HKEX Launches Master SPSA Service for Fund Managers

Source: Regulation Asia Editors, Regulation Asia 2020-07-10

The new service allows pre-trade checking of China A shares for northbound Stock Connect trading at the fund manager or aggregate level.

HKEX (Hong Kong Exchanges and Clearing) on Friday (10 July) launched the Master Special Segregated Account (Master SPSA) service, part of its latest service enhancement to support Stock Connect.

The new optional service, first announced in March, will facilitate more efficient pre-trade checking of Northbound sell orders and average pricing execution at the fund manager level.

Under Stock Connect, China A shares must be available for pre-trade checking before they can be sold. The original SPSA service was set up in 2015 for institutional investors to satisfy this requirement, removing the need to transfer shares they control to executing brokers prior to a sale.

The Master SPSA builds upon the existing SPSA service, allowing pre-trade checking to be conducted at a fund manager or aggregate level, thereby increasing operational efficiencies while maintaining the same post-trade settlement processes at the individual SPSA level for consistency.

The new service will be particularly useful to fund managers which own and/or maintain more than one SPSA with one or multiple custodians, as it allows for the aggregation of sellable balances of individual SPSA IDs by mapping them to a single Master SPSA ID.

A one-off application fee of HKD 50,000 will be imposed per Master SPSA ID. The application process will take approximately five business days.

HKEX

SPSA

HKEX Launches Master SPSA Service for Fund Managers

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