Clearing and Settlement

CCASS/3 functions available via PG will follow C3T function time schedule as specified in Section 7.2 of CCASS Terminal User Guide for Participants: https://connect.hkex.com.hk

PG Server serves as the message routing conduit between your PSS and CCASS/3 backend. Production PG Server would be located at Participants’ office premises and your operation team should make sure that the PG Server is signed on / off from CCASS/3 when necessary. In general, we suggest PG Server to perform smart card sign on/off on a weekly basis, while PSS should perform daily logon to CCASS through PG-API before submitting transactions.

There are two options to arrange the connection:

1.

Participants can access CCASS from their overseas office by extending their internal network in their Hong Kong office to their overseas office. The network connection arrangement will be transparent to HKEX and Participants may arrange by themselves.

2.

Alternatively, Participants may opt to access CCASS from their overseas office by directly connecting the network of their overseas office to the CCASS Network in Hong Kong. Feasibility of this alternative is subject to the availability of local network carrier in relevant overseas location which has service arrangement with the vendor of SDNet, the service provider of the CCASS Network in Hong Kong. Participants who opt for this alternative should provide detailed address of their overseas office to HKEX. HKEX would forward the case to the vendor of SDNet for checking and the vendor of SDNet would get back to Participants accordingly. Participants should note that they would subject to the charges levied by the overseas carrier if this alternative is elected.

In either case, Participants need to acquire their own PC which can meet the CCASS Terminal configuration requirements. 

It is not required to apply for additional user account as long as there is sufficient number of users for the Participant, the total number of users for each Participant can be viewed in “User Profile Listing” function in DMS. Participant can use “Delete User Profile” function in DMS to remove the resigned user, and use “Create User Profile” function to create user profile including assigning user ID to the new user.

For users who have registered the designated email address in their user profile is eligible to access CCASS by 2FA. To register email for users, their DAs should input the email address of the user by “Change User Profile” function in Security Management Functions (DMS); to register email for DAs, Client Connect DAs/ users with EU_UserMaintenance access right should submit eService Form – DA 3 “CCASS/ CCMS Terminal Delegated Administrator Application/ Maintenance Form” in Client Connect through HKEX Access Management Portal (https://connect.hkex.com.hk/).

For first time login, user will have to enter user ID and a OTP received from the user’s registered email, then setup user’s login password. After that, user is required to setup OTP channel (i.e. from mobile application or email) to receive OTP for subsequent login.

For subsequent login, user is required to enter (i) User ID, (ii) Password, and (iii) OTP obtained from the registered OTP channel (i.e. mobile application or email).

A unique user ID is assigned for each user and DA of a Participant, HKEX shall assign user ID for each DA of the Participant, while DAs shall assign user ID for their users.  User ID is a eight-character code, of which the first six characters are identical to the Participant ID.

With CCASS/3, when Participants execute CCASS transactions, they can identify themselves by specifying (1) their Participant ID; or (2) their BIC as an alternative.  BIC will be applied in two situations in general:

1.	The data field “Sender BIC” in the file header of all upload files serves as an alternative to the “Participant ID” data field.
2.	The data field “Counterparty BIC” in the detailed record of SI/ISI (both on-line screen and upload file) serves as an alternative to the “Counterparty ID” data field.

CCASS/3 Terminal (C3T) utilizes an Edge browser to connect to CCASS/3. The PG Server, provided by HKEX, is deployed to the Participant site and is responsible for connecting to CCASS/3. However the Participants must procure the necessary hardware, software, communication interface, and security device to access CCASS/3 via PG.  Participants need to develop a Participant Supplied System (PSS) and the interface between their PG/PSS and CCASS/3 based on the Application Program Interface (API) protocol and message standard provided by HKEX.  Participants are also required to perform interface test with HKEX to certify their PG access.

For connectivity of PG to CCASS/3, for development environment, PG Participant is required to subscribe a development SDNet link for testing purpose in initial commissioning and for subsequent maintenance; for production environment, Participants can either choose to share C3T link or subscribe a separate link for PG, depending on the projected transaction volume.

Participants who want to install PG would need to bear the one-time set up cost and recurrent cost.  One-time set up costs include the purchase of hardware and software, commissioning, smartcard, and PSS development.  Recurrent costs include PG maintenance fee, monthly  fee of SDNet development link, and the potential maintenance costs relating to the upgrade of PSS and testing on the PG interface due to modifications in business operations or CCASS/3 functions.

The current fee schedule for PG is set out in CCASS Participant Gateway – Fee which is available in Client Connect (https://connect.hkex.com.hk/)

a)   How is the access to PG controlled?

PSS must be successfully authenticated by PG Server in order to gain the access. Authentication against User ID, password (MD5 hashed) and IP address is done during PSS logon to PG. The PG connects to CCASS/3 using a smartcard and password. Participant must type in the password and perform a logon on before the PSS can login to the PG Server.

b)   What is the message protocol to be used to connect with PG? How security issues or concerns may be dealt with?

