Becoming a HKSCC Participant

Criteria

(Please also see Chapter 3 of the Rules of Hong Kong Securities Clearing Company Limited ("HKSCC"))

1)	The requirements of Direct Clearing Participantship of HKSCC are as follows :-
		be an Exchange Participant of SEHK.
		undertake to (i) sign a Participant Agreement with HKSCC; (ii) pay to HKSCC an admission fee of HK$50,000 in respect of each Stock Exchange Trading Right held by it; and (iii) pay to HKSCC its contribution to the Guarantee Fund of HKSCC as determined by HKSCC from time to time subject to a minimum cash contribution of the higher of HK$50,000 or HK$50,000 in respect of each Stock Exchange Trading Right held by it.
		open and maintain a single current account with one of the CCASS Designated Banks and execute authorisations to enable the Designated Bank to accept electronic instructions from HKSCC to credit or debit the account for CCASS money settlement, including making payment to HKSCC.
		provide a form of insurance to HKSCC as security for liabilities arising from defective securities deposited by it into CCASS, if so required by HKSCC.
		have a minimum liquid capital of HK$3,000,000 (as imposed by the Board of HKSCC on 3 October 2005)*.

		(*Note: HKSCC imposes additional financial/capital requirement on new clearing participantship applications from time to time. Before submitting your firm's application to HKSCC/applying for relevant licence(s) from regulator, your firm is strongly advised to contact CCASS hotline (2979 7111) to understand the latest financial requirement.)

2)	The requirements of General Clearing Participantship of HKSCC are as follows :-
		(a)	be a licensed corporation which is licensed to carry on Type 1 regulated activity under the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong); or
		(b)	be a registered institution which is registered to carry on Type 1 regulated activity under the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong)
		(if the applicant is a licensed corporation)
		(a)	be a company limited by shares incorporated in Hong Kong; and
		(b)	have and undertake to maintain liquid capital of not less than (1) HK$100,000,000 provided that if it has entered into valid clearing agreements with no more than five NCPs, an additional HK$20,000,000 for each NCP after the fifth NCP with which it has entered into a valid clearing agreement, subject to a maximum of HK$390,000,000; or (2) its required liquid capital under the Financial Resources Rules, whichever is the higher.
		(if the applicant is a registered institution)
		have Tier 1 capital under the Banking (Capital) Rules of not less than HK$390,000,000 or such other level as prescribed by HKSCC from time to time.
		demonstrate to the satisfaction of HKSCC that it has an established clearing business in securities listed and/or traded on the Exchange or it has the financial and operational capacity to establish and operate a clearing business in securities listed and/or traded on the Exchange.
		undertake, if its application is successful, to sign a Participant Agreement; to pay to HKSCC as provided in the Participant Agreement an admission fee of HK$50,000 or HK$50,000 in respect of each Stock Exchange Trading Right held by the applicant (if applicable) whichever is the higher (or such other amount as may be specified by HKSCC from time to time); to pay to HKSCC its Contribution in accordance with the Rules; to arrange indemnity insurance in a form acceptable to or as prescribed by HKSCC; and to provide, if required, assurances acceptable to HKSCC in respect of its obligations to HKSCC as a result of its participation in CCASS, including, but not limited to, liabilities for defective Eligible Securities deposited by it into CCASS, such assurances to be in the form of insurance or in such other form as shall be acceptable to HKSCC; and to procure the agreement of its Designated Bank to comply with the requirements of HKSCC for CCASS money settlement purposes.

3)	The requirements of Custodian Participantship of HKSCC are as follows :-
		(a)	be an authorized institution under the Banking Ordinance (Chapter 155 of the laws of Hong Kong); or
		(b)	be a trust company registered under the Trustee Ordinance (Chapter 29 of the laws of Hong Kong); or
		(c)	be or be deemed to be a licensed corporation which is licensed to carry on Type 1 regulated activity under the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) and which is not an Exchange Participant of SEHK; or
		(d)	be the Monetary Authority under the Exchange Fund Ordinance (Chapter 66 of the laws of Hong Kong).
		demonstrate to the satisfaction of HKSCC that it has an established custodian business in securities listed on SEHK or it has the financial and operational capacity to establish and operate a custodian business in securities listed on SEHK; and it has the financial operational capacity to meet the operational requirements stipulated by HKSCC for its transactions in CCASS;
		undertake, if its application is successful, to sign a Participant Agreement; to pay to HKSCC in accordance with the Participant Agreement an admission fee of HK$1,000,000 (or such other amount as may be specified by HKSCC from time to time); and to provide, if required, assurances acceptable to HKSCC in respect of its obligations to HKSCC as a result of its participation in CCASS, including, but not limited to, liabilities for defective Eligible Securities deposited by it into CCASS, such assurances to be in the form of insurance or in such other form as shall be acceptable to HKSCC; and
		if Eligible Securities are accepted for deposit into its Stock Accounts by it, undertake if its application is successful, to provide a form of insurance or other form of assurances acceptable to HKSCC to secure an amount of not less than HK$100,000,000 for the purpose of securing its liabilities for defective Eligible Securities deposited into CCASS. (An applicant which is an authorized institution under the Banking Ordinance (Chapter 155 of the laws of Hong Kong) and which has paid-up share capital of not less than HK$100,000,000 (or its equivalent in a currency freely convertible into HK dollars) need not comply with this item).

Other than Direct Clearing, General Clearing and Custodian Participantship, HKSCC has Clearing Agency, Investor, Stock Lender and Stock Pledgee Participantship. Please refer to Chapter 3 of the Rules of HKSCC for their admission requirements.

HKSCC Participant Admission Criteria and Operational Requirements

Updated 01 Sep 2022