Hong Kong leader Leung Chun-ying could face impeachment over ‘secret £4m payment’ from Australian engineering company

Hong Kong’s Beijing-backed leader could face impeachment over claims that he took millions of pounds in undeclared payments to serve “the needs” of a foreign firm with multiple investments in Asia.

For more than a week Leung Chun-ying, chief executive of the Chinese territory, has faced calls to quit over his handling of protests which swept Hong Kong last week and are still blocking some of its most important streets.

Today an Australian newspaper revealed that Mr Leung received £4m from an Australian engineering company, UGL, while in office as the city’s leader. Some opposition politicians have now vowed to begin impeachment proceedings against him.

In December 2011, UGL bought a property services firm, DTZ Holdings, of which Mr Leung was a director and which relied heavily on his contacts and influence. In a contract signed that month, The Melbourne Age reported that UGL agreed to pay Mr Leung to ensure key members of his Asian management team stayed at DTZ and to “provide such assistance in the promotion of the UGL Group and the DTZ group as UGL may reasonably require”. He never publicly declared the payment.

Mr Leung was said to have also agreed to not to compete with UGL and to act as “a referee and adviser from time to time,” adding that his support was on the condition it “does not create any conflict of interest”.

UGL also guaranteed he would receive the £1.5m bonus owed him by DTZ, which was insolvent. Other shareholders and unsecured creditors got nothing from the £76m sale, The Age added.

Speaking at the Admiralty protest site, Cyd Ho, a Labour Party member of the Legislative Council, joined other lawmakers in speaking of potential impeachment. According to the South China Morning Post, she said: “Apart from his duties as chief executive, Leung was also serving the needs of another company. This is a serious of conflict of interest.”

Mr Leung’s office said he had not disclosed the deal because it related to past services and was signed while he held no political office. He had resigned as a member of the city’s executive council – the chief executive’s cabinet – in October 2011 and resigned his post at DTZ in November, before signing the deal on 2 December. He took his current job in March 2012.

“The payments therefore arise from Mr Leung’s resignation from DTZ, not any future service to be provided by him,” Mr Leung’s spokesman, Michael Yu, told The Age. “Both the resignation from DTZ and conclusion of the agreement with UGL took place before Mr Leung was elected as the chief executive.”

UGL said that the agreement was not meant to elicit favours from the politician, but to make sure he did not do anything which might damage the company. They also said that the contract did not include clauses relating to Mr Leung becoming chief executive because they thought he would not win.

The claims come as Mr Leung battles protests in Hong Kong over Beijing’s proposed framework for electing his successor in 2017. Protesters, at one point numbering more than 10,000, have brought the territory’s financial and political power centre to a standstill. Tonight, numbers at the protests had dwindled to a few thousand.

The Chinese government has expressed full confidence in Mr Leung’s leadership.