The China Securities Regulatory Commission (CSRC) and the Hong Kong Securities and Futures Commission (SFC) have approved the official launch by the Shenzhen Stock Exchange, The Stock Exchange of Hong Kong Limited, China Securities Depository and Clearing Corporation Limited and Hong Kong Securities Clearing Company Limited of mutual trading access between the Shenzhen and Hong Kong stock markets (Shenzhen-Hong Kong Stock Connect). Trading will commence on 5 December 2016.
Since the issue of the 16 August 2016 joint announcement about Shenzhen-Hong Kong Stock Connect, the CSRC and the SFC have worked intensively to prepare for the launch. The necessary trading and clearing rules and other relevant rules, the daily quota mechanism and other regulatory and operational arrangements have been finalised. The stock exchanges and the clearing houses have completed a series of market rehearsals with participants in both markets and reported that systems are ready and contingency plans are in place. Market training and investor education programmes have also been conducted.
The CSRC and the SFC have agreed on the principles and arrangements for cross-boundary regulatory and enforcement cooperation relating to Shenzhen-Hong Kong Stock Connect and have signed a memorandum of understanding on regulatory and enforcement cooperation. This 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.
In addition, the CSRC and the SFC have established arrangements and procedures for cross-boundary liaison and cooperation on any contingency or major event that affects the mutual trading access and for referring and handling investors' complaints.
Also, the Mainland's Investor Protection Bureau and Hong Kong's Investor Education Centre have established an arrangement to cooperate on investor education relating to Shenzhen-Hong Kong Stock Connect. These efforts will continue after the launch.
All parties who intend to participate under Shenzhen-Hong Kong Stock Connect must familiarise themselves with applicable regulatory requirements and operational rules and ensure that proper internal controls and risk management procedures are in place. Investors should be aware of the differences between the laws, regulations, rules and market practices in Mainland China and Hong Kong and should take appropriate action to ensure compliance and to manage their risks when investing under Shenzhen-Hong Kong Stock Connect.
All parties shall be well prepared in the time leading to the launch date to ensure a smooth commencement of the Shenzhen-Hong Kong Stock Connect.
25 November 2016