China Stock Turmoil 2015

Hong Kong shares regulator reveals plans to bolster information sharing with Beijing

PUBLISHED : Tuesday, 13 October, 2015, 8:44am
UPDATED : Tuesday, 13 October, 2015, 1:21pm

The Hong Kong regulatory authority will strengthen information sharing and cooperation with mainland China’s securities watchdog although people are raising questions about it, said Ashley Alder, Hong Kong Securities and Futures Commission (SFC) chief executive on Tuesday.

Alder’s statement came after Beijing upgraded its fight against market misconduct it has blamed for the sustained market rout since shares in China hit a 7-year top in mid-June.

Currently, officials including the assistant chairman of the China Securities Regulatory Commission Zhang Yujun, and senior executives at the country’s largest broker CITIC Securities are under investigation, allegedly for graft and inside trading.

“Both we ourselves and the CSRC are on the same boat, unless we intensify information sharing and cooperate in investigations, we would limit our ability to properly track and deal with suspected misconduct,” Alder said in a speech.

“We are progressing in discussion with the CSRC about joint supervision of the mainland headquartered financial firms, asset management brokers situated in Hong Kong,” he added, while refused to reveal if they provided information for the CSRC to broaden its investigation into the CITIC case.

Alder said to those who expressed concerns about this, his advice is to trade forward.

“The fact is the market chooses to establish closer ties with another market to offer great opportunities to investors, brokers and other participants. It is essential that regulators also establish information sharing systems arrangements,” he said, adding information sharing is subject to specific safe guards and the Hong Kong law to make sure the public’s interest, confidentiality and individual rights are safeguarded.