HONG KONG — Subsequent Digital, a Hong Kong media firm that has revealed vehement criticism of the Chinese language authorities for many years, stated on Sunday that it could take steps to close down after an official crackdown had left it with no approach to function.
In a press release, the corporate’s board of administrators referred to as for the liquidation of the corporate and stated that they’d resigned.
“We’ve concluded that the perfect pursuits of shareholders, collectors, staff and different stakeholders shall be served by an orderly liquidation,” it said, including that it hoped such a transfer would enable funds to collectors and former employees.
The announcement was the newest in a collection of blows to Hong Kong’s once freewheeling press, which has been stifled by the nationwide safety regulation that the mainland Chinese language authorities imposed on the previous British colony to quell dissent greater than a 12 months in the past.
Subsequent Digital’s founder and controlling shareholder, Jimmy Lai, is in jail, charged with crimes that embody violating the safety regulation. In June, Hong Kong officers froze a few of the firm’s financial institution accounts, forcing its flagship newspaper, Apple Daily, to close. A number of high editors and executives at Subsequent Digital, moreover Mr. Lai, have been charged with crimes.
Apple Each day, based in 1995, was the main pro-democracy voice within the Hong Kong media, often denouncing China’s ruling Communist Occasion and its allies within the native authorities. Its aggressiveness quickly made highly effective enemies for Mr. Lai, who was compelled to unload a clothes chain after the paper criticized a Chinese language chief in print.
Below the nationwide safety regulation, which China imposed after a wave of pro-democracy protests in 2019 that challenged its management of Hong Kong, Mr. Lai and his media empire shortly turned a goal.
Subsequent Digital stated it could have remained solvent had its financial institution accounts not been frozen. Whereas it had confronted promoting boycotts led by supporters of the Chinese language authorities, Apple Each day was extensively learn, and it sold a million copies of its final edition. Subsequent Digital’s inventory, which was suspended from buying and selling in June, had soared at instances over the previous 12 months, as supporters of Hong Kong’s pro-democracy trigger purchased shares to indicate help for the corporate.
Subsequent Digital famous that it had been compelled to shut earlier than any of the circumstances towards its senior figures had gone to trial. Its supporters have argued that the actions taken towards Subsequent Digital and its publications hurt not solely media freedom within the metropolis, but in addition property rights and Hong Kong’s status as a superb place to do enterprise.
“If you abuse state energy and freeze financial institution accounts and throw folks in jail — the editor in chief, the chief govt, the founder — it smacks of a banana republic,” stated Mark Clifford, an unbiased nonexecutive director of Subsequent Digital. “This isn’t what made Hong Kong a middle of worldwide funding or the picture that it prides itself in, with rule of regulation and safety of property rights.”
Mr. Lai is anticipated to be tried later this 12 months on a fraud cost associated to a sublease of the corporate’s headquarters, in addition to prices introduced beneath the nationwide safety regulation. These prices allege that he colluded with international powers by funding a marketing campaign that took out advertisements, in publications together with The New York Instances, that referred to as for American sanctions towards Hong Kong.
Mr. Lai based the corporate that turned Subsequent Digital in 1990 with a single journal. It grew to incorporate Apple Each day, which ultimately launched an version in Taiwan. The board’s assertion stated that the administrators had been assured that Mr. Lai would be a part of them in thanking the corporate’s readers over time.
Subsequent Digital’s issues have compounded in current months. Hong Kong’s monetary secretary, Paul Chan, appointed an inspector to research the corporate’s monetary affairs, a seldom-used energy beneath native regulation. The Monetary Reporting Council, Hong Kong’s auditing watchdog, opened an investigation into the corporate in August. And auditing corporations have been refusing to work with Subsequent Digital, elevating doubts about whether or not it could be capable of submit monetary statements on the finish of September as required.
With its accounts frozen, the corporate has been unable to pay excellent wages to about 700 editorial staff. Some have discovered different jobs or began new media ventures, protecting topics like on-line leisure and horse racing, however many stay unemployed. A liquidation of the corporate’s property might assist employees members obtain a few of the cash they’re owed.
The Hong Kong Journalists Affiliation has distributed money vouchers to former journalists from Subsequent Digital publications. However the journalists have been unable to obtain authorities funds designated for laid-off staff of bankrupt firms as a result of Subsequent Digital nonetheless has cash within the financial institution, though it can’t entry it.
The corporate closed the Taiwan print version of Apple Each day in Could and has been in talks to promote its remaining digital operations. Different property, together with the Taiwan operations and the corporate’s archives, would almost definitely be offered as soon as the corporate begins liquidation.