CHINA has denied that two Hongkong companies have been given approval to handle foreign exchange futures trading on the mainland.
In an unusual move, the New China News Agency quoted an official from the State Administration of Exchange Control as saying Emperor International Exchange Co and Frankwell Holdings had not been approved to engage in the business.
''Since foreign exchange futures trading is a high-risk and skill-demanding area, only financial institutions which have obtained the approval of the People's Bank of China and the State Administration of Exchange Control can engage in the business,'' said the official.
In Hongkong, both companies named by the State Administration of Exchange Control said they had not declared that they had obtained licences to operate foreign exchange futures trading business.
But a spokesman for Frankwell Holdings yesterday admitted the company was operating pilot foreign exchange trading operations in Shanghai and Guangzhou in co-operation with mainland partners.
Mr Harry Mok Chi-kwong, head of the company's information department, said the company had set up two joint ventures with the Guangzhou Radio Station and a subsidiary of the People's Bank of China Guangdong branch.
He said the two joint ventures were only given business permits by the municipal industrial and commercial administrative authorities, which did not authorise them to enter into foreign exchange trading.