The PG communicates with CCASS/3 via HTTP protocol over SSL and the PSS communicates to the PG Server using socket over TCP/IP (using the PG-API provided by HKEX). Participants can choose either secured connection (SSL) or normal connection for the connections between PG and PSS.

The PG connects to CCASS/3 using a smartcard and password. Participant must type in the password and perform a logon before the PSS can login to the PG Server.  The PG follows the same security level as C3T.

c)   Do we need to have SSL certificate key exchange? Could HKEX clarify on SSL portion?

A smartcard issued by HKEX is required to operate PG. Upon user successfully logon PG with the smartcard, SSL session will be established between PG and CCASS/3. This part is done by PG.

d)   How is communication between Participants and HKEX conducted via PG?

It is conducted on a request-response basis, i.e. PSS needs to submit a request (input message), and then CCASS/3 response to the request (output message) accordingly. It follows that if a Participant wants to change or cancel an instruction already accepted by CCASS/3, it needs to first send an input message for enquiry of the time stamp of the instruction by specifying the instruction number. CCASS/3 will respond by locating the instruction based on the instruction number specified and return the details of the instruction, including the time stamp via output message. Participant need to send another input message again to make changes/cancel the instruction.

Yes, this may be required but not a usual practice. Normally it would be HKEX to login remotely for the following purposes:

-     obtain system logs for problem diagnosis

-     PG software or third party software upgrade

-     virus definition update

For the initial deployment, they are bundled with the delivery of the PG Server to the Participant. For subsequent software maintenance, they may be done remotely by HKEX/third party vendor, or done at Participant’s site, depending on the complexity of the maintenance.

For the frequency of the maintenance, it will depend on the software life cycle of the third party software.

For virus definition update, it will be performed remotely by HKEX monthly, without Participant intervention. 

For PG software release, it depends on whether there is any urgent enhancement on PG Server and whether the business enhancement in CCASS/3 will impact PG. The later one will be at most 2 to 3 times a year.

Participants can choose a single PG or dual PG configuration. The network bandwidth requirement depends on the data volume of the online messages, file upload and report data file download. Participants can calculate their required bandwidth according to their message volume and the message lengths as specified in the PSS Messaging Specifications.

The minimum bandwidth for a single PG or dual PG configuration is 128K or 256K respectively.

There are two possibilities:

i.    PG Server is closed. Your PSS application should not be able to logon PG in this case.

ii.   Problems encountered on the network connection between PG and CCASS/3.

For technical enquiries, please contact CCASS Technical Hotline at 2211- 6606. For general enquiries, please contact CCASS Hotline at 2979-7111.

No, multiple PG instances cannot be run on the same PG machine. For SDNet line it can be shared by multiple PGs if the bandwidth subscribed can support the estimated transaction volume. Participants may also consider subscribing two PGs for resilience purpose and at the same time configure them to be active-active to increase the overall throughput.

a)   Must PG (PC/Server) be in the same LAN as the PSS Server? Any specific socket must be granted access?

      PG Server supports TCP/IP which can be located in different LAN segment as the PSS Server. Make sure the normal and secure port is available if there is any firewall in between.

      HKEX has assigned the following port numbers between PSS and PG:

•     Secure connection: 4433 for synchronous and 4434 for asynchronous transactions.

•     Normal connection: 8080 for synchronous and 8081 for asynchronous transactions.

b)   Can we assume that any communication between PSS and PG are securely handled by PG-API call? Does this include the encryption of password into MD5 Hashed (encryption algorithm)?

      Secured connection (SSL) can be setup between PSS and PG, with which communication between PSS and PG is secured. Password will be encrypted using MD5.

For PG logon to CCASS/3, the initiation is from PG Server to CCASS/3. For broadcast message polling, PSS should be the initiating party to subscribe to asynchronous and broadcast messages. Then PG Server will poll CCASS/3 for asynchronous and broadcast message, when there are messages, PG will callback PSS.

For subsequent transactions, the initiation should be PSS. PSS sends request messages to PG via PG-API, and then PG-CCASS/3 will reply message to PSS when the PG-API returns.

Yes. HKEX will provide necessary technical information for the Participants (or software house) to design and develop PSS based on their requirements.

Yes. Certification to PSS is required at Participant level. HKEX will also certify PSS in the perspective of CCASS/3 communication.

There are several testing requirements before the Participants admit for PG:

•  Readiness of PSS:        It is assumed that Participants already completed the relevant unit tests on the PSS.

•  PG Simulator Test:       HKEX will provide a PG simulator (a program) for Participants to test their PSS.

•  PG End to End Test:    The test will be conducted with PG connection to CCASS/3 testing environment. Participants will need to prepare a Windows-based PC as the PG Server (with software provided by HKEX), and a testing C3T for the result verification.

•  PG Connectivity Test:  The test is to ensure the production connectivity between PG and CCASS/3 upon PG deployment at the Participant site.

 The testing arrangements and schedule needs to be confirmed between HKEX and the Participant.

