Published On: Thu, Oct 8th, 2009

HK SFC Further Study Proposal To Allow Remote Participants Access Futures Market

In its consultation conclusions released today, the Securities and Futures Commission (SFC) indicated that it would further study its proposal to facilitate remote participation in Hong Kong-based futures markets (Note 1).

By the end of the consultation period on 31 March 2009, the SFC had received 16 written submissions from different market participants. The response was mixed. While some respondents supported the proposal and agreed that it would benefit Hong Kong and its markets, others disagreed, noting it would adversely affect local employment and economic conditions and result in unequal regulatory treatment between local and offshore participants.

Additionally, many respondents – including those who supported the proposal – emphasised the need to first address certain risk management issues concerning the clearing of remote participants’ trades before taking the proposal further.

In view of the concerns raised, the SFC believes that further study is needed before the proposal can be taken forward. In particular, the SFC will discuss the risk management issues further with relevant market participants and futures markets operators to seek their views on how best to address the concerns raised. The SFC will also consider if additional regulatory measures can be put in place to address further issues about regulating remote participants.

The consultation conclusions paper is posted on the SFC website (www.sfc.hk).

Article Source: HK SFC website

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