[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-seo-393644-105":3,"detail-sidebar-cat-0-en-105":81,"doc-detail-393644-en":130},{"code":4,"msg":5,"data":6},0,"ok",{"site_id":7,"language":8,"slug":9,"title":10,"keywords":11,"description":12,"schema_data":13,"social_meta":74,"head_meta":76,"extra_data":78,"updated_unix":80},105,"en","faqs-main-board-listing-rules-chapter-14","FAQs – Main Board Listing Rules - Chapter 14","","FAQs provide answers on how to assess notifiable and connected transaction implications under the Main Board Listing Rules (and equivalent GEM Rules) for transactions involving listed subsidiaries and issuers applying HKFRS/IFRS 16. Topics include share allotments and asset acquisitions by subsidiaries, classification of leases for percentage ratio computations, treatment of one-off versus continuing connected transactions, early termination of leases, and retrospective adoption requirements. Also covered is accounting for sale-and-leaseback arrangements as financing arrangements and the related classification under Chapter 14.",{"@graph":14,"@context":73},[15,34,56],{"@type":16,"itemListElement":17},"BreadcrumbList",[18,23,27,31],{"item":19,"name":20,"@type":21,"position":22},"https://docshare.wps.com","Home","ListItem",1,{"item":24,"name":25,"@type":21,"position":26},"https://docshare.wps.com/document/","Document",2,{"item":28,"name":29,"@type":21,"position":30},"https://docshare.wps.com/document/exam/","Exam",3,{"item":32,"name":10,"@type":21,"position":33},"https://docshare.wps.com/document/faqs-main-board-listing-rules-chapter-14/393644/",4,{"url":32,"name":10,"@type":35,"image":36,"author":41,"headline":10,"publisher":44,"fileFormat":47,"inLanguage":8,"description":12,"dateModified":48,"datePublished":49,"encodingFormat":47,"isAccessibleForFree":50,"interactionStatistic":51},"DigitalDocument",{"url":37,"@type":38,"width":39,"height":40},"https://docshare.wps.com/thumbnails/faqs-main-board-listing-rules-chapter-14/393644.png","ImageObject",300,407,{"name":42,"@type":43},"Mary Man","Person",{"url":19,"name":45,"@type":46},"DocShare","Organization","application/pdf","2026-11-06","2026-09-26",true,{"@type":52,"interactionType":53,"userInteractionCount":55},"InteractionCounter",{"@type":54},"ViewAction",8,{"@type":57,"mainEntity":58},"FAQPage",[59,65,69],{"name":60,"@type":61,"acceptedAnswer":62},"If a listed subsidiary issues new shares by way of a general mandate to acquire assets, how are the implications assessed for the listed parent?","Question",{"text":63,"@type":64},"The allotment of shares would be a deemed disposal by the listed parent. Depending on size tests under Main Board Rule 14.04(9) / GEM Rule 19.04(9), it may be treated as a very substantial disposal, major transaction or discloseable transaction, triggering relevant notifiable transaction requirements under Main Board Chapter 14 / GEM Chapter 19. The asset acquisition by the subsidiary is treated as an acquisition by the listed parent (or its subsidiary), with the same size-test outcomes.","Answer",{"name":66,"@type":61,"acceptedAnswer":67},"When an issuer leases as a lessee and recognises a right-of-use asset under HKFRS/IFRS 16, how is the lease classified under the definition of \"transaction\" and are revenue exemptions relevant?",{"text":68,"@type":64},"The issuer’s right-to-use asset is regarded as an acquisition of asset under Main Board Rule 14.04(1)(a). The finance lease vs operating lease classification under Main Board Rule 14.04(1)(c) or 14.04(1)(d) does not apply where the issuer acts as lessee. The revenue exemption under Main Board Rule 14.04(1)(g) does not apply because the transaction is of a capital nature.",{"name":70,"@type":61,"acceptedAnswer":71},"If the lease is entered into with a connected person, is it a one-off connected transaction or a continuing connected transaction?",{"text":72,"@type":64},"Where the lease is subject to an agreement with fixed terms, it is treated as a one-off connected transaction, i.e., an acquisition of capital assets. The continuing versus one-off treatment follows the lease’s fixed-term arrangement described in the