A Settlement Agent is a service provider appointed by a CCASS Participant except Investor Participant (“non-IP Participant”) to access CCASS and conduct settlement and other activities in CCASS on behalf of the Participant without changing the Participant’s principal obligations vis-à-vis HKSCC. The TPC model offers an added option for Exchange Participant who trades on the Stock Exchange of Hong Kong (SEHK) to outsource its clearing functions to General Clearing Participant(s) who provides clearing services to Exchange Participants. Under TPC, an Exchange Participant has NO clearing participantship in CCASS and is referenced as a Non-Clearing Participant (NCP).  An Exchange Participant which is an (i) NCP or (ii) a Clearing Participant which is not a China Connect Clearing Participant and which has entered into a Clearing Agreement with a General Clearing Participant for the clearing of its China Connect Securities Trades is referenced as a Non-China Connect Clearing Participant (NCCCP).

A table summarizing the key features of the SA and TPC models is shown below:

Descriptions	SA	TPC
1. Key concept	Allow Exchange Participant to outsource its CCASS operations (administrative functions only) to a Settlement Agent.	Allow Exchange Participant to outsource its CCASS clearing and settlement obligations to designated GCP(s).
2. Role of the service provider	SA is a CCASS account operator who conducts settlement and other activities in CCASS on behalf of the Participant.	GCP takes up the Exchange Trades and/or China Connect Securities Trades executed by its NCP/ NCCCPs and conduct clearing and settlement with HKSCC as principal in GCP’s own CCASS account.
3. Status of the service provider	SA does not need to be a CCASS Participant itself. However, it needs to demonstrate that it has adequate clearing experience and capability.	GCP is a CCASS Clearing Participant who needs to be formally admitted by HKSCC before clearing trades for other Exchange Participants.  GCP must be a China Connect Clearing Participant in order to provide clearing and settlement services in respect of China Connect Securities Trades to NCP/ NCCCPs.
4. Participantship	Exchange Participant must be a DCP. SA is not itself a type of CCASS Participant.	For the case of an NCP, the Exchange Participant does not need to be a Clearing Participant. An Exchange Participant who is a Clearing Participant can choose to become an NCCCP and appoint a GCP for clearing of its China Connect Securities Trades. GCP does not need to become an Exchange Participant.

For more details on TPC, please visit the TPC section:http://www.hkex.com.hk/Services/Clearing/Securities/Getting-Started/Third-Party-Clearing-by-HKSCC-General-Clearing-Participants?sc_lang=en.

A Settlement Agent may be a non CCASS Participant as long as all the conditions and requirements in relation to appointing a Settlement Agent are met. When considering such application, the Settlement Agent would be assessed as if it were applying to become a CCASS Participant.

In general, CCASS can be operated from a foreign jurisdiction, for more details, please refer to CCASS/3 – Frequently Asked Questions at http://www.hkex.com.hk/Global/Exchange/FAQ/Securities-Market/Clearing-and-Settlement/CCASS-3?sc_lang=en.

A non-IP Participant may, subject to HKSCC’s approval, appoint a Settlement Agent who is located in a foreign jurisdiction.  Pursuant to CCASS Rule 3904, the non-IP Participant needs to provide a legal opinion confirming that such arrangement will not:

a.            subject HKSCC, the Exchange or a recognized exchange controller to any legal, regulatory, reporting, registration or other requirements of the foreign jurisdiction;

b.            deem HKSCC, the Exchange or a recognized exchange controller to be carrying on any business in that jurisdiction;

c.            have any tax implications on HKSCC , the Exchange or a recognized exchange controller; and

d.            affect the right of inspection by HKSCC to books, records or systems relating to CCASS or  transactions conducted through CCASS in that jurisdiction.

The legal opinion shall be issued in such form as set out in Rule 3904 of the General Rules of CCASS. The non-IP Participant shall ensure that it complies with all applicable laws, regulations and requirements of the jurisdiction where its and its Settlement Agent’s CCASS Terminals, office premises or operations are located.

If a non-IP Participant is regulated under the Securities and Futures Ordinance “SFO”, then it should notify the Securities and Futures Commission (“SFC”) of its plan to outsource its operations to a Settlement Agent prior to applying to HKSCC.  HKSCC will liaise with the SFC on receipt of an application from a non-IP Participant and obtain SFC’s consent on the outsourcing arrangement before approving the application.

In addition, non-IP Participants should notify HKSCC of any change of particulars arising from the appointment of Settlement Agent according to the existing procedures. 

The Participant, which is a licensed corporation or registered institution, must ensure that it will continue to comply with all the requirements as set out in the SFO including but not limited to:

·     Client Securities Rules

·     Client Money Rules

·     Contract Notes, Statements of Account and Receipts Rules

·     Keeping of Records Rules

·     Accounts and Audit Rules

The Participant should also ensure additional insurance would be taken up to cover the additional risks arisen as a result of the outsourcing arrangement.

