Irish Funds has forged close links with HKEx as a result of the work which was done to obtain the approval of the Central Bank of Ireland for Irish domiciled funds to utilise Shanghai-Hong Kong-Stock Connect programme (“Stock Connect”).
A summary write-up by Paul Moloney from Eversheds, can be found below.
Further information can be found on Irish Funds, here.
The First of Many Hong Kong Events Planned for 2016
The event which was the first of many planned in Hong Kong for 2016, was attended by approximately 200 people and began with Pat Lardner, Chief Executive, Irish Funds, and H.E. Paul Kavanagh, Irish Ambassador to the People’s Republic of China, ringing the closing bell for the end of the day’s trading on the Stock Exchange.
Keynote Addresses – Building on Relationships and Stock Connect Since Launch
Neil Ryan, Assistant General Secretary of the Irish Department of Finance, opened the conference proper by providing an overview of the work, which the Irish Government is doing to build on the excellent relationship between Ireland, China and Hong Kong and the importance that the Irish Government attaches to this relationship.
Kevin Rideout, Managing Director, Hong Kong Exchanges and Clearing Limited then provided an overview of the developments of Stock Connect since its launch. Mr. Rideout focused on the enhancements which will be implemented in April of this year to the SPSA model to bring in DvP. Mr. Rideout also told the audience that the SPSA model was gaining approval in the market.
Panel One: Stock Connect Developments and Enhancements
The first panel discussion of the day followed Mr. Rideout’s presentation. The panel of Tae Yoo, Managing Director, Client Business Development, Hong Kong Exchanges and Clearing Limited, Shaik Ismail Hakim, Head of Securities Services, HSBC, Lisa O’Connor, MD, Securities Services, Standard Chartered Bank, Philip Tye, Chairman AIMA, Bradley Okita, Managing Director, Neuberger Berman was moderated by John Siena, Brown Brothers Harriman.
The panel had a very interesting discussion on the developments and enhancements to Stock Connect and in particular focused on the developments to the SPSA model, which are being introduced in April of this year to bring in DvP to address concerns expressed by long only managers. The panel also discussed the extension of Stock Connect to Shenzhen. Tae Yoo highlighted some very interesting trends in relation to the southbound flows under Stock Connect and the fact that these flows were being driven by the 250,000 eligible investors in China. He also highlighted the scope for growth in southbound trading in the event that the rules in relation to eligible investors in China were relaxed given that the Shanghai Stock Exchange has 40,000,000 individual accounts.
Keynote Address: Regulatory Review and Priorities of Investment Funds in 2016
Julia Leung, Executive Director, Investment Products, Securities and Futures Commission, (“SFC”) then spoke on the key projects that the SFC is focusing on in 2016. These include the implementation of the revised authorization process, introduction of the Open Ended Fund Company and updates to the Fund Manager Code of Conduct to address issues such as the payment of commissions, use of leverage and safe custody of assets.
Panel Two: Legal and Regulatory Review of Stock Connect
The second panel of Christine Wong, Head of Legal Services and Chief Counsel, Hong Kong Exchanges and Clearing Limited, Sandra Lu, Partner, Llinks Law, Shay Lydon, Partner, Matheson, Paul Moloney, Of Counsel, Eversheds was moderated by Michelle Lloyd, Head of the Irish Desk, Maples and Calder.
This panel focused on a legal and regulatory overview of Stock Connect. The discussion addressed a wide range of topics including the impact of the circuit breaker on funds utilising Stock Connect, the likely approval process with the Central Bank of Ireland when stock connect is extended to Shenzhen, the impact of UCITS V on Depositary Agreements, the likely impact of UCITS V as it relates to Stock Connect and recent developments in China relating to private fund offerings and Programme Trading.
Closing Comments and Thanks
The conference was closed with remarks from Pat Lardner, Ambassador Paul Kavanagh and Tony Riha, Head of the Irish Funds Hong Kong/China chapter.
Irish Funds would like to thank HKEx for hosting the event, the Irish Consulate in Hong Kong for all of their assistance in organising the event and all of the speakers for their participation in this very successful event.
Irish Funds would also like to extend their thanks to RR Donnelley for very kindly hosting the drinks reception which followed the event and for their continued support in Hong Kong