Joint Announcement of China Securities Regulatory Commission and Securities and Futures Commission

10 Nov 2014



The China Securities Regulatory Commission (CSRC) and the Securities and Futures Commission (SFC) have approved the official launch by the Shanghai Stock Exchange (SSE), the Stock Exchange of Hong Kong Limited (SEHK), China Securities Depository and Clearing Corporation Limited (ChinaClear) and Hong Kong Securities Clearing Company Limited (HKSCC) of the pilot programme to provide mutual trading access between the Shanghai and Hong Kong stock markets (Shanghai-Hong Kong Stock Connect). Trading through the Shanghai-Hong Kong Stock Connect will commence on 17 November 2014.

Since the issuance of our joint announcement on 10 April 2014, the CSRC and the SFC have worked closely together to prepare for the launch of the Shanghai-Hong Kong Stock Connect. The necessary trading and clearing rules and other relevant rules, the daily and aggregate quota mechanisms and other regulatory and operational arrangements have now been finalized. The stock exchanges and the clearing houses have completed a series of market rehearsals with market participants in both markets and reported that the systems are ready and contingency plans are in place. Numerous market training and investor education programmes have been conducted.

The CSRC and the SFC have agreed the principles and arrangements for cross-boundary regulatory and enforcement cooperation relating to the Shanghai-Hong Kong Stock Connect and signed the Memorandum of Understanding between the CSRC and the SFC on Strengthening Regulatory and Enforcement Cooperation under Shanghai-Hong Kong Stock Connect (滬港通項目下中國證監會與香港證監會加監管執法合作備忘錄) (Enforcement MOU). The Enforcement MOU strengthens the enforcement cooperation between the CSRC and the SFC and signifies their joint commitment to take effective action against cross-boundary illegal activities and market misconduct to maintain an orderly market and protect investors under the Shanghai-Hong Kong Stock Connect.

The CSRC and the SFC have also established arrangements and procedures for cross-boundary liaison and cooperation on any contingency or major event that affects the pilot programme and for referring and handling related investors’ complaints.

In addition, the Mainland’s Investor Protection Bureau and Hong Kong’s Investor Education Centre (IEC) have established an arrangement to cooperate on investor education relating to the Shanghai-Hong Kong Stock Connect and will continue their efforts after the launch of the pilot programme.

It is essential that all parties who intend to participate under the Stock Connect familiarize themselves with applicable regulatory requirements and operational rules and ensure that proper internal controls and risk management are in place. Investors should be aware of the differences between the laws, regulations and rules of, and market practices in, Mainland China and Hong Kong and should take appropriate action to ensure compliance and manage their risks when investing through the Shanghai-Hong Kong Stock Connect.

 



Page last updated : 10 Nov 2014