SEHK Trading Rule Enforcement 

Introduction

The Stock Exchange of Hong Kong (SEHK) Rule Enforcement Framework consists of three elements: (i) prevention, (ii) detection and (iii) correction. Details of these elements are set out below.

  • PREVENTION

In a bid to prevent and deter Exchange Participants from non-compliance with the Trading Rules, the Exchange will continue its effort in market communication and education in order to enhance the Exchange Participants’ understanding of the Trading Rules including conducting briefing sessions and issuing FAQs and circulars.

  •  DETECTION

In addition to the Exchange’s market surveillance and monitoring work and self-reporting of non-compliance by Exchange Participants, the Exchange will introduce an Annual Attestation and Inspection Programme as follows:

1. Self-Attestation of Compliance

Each Exchange Participant will be required, on an annual basis, to complete and return a questionnaire in the form prescribed by the Exchange, in which the Exchange Participant is required to attest its compliance with the Trading Rules (or a specific section of the Trading Rules) during the relevant period. The Exchange Participant’s response to the questionnaire as well as its compliance history will, among other factors, form the basis of the Exchange’s assessment of the Exchange Participant’s risk profile. The Exchange may conduct follow-up enquiries with Exchange Participants based on their risk profiles and may conduct investigations or on-site inspections at the Exchange Participants’ premises.

2. On-site Inspection

The Exchange will conduct risk-based on-site inspections at selected Exchange Participants’ premises in relation to one or more priority areas as the Exchange may determine from time-to-time in consultation with the SFC. The Exchange will take into consideration the overall levels of activity of Exchange Participants in the priority areas in determining the Exchange Participants that will be subject to on-site inspections. The Exchange Participants subject to on-site inspections will be evaluated on their compliance with the relevant Trading Rules and the Exchange may conduct further investigations based on such evaluation.

  • CORRECTION

The Exchange will continue its effort to address any deficiencies and incidents of non-compliance by Exchange Participants identified through various rectification measures and may commence disciplinary actions against Exchange Participants in accordance with the Trading Rules.


Links to Circulars

Presentation Materials and Rules Guidance

Questionnaires

Electronic Submission of Questionnaires

Participants are required to submit the completed questionnaires via the ECP. For submission requirements and details, please refer to the instructions section of the questionnaire and the ECP User Guide.

For enquiries, please contact Market Surveillance and Monitoring at surveillance@hkex.com.hk