Trading in shares of Next Digital, the parent company of Hong Kong’s largest pro-democracy newspaper Apple Daily, has been suspended at the company’s request, the operator of the Hong Kong stock exchange announced on Monday.

The government’s Security Bureau last Friday froze stocks and other assets owned by the company’s founder Jimmy Lai, citing ongoing investigations into national security law charges against him.

Next Digital building
Apple Daily’s office in Tseung Kwan O. Photo: Kelly Ho/HKFP

The company’s board said it requested the halt in trading pending an upcoming announcement about the assets freeze, “among other matters.”

The suspension was “pending the release of an announcement in relation to, among other matters, statement issued by the Hong Kong Security Bureau about freeze in the assets and shareholdings in the Company held by the Company’s controlling shareholder, Mr Lai Chee-ying, which is inside information for the Company,” it said in a statement.

Last Friday, Secretary for Security John Lee announced authorities had frozen all Next Digital shares held by Lai and bank accounts belonging to three of his other companies, warning that “a person must not, directly or indirectly, deal with” the frozen properties.

In response, Next Digital’s CEO Cheung Kim-hung said the action would not affect Apple Daily’s operations in Hong Kong.

Separately last Friday, the company announced it would scrap the print edition of the Apple Daily newspaper in Taiwan and focus instead on its online news site.

‘Soul and brain of company’

The halt in trading comes after ex-Hong Kong chief executive Leung Chun-ying called on its board over the weekend to reveal the impact of the freezing of Lai’s assets on Apple Daily’s operations before the market reopening on Monday.

Jimmy Lai
Jimmy Lai being transferred onto a Correctional Services vehicle on February 1, 2021. Photo: Studio Incendo.

“Jimmy Lai has had multiple incidents, the board of Next Media, including non-executive directors, have the responsibility to issue an official notice to small shareholders before the stock market opens tomorrow, and openly answer the five questions below and other possibly related questions, or else any small shareholders can sue the directors,” Leung wrote on his Facebook page.

“Although Jimmy Lai is no longer the president of Next Media, [he] is still the soul and brain of Next Media. Now that Jimmy Lai has been sentenced to jail, and only on the first of the many charges, how does the Next Media group assess the impact of Lai’s long-term imprisonment to the business?” the statement continued.

Other questions included the company’s capacity to repay loans and the company’s response to rumours its operations may be forced to close before July 1 and the government may take over its offices in Tseung Kwan O.

Lai, an outspoken critic of Beijing, is facing several charges relating to unauthorised assemblies during the city’s pro-democracy protests, a charge of alleged fraud relating to an office lease and two charges of colluding with foreign forces under the security law.

He is currently serving a 14-month jail sentence in connection with two unauthorised assemblies in August 2019.

He was again in court on Monday to face trial over a separate unauthorised assembly in October 2019.

As of December 2020, stock exchange filings show Lai held 71.26 per cent of voting shares in Next Digital.

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Hong Kong Free Press is a new, non-profit, English-language news source seeking to unite critical voices on local and national affairs. Free of charge and completely independent, HKFP arrives amid rising concerns over declining press freedom in Hong Kong and during an important time in the city’s constitutional development.