FAQ.","https://schema.org",{"og:url":32,"og:type":75,"og:title":10,"og:site_name":45,"og:description":12},"article",{"robots":77,"canonical":32},"index,follow",{"doc_id":79,"site_id":7},393644,1790940981,{"code":4,"msg":82,"data":83},"success",[84,88,92,95,100,105,110,114,119,122,126],{"id":22,"doc_module":4,"doc_module_name":25,"category_name":85,"show_sort_weight":86,"slug":87},"Story & Novel",90,"story-novel",{"id":26,"doc_module":4,"doc_module_name":25,"category_name":89,"show_sort_weight":90,"slug":91},"Literature",80,"literature",{"id":33,"doc_module":4,"doc_module_name":25,"category_name":29,"show_sort_weight":93,"slug":94},70,"exam",{"id":96,"doc_module":4,"doc_module_name":25,"category_name":97,"show_sort_weight":98,"slug":99},5,"Comic",60,"comic",{"id":101,"doc_module":4,"doc_module_name":25,"category_name":102,"show_sort_weight":103,"slug":104},6,"Technology",50,"technology",{"id":106,"doc_module":4,"doc_module_name":25,"category_name":107,"show_sort_weight":108,"slug":109},7,"Healthcare",40,"healthcare",{"id":55,"doc_module":4,"doc_module_name":25,"category_name":111,"show_sort_weight":112,"slug":113},"Research & Report",30,"research-report",{"id":115,"doc_module":4,"doc_module_name":25,"category_name":116,"show_sort_weight":117,"slug":118},9,"Religion & Spirituality",20,"religion-spirituality",{"id":117,"doc_module":4,"doc_module_name":25,"category_name":120,"show_sort_weight":117,"slug":121},"World Cup","world-cup",{"id":123,"doc_module":4,"doc_module_name":25,"category_name":124,"show_sort_weight":123,"slug":125},10,"Lifestyle","lifestyle",{"id":127,"doc_module":4,"doc_module_name":25,"category_name":128,"show_sort_weight":96,"slug":129},19,"General","general",{"code":4,"msg":82,"data":131},{"doc_id":79,"user_id":132,"nickname":42,"user_avatar":133,"doc_module":4,"category_id":33,"category_name":29,"doc_title":10,"doc_description":12,"doc_content":134,"file_id":135,"file_url":136,"file_type":137,"file_size":138,"view_count":55,"is_deleted":4,"is_public":22,"is_downloadable":22,"audit_status":22,"page_count":139,"language":140,"language_code":8,"site_id":7,"html_lang":8,"table_of_contents":141,"faqs":142,"seo_title":143,"seo_description":12,"update_tm":144,"read_time":145,"preview_page_count":4},7421720224475,"https://ap-avatar.wpscdn.com/davatar_276721f389ce27ea32af1340a28f341c","FAQs – Main Board Listing Rules – Chapter 14  \n\n| Question:\u003Cbr>If a listed subsidiary issues new shares by way of a general mandate to acquire assets, what are the notifiable transaction implications for the listed parent? |\n| --- |\n| Answer:\u003Cbr>An allotment of shares by the listed subsidiary would be a deemed disposal for the listed parent and the transaction, depending on the size tests as defined in Main Board Rule 14.04(9) / GEM Rule 19.04(9), may fall to be treated as a very substantial disposal, major transaction or discloseable transaction of the listed parent and be subject to the relevant notifiable transaction requirements under Main Board Chapter 14 / GEM Chapter 19.\u003Cbr>Furthermore, the acquisition of assets by the listed subsidiary would constitute an acquisition of assets by the listed parent (or its subsidiary) . The transaction, depending on the size tests defined in Main Board Rule 14.04(9) / GEM Rule 19.04(9), may fall to be treated as a very substantial acquisition, major transaction or discloseable transaction of the listed parent and be subject to the relevant notifiable transaction requirements under Main Board Chapter 14 / GEM Chapter 19.\u003Cbr>FAQ Series 8, FAQ No. 41. Issue 10\u003Cbr>LR reference: Main Board Rules 14.04, 14.29 / GEM Rules 19.04, 19.29 Released on 28/11/2008 |\n| Question:\u003Cbr>An issuer will enter into a lease transaction as a lessee and recognise the right-of-use asset according to HKFRS/IFRS 16.\u003Cbr>(a) How should the issuer classify the lease under the definition of \"transaction\"?\u003Cbr>(b) Does the revenue exemption under Main Board Rule 14.04(1)(g) apply to the lease?\u003Cbr>(c) How should it calculate the percentage ratios for the lease?\u003Cbr>(d) If the lease is entered into by the issuer with a connected person, will it be treated as a one-off connected transaction or continuing connected transaction? |\n| Answer:\u003Cbr>(a) The issuer will recognise an asset representing its right to use the leased asset. This will be regarded as an acquisition of asset under the definition of transaction set out in Main Board Rule\u003Cbr>14.04(1)(a) . |\n\n\n| The classification of transaction into a finance lease or operating lease under Main Board Rule\u003Cbr>14.04(1)(c) or 14.04(1)(d) will not apply where the issuer acts as lessee.