HKEx Status Report on New Product and Market Development Initiatives
1) Possible Changes to the Requirements for Overseas Companies Seeking Listings in Hong Kong, including those seeking secondary listings
HKEx is working closely with the Securities and Futures Commission (SFC) with a view to releasing a consultation paper within a few months. The objectives are to clarify and streamline the requirements for listing overseas companies and to provide a disclosure-based approach to secondary listings of seasoned issuers from reputable overseas exchanges.
2) Consultation Paper on Review of the Code on Corporate Governance Practices and Associated Listing Rules
The consultation conclusions were published on 28 October 2011. Most Rule amendments took effect on 1 January 2012; Corporate Governance Code and certain Rules will become effective on 1 April 2012.
HKEx organised a series of 10 free seminars in November and December 2011 to provide training and practical guidance on Listing Rule amendments on corporate governance and practical issues relating to Rule compliance. One of the seminars has been recorded and posted on HKEx website as a webcast.
In January 2012, HKEx presented the same seminar in Putonghua in Hong Kong, Shanghai and Beijing. One of the Putonghua seminars has also been posted on the HKEx website as a webcast.
3) Consultation on the Placing of Shares at Initial Public Offering (IPO) and Pre-IPO Investments
At the moment, the interim guidance issued by the Listing Committee appears to be well understood and accepted by market participants. HKEx will monitor developments carefully to see if further guidance is needed.
4) Reporting on Environmental and Sustainability Issues
A consultation paper on the draft ESG Reporting Guide was published on 9 December 2011 and the deadline for replies is 9 April 2012.
5) Simplification of Prospectuses and Related Documents
HKEx published a guidance letter, GL 27-12, on the HKEx website on 12 January 2012 to give guidance on how to draft the “Summary and Highlights” section of prospectus in a way that is concise, easy to read and in plain language.
6) Study on After-hours Derivatives Trading
On 15 December 2011, HKEx published the consultation conclusions and announced its plan to introduce after-hours derivatives trading. The target for implementation is the second half of 2012.
7) Exploration of New Financial Products/Services and Review of Existing Products/Services
VHSI futures will commence trading on 20 February 2012. HKEx is rolling out educational and marketing activities for VHSI futures.
The RMB readiness test for Exchange Participants and Clearing Participants was held on 14 January 2012.
8 ) Consultation on a Scripless Securities Market
The Scripless Securities Market Working Group has completed its study of the operational details of the proposed model which will form the basis for the SFC’s consultation on the new subsidiary legislation under the SFO in 2012.
9) Derivatives Market System Capacity and Technology Upgrade
The upgrade was implemented on 12 December 2011.
10) Securities Market System Capacity and Technology Upgrades (also known as AMS/3.8 and MDS/3.8)
The upgrades were implemented on 5 December 2011.
11) Hosting Services
HKEx has been developing the operational model and service offerings of Hosting Services to prepare for service launch in 2012. Total capacity of the hosting floors inside the new HKEx Data Centre can support up to 1,200 equipment cabinets; Phase 1 of around 320 cabinets will be made available to Exchange Participants, information vendors, technology and communications providers, which will be able to interact within the ecosystem, in the fourth quarter of 2012.
12) Establishment of Clearing House for Over-the-counter (OTC) Derivatives Traded in Hong Kong
HKEx responded to the consultation on legislative amendments. System implementation has started and the risk management and operations models are being finalised. HKEx is also engaging potential Participants.
13) Next Generation Market Data System (NGMDS)
HKEx has begun developing a new market data system to consolidate the market data distribution for all HKEx’s asset classes through a single platform. The NGMDS is targeted to be rolled out in HKEx’s securities market in around mid-2013.