[Exclusive] Li Guozhang Company Transfers and Sells Banshan Ancestral House

01 Investigation

Written by: Zhou Weiqiang Li Yinglin

2020-03-30 07:01

"Hong Kong 01" was informed that members of the Executive Council, Li Guozhang, and his family recently sold a large house in Mid-levels through a company transfer, with a valuation of about 500 million yuan. The site is subject to development restrictions imposed by the government since mid-1972 and cannot be expanded.

Li Guozhang wrote in the name of a member of the Executive Council at the end of 2018, pointing out that the government had stated in 2013 that it was actively studying the relaxation of mid-level development restrictions, but it had not been implemented, and believed that the government should lift "the old administrative measures" to increase land supply in the short term. According to the current mechanism, only the Chief Executive in Council has the power to lift restrictions on mid-level development.

The local research society said that as a member of the guild, Li Guozhang publicly proposed to speed up the implementation of a measure, which did not disclose his own interests in detail.

Li Guozhang did not respond positively through his assistant, but only said that he had always complied with the guild rules.

The Executive Council responded that the government would not disclose the operation of the Executive Council, the content of discussions, and the declaration of related interests.

Offshore company holding Baoshan Road Mansion Li Guozhang's rejection declaration at the end of February

Since Li Guozhang was appointed as a member of the guild in 2012, Eight Star Glory Ltd, which he and his siblings serve as directors, has been reporting to hold a property in the Central and Western District. He deleted this item on February 19, which means that Li Bu Hold the equity of the house. According to regulations, members of the guild are not required to declare the detailed address of the property, that is, the outside cannot know the location of the property in the Central and Western District.

Executive Council member Li Guozhang and his family previously sold their ancestral homes at No. 21 Baoshan Road, Mid-Levels, in the Mid-Levels Development Restricted Area, through a company transfer. The valuation is about 500 million yuan. (Photo by Zhang Haowei)

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Search data show that the property in the Central and Western District is actually the former residence of Li Guozhang's father, Li Fushu, at 21 Baoshan Road, Mid-levels. The mansion is currently held by an offshore company. Hong Kong company registration documents show that the directors are Li Guobao (brother Li Guozhang), Li Guozhang and four other family members. They have resigned as directors on February 18, and the two new directors are the stock market. Celebrities Luo Yuxi and Deng Qiaomei are estimated to be new buyers of the land, but the distribution of equity before and after the change of house is unknown.

The site of the mansion is located in the Mid-Levels Development Restricted Area. In 1972, in order to avoid deepening the traffic load in the area, the government decided to adopt administrative measures to automatically reject any application for expansion and amendment of the lease in the area. The restricted area ranged from Caine Road to Baoshan Road (see photo).

The reporter checked the title deed of the ancestral house's land and found that the land had a height limit of 35 feet. It was also stipulated that only one family could live in it. The data showed that the total floor area of ​​the house was 8,250 square feet. Subject to the "tightening spell" restricted by the development of Mid-Levels, even if the Town Planning Board allows the land to be up to 10 storeys high and the plot ratio can be increased by about 4 times according to the building regulations (that is, the buildable floor area can be increased to over 70,000 square feet) However, the Lands Department will always refuse to modify the land lease and land premium application, so the value of the land is greatly depressed. According to the Land Registry, since the title was granted in 1974, there is no record of revising the title, which means that it is still subject to the restrictions on mid-level development.

The current deed of 21 Po Shan Road is limited to two floors, with a maximum height of 35 feet and a reconstruction limit of 4,992 square feet.

Since the transaction was conducted through the transfer of an offshore company, the outside world cannot know the transaction price. With reference to the market price in the region, the current transaction price of the land is estimated to be 400 million to 600 million yuan. Even if the new buyer enters the market in the name of the first individual, there is no need to pay spicy tax and save at least tens of millions of yuan in stamp duty. However, Li Guozhang and his family sold the house by way of company transfer, and only paid 0.2% stamp duty, which is about 1 million. yuan. If the development restriction is lifted, the land lease can be expanded to about 4 times the plot ratio in the future, and the value of the plot of land can increase to about 1 billion yuan.

