Lai 'ran hotel firm funding ad campaign'

Eunice Lam

Next Digital founder Jimmy Lai Chee-ying allegedly provided instructions to his Canada-based company, Lais Hotel Properties, on hotel management, according to Royston Chow Tat-kuen.

The revelation by Chow, the former chief operating officer and chief financial officer of Next Digital, came on the 73rd day of Lai's national security trial, under cross-examination by senior counsel Robert Pang Yiu-hung, who leads Lai's legal team.

Pang said Lais Hotel Properties was owned by a trust rather than by Lai, with Chow, who is testifying for the prosecution, serving as the trust's protector.

Chow said he could not recall if the trust owned Lais Hotel but insists Lai was the one who acquired hotels and issued operational instructions.

Earlier in the trial, it was revealed that Lais Hotel had made a partial prepayment for an international propaganda campaign's publication fee in June 2019.

In recent proceedings, the defense presented group chat records from the workplace communication platform Slack involving Lai and then senior executives of Apple Daily, including then publisher Cheung Kim-hung, who had previously testified.

Pang said that the cross-examination would focus on chat records from October 2019 onward, coinciding with Chow's participation in the lunch-box meetings, to help him recall information.

Chow said that in December 2019, Apple Daily had launched an advertising scheme to support "small shops," but he could not recall the details of the meeting or when the idea was first proposed, as the conversation took place five years ago.

Pang argued that the lunch-box meetings primarily centered around Next Digital's business development and that Lai did not issue editorial instructions during these gatherings, to which Chow disagreed.

Pang presented Next Digital's annual reports from 2001 to 2021, along with a calculator. These reports showed a decline in advertisement revenue in 2019/2020 financial year, which Pang attributed to former chief executive Leung Chun-ying publicly criticizing those who advertised in Apple Daily.

Chow said he could not quantify the impact of Leung's criticism on the newspaper's ad revenue through his Facebook posts, but he agreed that around the same time, Apple Daily introduced online subscriptions.

Chow confirmed that Lai received a total of HK$1.9 billion in shareholder dividends from Next Digital between 2001 and when Apple Daily ceased its operations in 2021.

He also noted that Lai had provided shareholder loans to the group since 2019, which is uncommon for a founder to do when the company generates revenue. However, Chow believed that the loans "should not be considered evil."

The defense intends to summon Cheung back to the stand again and will question Slack chat records related to the lunch-box meetings.

The prosecution, which has called all its witnesses, said it will discuss with the defense the number of police officers to be summoned.

Expert witness Wang Guiguo, chair professor of Chinese and comparative law at City University, is expected to provide written testimony.