Hong Kong: Introduction of Real-time delivery versus payment money settlement for the Stock Connect markets

13.11.2017

Clearstream Banking1 would like to inform customers that, effective

20 November 2017

the Hong Kong Securities Clearing Company Limited (HKSCC) will launch the Real-time Delivery versus Payment (RDP) service enhancements to the Central Clearing and System (CCASS) for settlement instructions in Stock Connect Markets – Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connect Markets.

Customers who opt for RDP settlement must indicate “YRTG” flag in field :22F::RTGS. As the flag is a settlement matching criteria, customers must check with their designated brokers to ensure they can support RDP settlement. The securities settlement will be completed only after the payment from the receiving party to the delivery party is confirmed. Customers who operate under “True DVP”2 settlement do not need to flag their instructions for RDP settlement.

Impact on customers

The RDP settlement deadlines for against payment will be earlier than the standard against payment settlement deadlines as shown below.

Central European Time (CET)

Instruction Type

Receipts against payment

Deliveries against payment

Standard (existing deadline)

10:55

09:40

RDP

08:55

08:55

Hong Kong Time (HKT)

Instruction type

Receipts against payment

Deliveries against payment

Standard (existing deadline)

17:55

16:40

RDP

15:55

15:55

Customers are required to flag their instructions for RDP settlement as per below:

Xact via SWIFT and Xact File Transfer (MT541/MT543)

  As of 20 November 2017

Field :22F:: Real Time Gross Settlement Override Indicator, sequence E

:RTGS//YRTG

CreationOnline

Processing Indicator

 Optional Settlement Period

Xact Web Portal

 

Securities RTGS

 Yes

Note: This applies for settlement on the Stock Connect CCASS platform in the Hong Kong market only and is not applicable for internal or Bridge settlement.

Further information

The Creation Link Guide – Hong Kong and related documentation will be updated in due course.

For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using the Creation platform), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.

2."True DVP" is when cash proceeds are received immediately upon settlement of an against payment transaction. Investors must use brokers who appoint Citibank Hong Kong as a Third Party Clearing or Account Operator.