Market Link Guide - Hong Kong
CSD link as defined under CSDRa
Type of link
Indirect via Citibank N.A. (Hong Kong Branch) to:
a. CSD Regulation (EU) No 909/2014, Article 2(29).
Hong Kong Securities Clearing Company Ltd (HKSCC)
Hong Kong Monetary Authority (HKMA)
Citibank, N.A. Hong Kong branch
HKMA: Not available
HKMA: Not available
Country of incorporation
Legal account name/account holder
Account holder: Citibank NA Hong-Kong
HKSCC: Securities are registered in the name of HKSCC Nominees Limited, the common nominee
HKMA: Securities are in name of the CMU member (that is, Citibank N.A. Hong Kong branch)
Citibank NA Hong Kong branch as the participant in HKSCC and HKMA holds a segregated account for CBL at either CSD.
Clearstream Banking S.A.
|Settlement free of payment||Yes|
|Settlement against payment||Yes|
Eligible settlement currencies:
|Settlement against payment in central bank money account of CBL/CBL customer|
|CBL holds a cash account at the custodian. Against payment settlement in HKD and RMB is conducted in the HKMA payment system on the cash account of Citibank Hong Kong’s acting as the clearing party.|
Not market practice but is permissible with special arrangements.
|Settlement penalty fees|
Failure of stock delivery might potentially incur buy-in penalties.
Occurs upon receipt of customers’ instructions and is subject to counterparty availability.
CCASS-eligible securities only.
Adjustment is performed based on information received from the depository.
|Multi Market Securities|
|Please refer to the Multi-securities Guide.|
|Lending and borrowing||Yes|
For all CMU instruments eligible in CBL.
CCASS-eligible funds and ETFs.
|Liquidity Hub Connect|
|Sale and purchase of rights||Yes|
|Internal Repo service for Bonds and Equities (refer to Cmax Product Guide).|
Stamp duty incurred.
|Moment of entry of instructions|
The CSD rules do not define the moment of entry within the meaning of the Settlement Finality Directive.
|Irrevocability of instructions|
Settled transactions are irrevocable.
|Finality of instructions|
Settlement in the Hong Kong market is final upon settlement in the books of HKSCC and HKMA.
The below section is based on the legal opinion obtained by CBL that was issued on 29 May 2020. The information is provided for guidance only and should not be considered in isolation or as constituting a complete or definitive legal advice on any specific matter.
No insolvency proceedings against the custodian
Custodian liability for negligence
Book-entry regime with in rem rights
Recognition of nominee concept
No right of retention to the custodian
Segregation of assets at the custodian
No right of use
No upper-tier attachments
Insolvency of the custodian with no impact on CBL's rights
Shortfall pro-rated among holders
Confirmed. Local law does not specifically address shortfall issues but a shortfall shall be borne on a pro rata basis by all the relevant account holders. Local court may however implement a different allocation approach (for example, "first in, first out" approach).
|Record keeping period of at least 10 years|
There is no general requirement under local law for Custodian to maintain records of services or activities with respect to its custody business for a period of at least 10 years. A retention period of records for a period of at least seven years was agreed with the Custodian.
Settlement finality in case of insolvency