The Participant and the Settlement Agent may be required to issue an undertaking to the SFC covering the above.  Applicants are advised to contact the SFC direct to determine the SFC’s requirements on the undertaking. 

When assessing the Settlement Agent application, HKSCC would consider key aspects such as:

·     Whether the proposed SA is an existing CCASS participant and if it has a good track record;

·     Whether the proposed SA has specified a designated person with adequate qualification to be responsible for ensuring compliance with the CCASS Rules & OP;

·     Whether the proposed SA has an adequate operational risk control plan in place. 

Yes. The appointment of C3T Delegated Administrators (at least one maker and one checker to maintain user profiles of its end users) and end users (to perform various CCASS functions via C3T) should be authorized by the non-IP Participant.

Non-IP Participants can use their Delegated Administrator and end user’s account to access CCASS Terminal installed overseas by 2FA. Delegated Administrators can create, change, and delete user profile of end users. 

However, Participant should notify HKEX for user profile maintenance of Delegated Administrators by submitting the eService – DA 3 “CCASS/ CCMS Delegated Administrator Application/ Maintenance Form” in Client Connect through HKEX Access Management Portal (https://connect.hkex.com.hk/).

There are two options to arrange the connection:

1.

Participants can access CCASS/3 from their overseas office by extending their internal network in their Hong Kong office to their overseas office. The network connection arrangement will be transparent to HKEX and Participants may arrange by themselves.

2.

Alternatively, Participants may opt to access CCASS/3 from their overseas office by directly connecting the network of their overseas office to the CCASS/3 Network in Hong Kong. Feasibility of this alternative is subject to the availability of local network carrier in relevant overseas location which has service arrangement with the vendor of SDNet, the service provider of the CCASS/3 Network in Hong Kong. Participants who opt for this alternative should provide detailed address of their overseas office to HKEX. HKEX would forward the case to the vendor of SDNet for checking and the vendor of SDNet would get back to Participants accordingly. Participants should note that they would subject to the charges levied by the overseas carrier if this alternative is elected.

In either case, Participants need to acquire their own PC which can meet the C3T configuration requirements.  Participants can acquire smartcard readers and smartcards from HKEX for their C3T and operation staff in overseas office.  Participants should note that HKEX would not provide any on-site support for the C3T installed in their overseas offices and Participants would need to perform C3T commissioning themselves.

With CCASS/3, when Participants execute CCASS transactions, they can identify themselves by specifying (1) their Participant ID; or (2) their BIC as an alternative.  BIC will be applied in two situations in general:

1.	The data field “Sender BIC” in the file header of all upload files serves as an alternative to the “Participant ID” data field.
2.	The data field “Counterparty BIC” in the detailed record of SI/ISI (both on-line screen and upload file) serves as an alternative to the “Counterparty ID” data field.

The launch date of TPC was 3^rd December 2007 and a high level description of the key features of the TPC model can be found in the Explanatory Document located at HKEX web:

http://www.hkex.com.hk/-/media/HKEX-Market/Services/Clearing/Securities/Overview/Third-Party-Clearing/TPC_EN.pdf?la=en.

A table summarizing the key features of the SA and TPC models is shown below:

Before appointing a GCP, an Exchange Participant should understand the various implications arising from outsourcing its CCASS clearing and settlement obligations to a third party. The key implications, including control and monitoring of its outsourced responsibilities, operational and systemic risks and the associated insurance coverage, as well as the standard, scope and service level offered, should be considered and properly addressed beforehand. Exchange Participant can refer to the "Principles on Outsourcing of Financial Services for Market Intermediaries" issued by the International Organization of Securities Commissions "IOSCO" which can be downloaded from IOSCO's website at www.iosco.org

(link: http://www.iosco.org/library/pubdocs/pdf/IOSCOPD187.pdf ). 

HKSCC has no specific requirement on the client arrangement between various parties under TPC. In general, two TPC models are widely adopted in the overseas markets namely: Omnibus Model and Fully Disclosed Model.

Under the Omnibus Model, clients of the NCP/ NCCCP may open accounts with the NCP/ NCCCP only. The NCP/ NCCCP in turn maintains an “omnibus” account with its GCP and retains full responsibility in relation to client services including the handling of client settlement and other nominees services. The NCP/ NCCCP’s clients only have contractual relationship with the NCP/ NCCCP, not the GCP.

Under the Fully Disclosed Model, the NCP/ NCCCP discloses relevant client information to the GCP who maintains an account for each of the NCP/ NCCCP’s client and serves them directly. The GCP carries these individual client accounts in its own books. In this case, NCP/ NCCCP’s client may also need to have direct contractual relationship with the GCP.

NCP/ NCCCP and GCP should determine the most appropriate model (or mix of the models) based on their business requirements and ensure NCP/ NCCCP’s clients are well informed of their arrangement with appropriate client agreement in place with NCP/ NCCCP and/or GCP.

