Hong Kong Commercial News reported that the CSRC began cracking down on illegal cross-border securities activities on the 22nd of last month. Citing market sources, Sing Tao Daily said the CSRC recently met in Shenzhen with heads of Hong Kong brokerages to learn about the latest progress in cleaning up mainland legacy clients and again spelled out its regulatory requirements.
The report said the CSRC's requirements include suspending domestic online account opening, and add-on trades must not use mainland IP addresses; all mainland legacy clients must complete remediation within two years, and illegal onshore trading services and other services must stop completely.
Some local brokers have already begun cleanup efforts this week. The three brokerages singled out by the CSRC, namely Tiger Brokers, Futu Securities and Longport Securities, have each rolled out specific adjustments.
According to the South China Morning Post, Bank of East Asia's Shanghai branch has also suspended opening such accounts. HSBC's Shanghai branch has also noted that all funds deposited into investment accounts must comply with Hong Kong regulatory requirements.
The report said that, in addition to banks offering cross-border bank accounts, the tighter rules are also expected to hit insurers such as AIA (01299) and Prudential (02378), as these companies rely heavily on mainland customers traveling to Hong Kong to buy their insurance products.
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