The Hong Kong Exchanges and Clearing (HKEx) decision in January to allow the British Virgin Islands as an acceptable overseas jurisdiction (AOJ) has been welcomed by bankers and analysts, who say the move will help attract companies to the territory for listings.
Duncan Smith, a partner at Ogier Hong Kong, a law firm which advises on overseas listings, says Hong Kong has been the only major financial centre with a restricted list.
Major financial exchanges in New York, London and Frankfurt have allowed a wide range of companies to list for some time, including those from the Virgin Islands.
'From that perspective, Hong Kong has come in line with other major financial centres,' Smith says.
He says it is a good move that will help maintain Hong Kong's superiority over Singapore as the leading capital-raising centre in Asia.
The decision will enable Virgin Islands companies to float on the HKEx. It is estimated that 65,000 companies were incorporated in the Virgin Islands last year. Inclusion on the AOJ list will expand the opportunities for Virgin Islands companies to tap Hong Kong's capital markets, that are hungry for investment opportunities.
Charles Li, who took over as chief executive of HKEx in January, has frequently said that his top priority is to attract international firms from the United States, Europe, Russia and Southeast Asia to list in Hong Kong.