Not directly. Through its GCP, NCP/ NCCCP can make use of the SSA service provided by HKSCC to receive independent information on securities holdings in CCASS for each SSA holders. A NCP/ NCCCP can request its GCP to set-up SSA in the GCP’s CCASS account specifically for the use of the NCP/ NCCCP and/or its clients. For detailed information, please refer to

http://www.hkex.com.hk/Services/Settlement-and-Depository/Stock-Segregated-Account-with-Statement-Services?sc_lang=en.

Except for China Connect Securities which are uncertificated securities and hence physical deposit and withdrawal of which into/from the CCASS Depository are not available, GCP, as a CCASS Clearing Participant shall process certificate deposit and withdrawal transactions on behalf of its NCP clients. Furthermore, representatives of NCPs can be authorized by the GCP to deposit and collect share certificates directly from CCASS Depository. 

Likewise, GCPs provides nominee services to their NCP/ NCCCPs (including clients of the NCP/ NCCCPs depending on the client arrangement between GCP, NCP/ NCCCP and its clients).

Yes, NCP can continue to provide IPO services to its clients using CCASS EIPO and yellow application forms. 

When using CCASS EIPO, NCP may provide the application details of its clients to its GCP, who then submits all those EIPO applications via the CCASS terminal.  NCP may also request GCP to input its broker number in the relevant EIPO applications for the NCP to receive IPO brokerage commission.  Further, NCP should also agree with GCP on the arrangement for depositing the relevant application monies into GCP’s CCASS designated bank account.  On the allotment results announcement date, GCP will, based on the EIPO allotment information as contained in the New Issue Entitlement Report, notify NCP of the allotment results of its clients’ applications.

When using yellow application forms, NCP may fill in the forms as a nominee by providing the beneficial owner’s identification code or account reference for identification purpose.  NCP may then submit the completed form stamped with its broker chop together with a cheque to its GCP, who in turn fills in its CCASS Participant’s I.D., and stamp its company chop with authorized signature(s) in the appropriate box in the form.  On the allotment results announcement date, GCP will, based on the yellow form allotment report available from the CCASS Terminal, notify NCP of its clients’ applications.

Yes, an existing CCASS DCP or Custodian Participant must terminate its existing CCASS Participantship and re-apply to become a GCP.

For operational efficiency, existing DCPs or Custodians who have been admitted as GCP do not need to change their existing CCASS accounts and Participant ID numbers. HKSCC will update the participant status internally granting it all GCP’s related CCASS functions from the admission date. 

EPs/CPs/CMs/IVs are required to take note of the new service arrangement and the effective date of the renewal of service contract between HKEX and Accredited Vendors.

When a new contract has to be signed with Accredited Vendor after the expiry of the existing contract, the price and terms depend on when it is signed. 

Contract signing data	Terms and conditions
Before 1 March 2016	will follow the existing contracts between HKEX and Accredited Vendors
On or after 1 March 2016	will follow the new service contracts between HKEX and Accredited Vendors

EPs/CPs/CMs/IVs are advised to contact their selected Accredited Vendors and consider the commercial offers and services provided by individual Accredited Vendor. EPs/CPs/CMs/IVs are advised to select Accredited Vendors according to their own business needs.

The prices of SDNet/2 monthly tariff and related services are either capped or to be negotiated between EPs/CPs/CMs/IVs and the Accredited Vendors.  EPs/CPs/CMs/IVs are advised to contact their selected Accredited Vendors and consider the commercial offers and services provided by individual Accredited Vendor.  EPs/CPs/CMs/IVs are advised to select Accredited Vendors according to their own business needs.

http://www.hkex.com.hk/eng/market/sec_tradinfra/sdnet2.htm  or

http://www.hkex.com.hk/eng/market/dv_tradinfra/sdnet2.htm  or

http://www.hkex.com.hk/eng/market/clr/secclr/sdnet2.htm  or

http://www.hkex.com.hk/eng/prod/dataprod/omd/Documents/SDNet2_Accredited%20Vendor%20Contact%20Information%20V1.pdf

EPs/CPs/CMs/ IVs are advised to contact the Accredited Vendors directly for the prices of SDNet/2 circuit and related services.

Currently, there are some situations where the Accredited Vendors are not allowed to install fibre cables (e.g. inside premises of data centre service providers or buildings whose building & management offices who sell their own fibre cables). EPs/CPs/CMs/IVs may need to bear the extra services cost charged by third parties. In such cases, EPs/CPs/CMs/IVs are advised to check with the Accredited Vendors because the degrees of installed fibre at each building by different Accredited Vendors may vary. 

Due to the fact that the installation environment varies in different sites, the selected Accredited Vendor will carry out site visit to the offices of EPs/CPs/CMs/IVs and will discuss with the EPs/CPs/CMs/IVs on the facilities required for the circuit installation. Therefore, Ps/CPs/CMs/IVs should check with the Accredited Vendors if there is any extra cost required for the circuit installation according to actual situation.

The minimum subscription period of SDNet/2 circuits is 3 months and 1 month advance notice for termination without any cause given by the EPs/CPs/CMs/IVs.

