Regulatory Alerts2010-11-02
Added · Updated
Circular Issued by the Securities and Futures Commission Regarding Monitoring of Operational Capability
The Securities and Futures Commission issued a circular to SEHK Exchange Participants advising brokerage firms to closely monitor their operational capabilities amid rising market turnover and significant rights issue plans. Firms are required to implement contingent arrangements to handle increased business volumes and establish procedures for timely communication of material information regarding corporate actions to clients. This directive aims to ensure that brokerage firms can effectively manage client instructions and operational demands during periods of heightened market activity.
Annex SECURITIES AND FUTURES COMMISSION m!îIUtíild§~~~~t Circular 11= 8FC m~t 1 November 2010 Circular to SEHK Exchange Participants Monitoring of operational capabilty In light of an increase in market turnover and recent announcement of significant rights issue plans by some listed companies, brokerage firms are advised to closely monitor their operational capabilties and where appropriate, put in place contingent arrangement to cope with any increase in your firm's volume of business and to handle such corporate action activities. In the event of the announcement of a rights issue on a particular stock which a brokerage firm holds for their clients, the firm should put in place procedures to timely communicate material information to their clients (e.g. the terms, timetable etc. of the rights issue) and handle the clients' instructions. Should you have any queries regarding the contents of this circular, please contact Ms Madonna Yip on 28427618. Intermediaries Supervision Department Securities and Futures Commission End SFO/IS/030/2010 1 of 1 Tel: (852) 2840 9222 Fax: (852) 2523 4598 Website: ww.sfc.hk
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