SFC's Policy Statement for National Security Law

It's rare for SFC to issue a press release on Sunday but it did it today by issuing a Policy Statement in relation to the new National Security Law (NSL).

This Statement was issued as a result of conversations between SFC and globally active financial institutions ("firms") operating in HK markets. These conversations have centred on concerns expressed by firms about the potential ambit and effect of the NSL on the way they currently do business in HK. SFC said it has communicated firms' observations to the HKSAR Government, and welcomes the views of the Financial Secretary as set out in his Blog today.

In this Statement, SFC expressed the following viewpoints:

• SFC is not aware of any aspect of the NSL which would affect or alter the existing ways in which firms and listed companies originate, access, disseminate and transmit financial market and related business information under the regulatory regime it administers. For example, the principles applicable to, and methodologies used by, analysts in terms of the sources of information and data they use and the manner in which their views and opinions are expressed in their reports should remain unaltered.
• Equally, the rules and accepted practices governing market trading activities, including in exchange traded and OTC derivative markets, the use of hedging strategies and activities under Hong Kong's short selling regime, also remain unaltered; all related regulations will be administered by SFC in the same manner as before the advent of the NSL.
• SFC will continue to regulate Hong Kong's markets as it has done so before the NSL was enacted and in line with this Statement.

Having read this Statement, I still cast doubt on whether it has alleviated the following concerns:

• If analysts fail to independently issue negative views on Chinese-related companies due to the NSL, would they be sanctioned by SFC?
• Could listed companies or intermediaries use the NSL as a shield to deter SFC's enforcement actions?
• Would SFC impose restrictions on short selling or use of derivatives when the Hong Kong financial markets have encountered a big crisis (like what happened during 1997-98)?
• If the US impose sanctions on persons who support the NSL (e.g. HKSAR government officials), would SFC allow or mandate licensed firms to follow suit?

I sincerely hope SFC, being led by Mr Ashley Alder, would continue to stand firm with Hong Kong's regulatory standards.

證監會為國安法維穩？

 老證好少星期日出文，但今日星期日就為咗港區國安法出咗篇政策聲明，可能想等大家聽日入市都安心啲啩。

政策聲明連結：

證券及期貨事務監察委員會的政策聲明

www.sfc.hk

老證話，同班活躍本地市場嘅國際金融機構進行對話後，收到佢地對國安法潛在適用範圍同埋對經營業務影響嘅關注。老證表示已經同香港特區政府溝通過，仲話歡迎陳茂波今日篇網誌嘅睇法。

廢話跳過，我主要引述老證呢幾點：

• 證監會謹此闡明，本會並未有察覺到《國安法》在任何層面上會影響或改變機構及上市公司現時在本會執行的監管機制下產生、存取、發放及傳達金融市場和相關商業資訊的方式。舉例來說，就分析師所使用的資料和數據的來源，以及他們在報告中發表見解及意見而言，所適用的原則及採用的方法都應維持不變。
• 同樣地，規管市場交易行為（包括在交易所買賣及場外衍生工具市場，使用對沖策略及根據香港賣空制度進行的活動）的規則及公認的做法亦會維持不變，而證監會將以與《國安法》頒布前的同一方式執行所有有關規則。
• 自《國安法》頒布以來，香港的股票及衍生品市場一直保持有秩序地運作，而香港股市的交投仍然非常活躍。在各類本地和國際投資者的參與下，以及內地投資者透過股票市場交易互聯互通機制進行交易下，7月上旬的平均每日成交額大幅上升，國際投資者經滬股通及深股通的交易更是翻倍，印證了香港作為環球資金進入中國內地資本市場的重要樞紐。

總而言之，有冇國安法都好，老證話佢嘅監管都係咁有效囉。你信唔信？我做合規呢行就有以下嘅港人問號：

1. 啲分析員評論中概股，因為擔心觸犯國安法而言不由衷(唔敢唱淡或建議沽出)，咁係咪失去中立性？老證罰唔罰佢地先？
2. 啲上市公司或中介人，用國安法做擋箭牌，唔配合老證嘅執法行動，老證可以點？
3. 如果啲外資金融機構隊冧香港個市(好似97至98年咁)，老證會唔會干預自由市場運作(例如唔畀沽空，限制使用衍生工具)？
4. 一旦美國推出制裁名單，制裁支持/執行國安法人士(包括特區政府高官)，老證會唔會容許或強制持牌公司跟美國機，拒絕向受制裁人士提供服務，甚至凍結佢地資產？(留意返，跟美國機可能觸犯國安法，唔跟又可能畀美國制裁埋，兩難。)

Ashley Alder繼續做老證CEO可能有助穩定外資信心，但監管力度係咪真係唔受國安法影響？大家拭目以待。