Yes. EPs/CPs/CMs/IVs who have more than one set of SDNet/2 circuits are allowed to select more than one Accredited Vendor. However, EPs/CPs/CMs/IVs must subscribe from the same Accredited Vendor for both individual circuits within a dual-circuit configuration.

All Accredited Vendors must provide SDNet/2 service according to the predefined technical requirements from HKEX. Technically, SDNet/2 circuits provided by all Accredited Vendors are fully compatible with the market systems of HKEX.

EPs/CPs/CMs/IVs are advised to contact their selected Accredited Vendors and consider the commercial offers and services provided by individual Accredited Vendor. EPs/CPs/CMs/IVs are advised to select Accredited Vendors according to their own business needs. Before selection, EPs/CPs/CMs/IVs are advised to study carefully the terms and conditions offered by the individual Accredited Vendor

There is no change in the on-going support and services due to the SDNet/2 service contract renewal between HKEX and Accredited Vendors.

For network problem, EPs/CPs/CMs/IVs should report the fault to their
Accredited Vendors directly.

Accredited Vendors will be responsible for monitoring the healthiness of the circuits of EPs/CPs/CMs/IVs. EPs/CPs/CMs/IVs are advised to check with their selected Accredited Vendors if notification service will be provided when the Accredited Vendors' networks encounter interruption.

EPs/CPs/CMs/IVs are required to inform the Exchanges/Clearing Houses for change of SDNet circuit bandwidth or Accredited Vendors.

EPs/CPs/CMs/IVs should liaise with the Accredited Vendors to perform the bandwidth upgrading/downgrading after the daily operation has been completed.

EPs/CPs/CMs/IVs can click the below link
http://www.hkex.com.hk/eng/market/sec_tradinfra/Documents/SDNet2_Accredited Vendor Contact Information.pdf for Accredited Vendors’ contacts.

ASP (”Application Service Provider”) is the service provider providing shared SDNet/2 circuit services connectivity to multiple EPs/CPs/CMs/IVs. Under the ASP connection service, ASP will subscribe the SDNet/2 circuits from the Accredited Vendor(s) and manage the network connectivity on behalf of the EPs/CPs/CMs/IVs.

ASPs should contact the Accredited Vendor regarding the application of ASP connections and HKEX-IS on the data licensing requirement.

EPs/CPs/CMs/IVs should contact their respective software/system providers regarding the ASP connection services.

Yes, you should have software to view pdf document. You need to have the following software installed to read these documents:

- Acrobat reader 6.01 or above. You can download at http://www.adobe.com

- To read Chinese pdf document, please download Asian Font Pack (Traditional Chinese) at http://www.adobe.com

Security is the most important consideration when we introduce the Internet services. We have the following security measures to protect our customers:

- CCASS Internet System supports Internet User ID & Internet User Password. Our system used Secured Socket Layer (SSL) and protected by 128-bit encryption, the highest level of encryption commercially available. All the data sent to and from HKSCC is encrypted to protect your personal / company and financial information.

- User ID and password must be entered to authenticate your identity every time you logon to CCASS Internet System. Your password will be temporarily suspended if you incorrectly key in your password for three consecutive times.

- If the machine is left idle for more than 15 minutes, the system will logoff automatically to prevent unauthorized access.

Followings are some tips:

- Make sure the web site is using SSL technology for data transmission.

- Click the 'lock' icon at the bottom of your browser to check the server digital certificate. This can assure that you are visiting the right web site.

- Once you have created an Internet User ID and Internet User Password, do not disclose the password to anyone and do not write down or record the password without disguising it.

- There is an 'auto complete' function available for Internet Explorer user, which may save your web password entries in browser. It means a potential leakage of your passwords to unauthorized parties. So, it is recommended to disable this feature: 
1.   In the 'Tools' from the menu bar, choose 'Internet Options'. 
2.   Click the 'AutoComplete...' button. 
3.   Uncheck the 'User names and passwords on forms' checkbox.
4.   If necessary, click the 'Clear Forms' and 'Clear Passwords' to clear all previously saved entries.

- It is risky to conduct transaction using a PC at public area. It is because the PC may contain hacking program that can capture your personal information.

Currently, there are 19 types of stock movements in CCASS applicable to SSA with Statement Service as listed below:

i.	AT	-- Mass STI
ii.	CC	-- consolidation
iii.	CH	-- shareholding removal
iv.	CR	-- stock code conversion
v.	CS	-- splitting
vi.	RD	-- redemption
vii.	SN	-- continuous net settlement (CNS) position settlement
viii.	SO	-- investor settlement instruction (ISI) without affirmation position settlement
ix.	SP	-- investor settlement instruction (ISI) with affirmation position settlement
x.	SS	-- settlement instruction (SI) position settlement
xi.	ST	-- isolated trade settlement
xii.	SU	-- investor settlement instruction (ISI) position unwind
xiii.	TO	-- stock segregated account transfer instruction (STI) without affirmation
xiv.	TW	-- stock segregated account transfer instruction (STI) with affirmation
xv.	WD	-- counter deposit
xvi.	WJ	-- counter adjustment
xvii.	WT	-- inter-depository transfer instructions
xviii.	WU	-- underlying stock settlement of ETF
xix.	WW	-- counter withdrawal

SSA Statement Recipients can enquire the stock movement activities performed within the last 31 calendar days via CCASS Internet System.

