Hong Kong Americans Club Angers Non-US Members With Shocking HK$1.5 Million Ultimatum

“It’s about social justice. You can’t buy something and then (have things taken away)… so you’ve paid millions of dollars to use the club and all of a sudden you have to pay millions more to use it.

“We are on Hong Kong soil. Why are Hong Kongers treated differently by the club? They also contributed, paid and invested a lot of money…life is about trust.

The member was speaking after club president Christopher Burgess said in a letter to members dated May 31, a copy of which was seen by the Post, that the club was now wealthy enough to buy back its debentures from them. nominal value, estimated at several dollars. tens of thousands of dollars.

“The club is now well capitalized and, given our balance sheet and investment portfolio, the board, with the support of the membership and finance committees, has decided to repay the debt by repurchasing all debentures held individually,” Burgess said.

Non-US members must pay a fee of between HK$1.6 million and HK$2 million when purchasing a bond.

“These debentures have been traded in a secondary market since their issue and have changed hands, sometimes up to 2-3 times. With each sale, a transfer fee was also paid and was received by the club,” the letter states.

This announcement could reduce the group by 500 non-U.S. individual members who do not vote.

They will have to increase their membership to HK$1.5 million or leave the club, which has premises in Central and a country club in Tai Tam.

Members must submit their declarations of intent by August 31.

“In February 2024, the Board of Directors developed a plan to further enhance the club’s membership profile and maintain nonprofit tax status, which requires that 50 percent or more of the club’s operating revenue come from voting members,” Burgess said in the letter.

“The intention of the club is also to consolidate an important group within the membership fabric, that of non-voting members.”

The club issued debentures of various denominations as a medium-term borrowing tool to finance major development projects from 1985 to 2007.

Burgess emphasized that the new change was “a more thoughtful process that treats membership not as an asset, but as a privilege and opportunity to join the club that was built on American values ​​of culture, friendship and of community”.

The letter said those who withdrew, failed to declare their intention or failed to pay the first installment of the top-up would have their debenture redeemed at face value and their club membership would end from September 1.

The non-U.S. member added that he believed the new policy was aimed at reducing local membership and raising more money to maintain the club’s nonprofit tax status following the exodus of Americans from the city.

“I think the real intention behind this is that because the Americans are leaving, the ratio for the American Club is skewed because they have to maintain a certain ratio of over 50 percent,” the member said.

“So they try to find ways to reduce the number of local residents…and ask for more money.” »

The American Club, founded in 1925, stated in its mission statement that it was intended to be a premier venue for social, recreational and business activities for members and their families in a distinctively American atmosphere.

The club recorded a surplus of HK$1.4 million in the 2022-23 financial year, with membership income from debenture transfer and renaming fees at HK$27.1 million. Hong Kong.

Its financial reserves stood at HK$606 million as of the end of June last year.

The club’s membership stood at 2,909 – 52 percent Americans, 19 percent Hong Kongers and 10 percent British.

The Post has asked the club for comment.