\u003Cbr>(b) No. The transaction is of a capital nature.\u003Cbr>(c) Listed issuers are required to compute the assets and consideration ratios. The numerator will bethe value of the right-of-use asset recognised by the issuer (which includes the present value of lease payments) according to HKFRS/IFRS 16.\u003Cbr>(d) Where the lease is subject to an agreement with fixed terms, it is treated as a one-off connected transaction (i.e. an acquisition of capital assets) .\u003Cbr>FAQ Series N/A, FAQ No. 045-2018\u003Cbr>LR reference: Main Board Rules 14.04(1)(a), 14.04(1)(c), 14.04(1)(d), 14.04(1)(g), 14.07, 14.22, 14.23, 14A.24(1), 14A.24(3), 14A.31 / GEM Rules 19.04(1)(a), 19.04(1)(c), 19.04(1)(d), 19.04(1)(g), 19.07, 19.22, 19.23, 20.22(1), 20.22(3), 20.29\u003Cbr>Released on 28/09/2018 |\n| --- |\n| Question:\u003Cbr>An issuer (as a lessee) has entered into a 5-year contract to lease a warehouse from a third party and recognized the right-of-use asset according to HKFRS/IFRS16 .\u003Cbr>If the issuer subsequently proposes to early terminate the lease by the end of the third year,\u003Cbr>(a) how should the issuer classify the termination of the lease under the definition of “transaction”?\u003Cbr>(b) how should it calculate the percentage ratios for the termination of lease? |\n| Answer:\u003Cbr>(a) The proposed termination of lease will result in a decrease in the amount of right-of-use asset recognised by the issuer. This will be regarded as a disposal of asset under the definition of transaction set out in Main Board Rule 14.04(1)(a) .\u003Cbr>The issuer should compute (i) the assets ratio based on the value of the remaining right-of-use (b) asset; and (ii) the consideration ratio based on the penalty or fee, if any, payable by the issuer for\u003Cbr>terminating th","cbCaitaSc9Fjkd7A","https://ap.wps.com/l/cbCaitaSc9Fjkd7A","pdf",414543,52,"English","# FAQ topics under Main Board Listing Rules - Chapter 14\n## Deemed disposals and asset acquisitions for listed parents\n## Lease classification and transaction definitions under HKFRS/IFRS 16\n## Revenue exemption and percentage ratio calculations\n## One-off vs continuing connected transactions for leases\n## Early termination of leases and ratio calculations\n## Retrospective adoption of HKFRS/IFRS 16 and re-compliance obligations","[{\"question\":\"If a listed subsidiary issues new shares by way of a general mandate to acquire assets, how are the implications assessed for the listed parent?\",\"answer\":\"The allotment of shares would be a deemed disposal by the listed parent. Depending on size tests under Main Board Rule 14.04(9) / GEM Rule 19.04(9), it may be treated as a very substantial disposal, major transaction or discloseable transaction, triggering relevant notifiable transaction requirements under Main Board Chapter 14 / GEM Chapter 19. The asset acquisition by the subsidiary is treated as an acquisition by the listed parent (or its subsidiary), with the same size-test outcomes.\"},{\"question\":\"When an issuer leases as a lessee and recognises a right-of-use asset under HKFRS/IFRS 16, how is the lease classified under the definition of \\\"transaction\\\" and are revenue exemptions relevant?\",\"answer\":\"The issuer’s right-to-use asset is regarded as an acquisition of asset under Main Board Rule 14.04(1)(a). The finance lease vs operating lease classification under Main Board Rule 14.04(1)(c) or 14.04(1)(d) does not apply where the issuer acts as lessee. The revenue exemption under Main Board Rule 14.04(1)(g) does not apply because the transaction is of a capital nature.\"},{\"question\":\"If the lease is entered into with a connected person, is it a one-off connected transaction or a continuing connected transaction?\",\"answer\":\"Where the lease is subject to an agreement with fixed terms, it is treated as a one-off connected transaction, i.e., an acquisition of capital assets. The continuing versus one-off treatment follows the lease’s fixed-term arrangement described in the FAQ.\"}]","FAQs – Main Board Listing Rules - Chapter 14 | PDF",1790391337,131]