Yes.  An SSA Statement Recipient can enquire either the balance of a specific stock or all available stocks.

The share transfer between a SSA with Statement Service and another stock account (including SSA with Statement Service) of the same broker or custodian which is a CCASS Participant is facilitated by Stock Segregated Account Transfer Instruction (STI).

The STI must be input by a broker or a custodian which is a CCASS Participant via CCASS.  There are two types of STI, namely: STI (with Affirmation) and STI (without Affirmation).

An SSA Designated Bank Account in the name of SSA Statement Recipient must be setup in CCASS in advance by his/her broker or custodian which is a CCASS Participant if the SSA Statement Recipient wishes to receive the fund via STI on Delivery versus Payment (DVP) basis.  The SSA Designated Bank Account must be maintained with one of the designated banks approved by HKSCC.

For a SSA with Statement Service with the ‘Affirmation Requirement’ is selected in CCASS, the input of STI in respect of such SSA with Statement Service as the stock delivering party will be an STI (with Affirmation); for a SSA with Statement Service with the ‘Affirmation Requirement’ is NOT selected in CCASS, the input of STI in respect of such SSA with Statement Service will be STI (without Affirmation).

Shares of STI (with Affirmation) will only be transferred after the SSA Statement Recipient affirmed it via CCASS Phone System or CCASS Internet System, whereas shares of STI (without Affirmation) will be transferred after input by a broker or a custodian which is a CCASS Participant without the affirmation by the SSA Statement Recipient.

Under the following conditions, the input of STI will become STI (without Affirmation) even the ‘Affirmation Requirement’ of an SSA with Statement Service is selected: 
a.   The SSA with Statement Service is the stock receiving account; and
b.   The payment instruction is Free of Payment (FOP)

The ‘Affirmation Requirement’ is setup for a SSA with Statement Service at the request of the SSA Statement Recipient and such SSA with Statement Service is the stock delivering party of the STI.

No, both STI (With Affirmation) and STI (Without Affirmation) can only be input by your broker or custodian which is a CCASS Participant of the SSA with Statement Service.

No.  An SSA Statement Recipient can’t revoke an STI.  Your broker or custodian which is a CCASS Participant will be allowed to revoke an STI either in “Unaffirmed” or “Pending for Transfer” status where necessary.  All revoked STI can no longer be enquired.

DVP is only applicable to an STI of which the stock delivering party (‘From Account’) is an SSA with Statement Service.

If the stock transfer of an STI will be effected on a DVP basis, after the shares of STI is transferred, funds will be credited to the designated bank account of the SSA with Statement Service through the CCASS overnight banking process on the transfer day.  As payment instruction is generated after the shares are transferred out from the SSA with Statement Service, you are reminded to assess and monitor the credit risk involved.

The STI (With Affirmation) must be affirmed within 10 calendar days from the input date of the STI; otherwise, the unaffirmed STI will be purged by the system.

In general, after your broker / custodian which is a CCASS Participant input a STI (With Affirmation), an SSA Statement Recipient can affirm the STI on a 24-hour basis, except during the system maintenance period, i.e. 05:00-06:00 from Monday to Saturday (including public holiday) and 00:00-7:00 on Sunday.

For the STI (With Affirmation) to be effected on a DVP basis, if the STI is affirmed after 15:45 on any business day (Monday to Friday), the affirmed STI will only be captured and pending for subsequent processing.  The STI will only be processed on the next settlement day around 07:00 and the share transfer will be executed during STI batch-run.

For the STI (With Affirmation) to be effected on a FOP basis, if the STI is affirmed after 19:00 on any business day (Monday to Friday), the affirmed STI will be captured and pending for subsequent processing.  The STI will only be processed on the next settlement day around 07:00 and the share transfer will be executed during STI batch-run.

The STI activities within the past 31 calendar days can be enquired via CCASS Internet System.

An SSA Statement Recipient can select to input voting instruction himself/herself, or continue to appoint his/her broker or custodian which is a CCASS Participant to perform voting on his/her behalf.  If an SSA Statement Recipient would like to perform voting by himself/herself, he/she has to inform his/her broker / custodian which is a CCASS Participant to make necessary setup in CCASS.

The voting instruction can be enquired via the CCASS Internet System up to 31 calendar days after the date of the meeting.

An SSA Statement Recipient should notify his/her broker or custodian which is a CCASS Participant if he/she wishes to subscribe the service.  His/her broker or custodian as a CCASS Participant will then register the service for him/her.  For SMS, an SSA Statement Recipient also has to register the service with his/her mobile carrier.

