cost order for the SFC's legal proceedings.
The legal proceedings stemmed from an SFC investigation, revealing significant misconduct by Zhang during his tenure at Zhongda. Specifically, the SFC found that Zhang failed in his duties as a director by demonstrating inadequate skill, care, and diligence. These failures included:
- Failing to block or disclose unauthorised fund transfers of RMB150 million made by two former executive directors of Zhongda (Xu Brothers) to private companies owned or controlled by them.
- Failing to disclose or prevent the sale of a 20-percent stake in “Zhongwei Bus” to a private company controlled by the Xu Brothers at a substantially undervalued price without any payment to Zhongda or its subsidiaries.
- Approving the publication of 2011 interim results that included false or misleading information due to the unauthorised fund transfers and the disposal of the stake in “Zhongwei Bus”, which he was aware of but did not report to the board.
While Zhang did not personally benefit from the unauthorised fund transfers or the disposal, the Court agreed with the SFC that a six-year disqualification was appropriate given the severity of his breaches and the substantial sums involved.
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