Li Guozhang's article in the previous year advocated the removal of the restrictions, and did not disclose the ownership of the large house in the area

The Mid-level Development Restriction applies to Mid-Levels and Pok Fu Lam, and the Chief Executive in Council has the power to lift the restrictions. For example, in 1985, the Governor in Council approved the lifting of some restrictions on Pok Fu Lam for the development of Huagui Village; The Hong Kong Government has also approved the lifting of the restriction as a conservation plan for "Jessville", 128 Pok Fu Lam Road.

In the first policy address of Liang Zhenying in 2013, he stated that he would actively study to relax or lift the restrictions on the development of Pok Fu Lam and Mid-Levels for more than 40 years, becoming one of the focal points of the policy address at that time. (Government Information Office)

After reviewing the information, Li Guozhang wrote an article in the main newspaper as a member of the Executive Council on October 9, 2018, entitled "Building East Lantau City as a Dreamland for Hong Kong People". The text suggested that the government should lift the "mid-level development restriction", To increase short-term land supply. Li Yuwen reiterated that in the policy address of the Liang Zhenying government in 2013, he was actively studying the relaxation or cancellation of administrative measures currently applicable to Pok Fu Lam and Mid-levels on Hong Kong Island, restricting the sale of new land or revising deferred performance rights, and lifting the development of the two districts. The restriction also refers to the improvement of traffic in the mid-levels, but the lifting has not been implemented. "So far, after many years, I still only hear the stairs can't be heard, and the plan that could be used for short-term land use has become impossible." "Do you still need to stick to this old administrative measure?" The full text or main opinion is quoted by multiple media. However, Li Guozhang never mentioned in his article that he held a large house in the "Mid-level Development Restricted Zone", and about half a year after the publication of the article, Li Guozhang and his family launched the market for tender.

Li Guozhang wrote an article in the main newspaper as a member of the Executive Council on October 9, 2018, advocating that the government should increase short-term land supply by lifting the "mid-level development restrictions". (Screenshot of Unity Hong Kong Fund Website)

Li Yongda, Chen Jianqing: The personal interests of the author should be disclosed

"Land Supervision" Chairman Li Yongda said that the guild's declaration only required to fill in the properties in the Central and Western District, and basically no one would know that the land held by Li Guozhang was located in the restricted development zone.

Li Yongda said that Li Guozhang, who is currently the highest-level adviser to the government, has the opportunity to make government officials think that it is the highest opinion of the government.

Li Yongda went on to say that Li Guozhang had been in politics for many years and was also a former Chief of Education and Manpower. Although he was rich, he would not own much of the land in the urban area. Li Yongda pointed out that Li Guozhang did not evade suspicion and did not follow the general disclosure code of politicians.

"Land Supervision" Chairman Li Yongda believes that Li Guozhang does not evade suspicion and does not comply with the general disclosure code of politicians (profile picture)

Li Yongda pointed out that because Li Guozhang did not disclose the interests of the dwelling house land at the time of writing, and the current transaction involves the transfer of offshore companies, the public has no way of knowing the details of the sale. Otherwise, there will be a lot of reasonable doubts.

Chen Jianqing, a member of the local research society, also pointed out that Li Guozhang publicly urged the government to revoke a restricted development zone, and he originally had a plot of land in the zone, saying he did not avoid suspicion. Chen also believes that the current guild only requires members to list on which holding property, it is not enough, at least the street where they are located, otherwise the public cannot monitor it.

Li Guozhang: always strictly comply with declared interests

Li Guozhang responded through his assistant, stating that he had always strictly followed the established procedures to declare the personal interest to be declared to the Executive Council. As for the agenda and discussion content of the Executive Council, it cannot be provided based on the principle of confidentiality. Asked about the transfer of EIGHT-STAR GLORY LTD, which holds the land of the ancestral home, due to the obligation of confidentiality, it could not be provided.

Li Guozhang responded through his assistant, stating that he had always strictly followed the established procedures to declare the personal interest to be declared to the Executive Council. (Profile picture)

The Executive Council Secretariat responded to the inquiry and stated that in accordance with the principle of confidentiality of the Executive Council, the government would not disclose the operation of the Executive Council, the content of discussions, and the declaration of related interests. The government has an effective mechanism to check whether the Chief Executive and other members of the guild have any potential conflict of interest in handling matters of the executive council.

Li Guozhang and his family recently sold a large house in Mid-levels by company transfer, with a valuation of about 500 million yuan. The site is subject to development restrictions imposed by the government since mid-1972 and cannot be expanded.

The Li Guozhang family holds 21 Baoshan Road, Mid-Levels:

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