Washington International Law Journal


Both the United States and Hong Kong have suffered through corporate governance scandals in recent years. The two nations have tried different methods of regulating legal ethics in order to curtail future corporate governance scandals. The United States, via the Sarbanes-Oxley Act of 2002, empowered the Securities and Exchange Commission ("SEC") to dictate disclosure requirements to U.S. lawyers who represent listed corporations. This mandate creates conflicts between lawyers' duty to keep clients' secrets and their duty to disclose client information for the protection of public interests. Hong Kong took a completely different approach. The Hong Kong Stock Exchange negotiated the Memorandum of Understanding with the Hong Kong Law Society, which clarifies the scope of a solicitor's duties when practicing before the Stock Exchange. This Comment compares the United States and Hong Kong systems of regulating lawyers, specifically considering issues relating to corporate governance. It concludes that the SEC should adopt Hong Kong's style of negotiation and clarification and Hong Kong should adopt the U.S. enforcement stance and definition of the client in order to more effectively prevent corporate scandals before they start.

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