HKSCC provides several SMS and Email alerts to SSA with Statement Service, including:

i.      Stock movements (both debit and credit movement) in CCASS
ii.     STI Reminder (To Be Affirmed STI, Transferred STI and Rejected STI)
iii.     Voting Notification
iv.     Issuer Announcement (via Email only)

The following type of stock movement transactions are covered in the SMS and Email alert:

i.	AT	-- Mass STI
ii.	CH	-- shareholding removal
iii.	SN	-- continuous net settlement (CNS) position settlement
iv.	SO	-- investor settlement instruction (ISI) without affirmation position settlement
v.	SP	-- investor settlement instruction (ISI) with affirmation position settlement
vi.	SS	-- settlement instruction (SI) position settlement
vii.	ST	-- isolated trade settlement
viii.	SU	-- investor settlement instruction (ISI) position unwind
ix.	TO	-- stock segregated account transfer instruction (STI) without affirmation
x.	TW	-- stock segregated account transfer instruction (STI) with affirmation
xi.	WD	-- counter deposit
xii.	WJ	-- counter adjustment
xiii.	WT	-- inter-depository transfer instructions
xiv.	WU	-- underlying stock settlement of ETF
xv.	WW	-- counter withdrawal

Yes.  An SSA Statement Recipient can subscribe either SMS or Email alert or both alerts.  An SSA Statement Recipient can subscribe different types of alerts to be received via SMS or Email.

Yes.  An SSA Statement Recipient can subscribe any of the following SMS and/or Email alert:

i.      Debit stock movement;
ii.     Credit stock movement;
iii.    STI reminder (including To be Affirmed STI, Transferred STI and Rejected STI);
iv.     Voting notification;
v.      Issuer Announcement (via Email only); 
vi.     All available options

Yes.  An SSA Statement Recipient can select to receive SMS and/or Email alert in English, Traditional Chinese or Simplified Chinese.  The availability of the language to be used for SMS will be subject to the mobile carrier of the SSA Statement Recipient.  Only one language can be selected for both SMS and Email.

The schedule of SMS and Email alert is as follows:

Alert Transaction	Day	Time
Stock Movement Transactions - Debit	Monday - Friday	09:30 - 20:30(run every 15 mins)
Stock Movement Transactions - Credit	Monday - Friday	09:30 - 20:30(run every 15 mins)
Stock Segregated Account Transfer Instruction (STI)	Monday - Friday	09:30 - 19:00(run every 15 mins)
Voting Notification	Monday – Saturday	After 19:00 for Monday to Friday After13:00 for Saturday
Issuer Announcement	Monday – Friday	At around 08:15,09:45,13:45,17:15,18:45,20:00 and 22:00

SMS and Email messages are issued in one-way transmission mode and you should not reply to them after receipt.

An SSA Statement Recipient should update his/her broker or custodian which is a CCASS Participant about the updated SMS phone number and/or mobile carrier immediately.  Subject to the service availability of different mobile carriers, an SSA Statement Recipient should also subscribe the SMS service with his/her new mobile carrier in order to successfully receive the SMS messages.

An SSA Statement Recipient should notify his/her broker or custodian which is a CCASS Participant the updated email information immediately so that his/her broker or custodian as a CCASS Participant could update the profile of the SSA with Statement Service accordingly.

Yes.  An SSA Statement Recipient can update their SMS and Email subscription details or terminate the alert service via his/her broker or custodian which is a CCASS Participant.  Once the SMS and/or Email subscription is being terminated, you no longer will receive SMS and/or Email alert messages.

An SSA Statement Recipient should also subscribe the SMS service from his/her mobile carrier.  Currently, the SMS alert service are only supported by 1010, One2Free, 3 Dualband and Peoples.

The Email account might reach the preset capacity limit.  An SSA Statement Recipient should perform regular clean up of their mail boxes in order to receive Email alerts from HKSCC.

An SSA Statement Recipient can reset his/her Internet User Password via the 'Forget Password' function with a valid CCASS Phone Password.  The new (reset) Internet User Password will be immediate effective.

The following table summarizes the operating hours of the CCASS Internet System:

Function Types	Service Hours
	Day		Time
Notice Board	Daily	24 hours (Note)
Stock Segregated Account Transfer Instruction (STI)	Daily	00:00-07:00* (Note) 07:00 - 19:00 19:00 - 00:00*
Voting	Daily	24 hours (Note)
Corporate Activities	Daily	24 hours (Note)
Enquire Issuer Announcement	Daily	24 hours (Note)
Enquire Stock Account Balance	Daily	24 hours (Note)
Enquire Stock Account Movement	Daily	24 hours (Note)
Enquire Stock Segregated Account Profile	Daily	24 hours (Note)
Stock Segregated Account Statement	Daily	24 hours (Note)
Change Internet User Password	Daily	24 hours (Note)
Rules and Procedures	Daily	24 hours (Note)
Frequently Asked Questions	Daily	24 hours (Note)