Important: Please read these terms and conditions carefully.
These terms and conditions set out the rights and obligations of you, the Client, and us, the Bank,in connection with your use of the Securities Services. All these terms are legally binding, so please read them through carefully before you agree to be bound by them.
Securities Services Risk Disclosure Statement
The stock market is a rapidly changing market and there is an inherent risk in incurring loss in shares dealing.
Every transaction concluded through and required by The Stock Exchange of Hong Kong Limited (“the Exchange”) is subject to a transaction levy or other levies from time to time imposed by the Exchange. Every Broker is authorised to collect the appropriate transaction levy or other levies in accordance with the rules prescribed by the Exchange from time to time. A copy of the latest rule on this aspect is available from the Exchange on payment of the prescribed charges.
All transactions duly concluded through and recognized by the Exchange are governed by the Rules of the Exchange relating to trading and settlement in particular and shall be binding on both Broker and the Client. A copy of the latest rules on these aspects is available from the Exchange on payment to the Exchange.
The prices of Securities fluctuate, sometimes dramatically. The price of a Security may move up or down, and may become valueless. It is as likely that losses will be incurred rather than profit made as a result of buying and selling or otherwise dealing in Securities.
Growth Enterprise Market (GEM) stocks involve a high investment risk. In particular, companies may list on GEM with neither a track record of profitability nor any obligation to forecast future profitability. GEM stocks may be very volatile and illiquid.
Client should make the decision to invest only after due and careful consideration. The greater risk profile and other characteristics of GEM mean that it is a market more suited to professional and other sophisticated investors.
Current information of GEM stocks may only be found on the Internet website operated by the Exchange. GEM companies are usually not required to issue paid announcements in gazetted newspapers.
Client should seek independent professional advice if Client is uncertain of or has not understood any aspect of this risk disclosure statement or the nature and risks involved in trading of GEM stocks.
The Securities under the Nasdaq-Amex Pilot Program (PP) are aimed at sophisticated investors. Client should consult his/her dealer and becomes familiarised with the PP before trading in the PP Securities. Client should be aware that the PP Securities are not regulated as a primary or secondary listing on the Main Board or the GEM of the Exchange.
Where Securities are received or held overseas, the Client acknowledges that such Securities may not enjoy the same protection as that conferred under the Securities and Futures Ordinance and the Securities and Futures (Client Securities) Rules.
In leaving the Securities in the custody of another person, Client may be exposed to the credit risk of that person.
1.1 In the event of any conflict or discrepancy between these terms and conditions and (a) the terms of any other agreement subsisting from time to time between the Bank and the Client or (b) the terms of any agreement between such Client and any other Bank Affiliate in respect of dealings in Securities, these terms and conditions shall prevail. For the avoidance of doubt, the Client Terms shall apply in relation to the giving of instructions by telephone or via the Internet.
1.2 In these terms and conditions,
“Account” means the Securities Account and/or, as the case may be, the Settlement Account;
“Application” means the application form signed by the Client (including application form signed by the Client with electronic signature) in respect of the Securities Services;
“Bank” means Standard Chartered Bank (Hong Kong) Limited which is registered for Type 1 (dealing in securities), Type 4 (advising on securities), Type 6 (advising on corporate finance) and Type 9 (asset management) regulated activities under the Securities and Futures Ordinance with CE number AJI614 and its successors and assigns;
“Bank Affiliate” means any subsidiary of the Bank and any holding company thereof and any subsidiary of any such holding company;
“Broker” means such broker or brokers as may be appointed from time to time by the Bank to provide broking services in relation to the Securities Services;
“Business Day” means any day (excluding Saturday and Sunday) on which the Bank is open for the transaction of business in Hong Kong;
“Charge” means the charge created by clause 22;
“CCASS” means Central Clearing and Settlement System operated by HKSCC;
“Charged Securities” means all Securities which are now or shall come into the possession, custody or control of the Bank or, where appropriate in the custody of the Nominee, from time to time and for any purpose whatsoever which shall include any additional or substituted Securities and all dividends or interest paid or payable, rights, interests, monies or property accruing or offered at any time by way of redemption, bonus, preference, option or otherwise on or in respect of such Securities or additional substituted Securities;
“Communication” means any notice, statement, request, demand for payment, approval, consent or other communication to be given by the Bank to the Client or by the Client to the Bank;
“Client” means any client, being an individual in his personal capacity, signing (including through electronic signature), and named in, the Application and who has applied to the Bank to subscribe to the Securities Services and in whose name the Securities Account and the Settlement Account are maintained; where the Securities Services are to be jointly subscribed by, and the Securities Account and the Settlement Account are in the joint name of, two or more persons, then unless otherwise specified or the context otherwise requires, “Client” shall mean all of such individuals collectively;
“Client Company” means any company in respect of which the Client directly or indirectly:
(a) owns not less than fifty per cent (50%) of the issued share capital; or
(b) controls not less than fifty per cent (50%) of the voting rights attaching to the issued share capital;
“Dealing System” means any automated dealing system which the Bank may (but without obligation) from time to time provide for the purposes of the Securities Services;
“Exchange” means The Stock Exchange of Hong Kong Limited;
“HKSCC” means the Hong Kong Securities Clearing Company Limited;
“Holding company” and “subsidiary” have the meanings ascribed thereto in Section 2 of the Companies Ordinance;
“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of China;
“Hong Kong dollar” means the lawful currency for the time being of Hong Kong and “HKD” shall be construed accordingly;
“Liabilities” means all monies, liabilities and obligations of whatsoever nature whether actual or contingent which are now or at any time hereafter may be or become due, owing or incurred from or by the Client or any Client Company as primary or collateral obligations to the Bank or any Bank Affiliate and whether or not accrued in connection with the Securities Account, the Settlement Account or the Securities Services or for which the Client or any Client Company may be or become liable to the Bank or any Bank Affiliate on any account or in any manner whatsoever and in whatever currency (whether alone or jointly with any other person and in whatever name, style or firm) together with interest from the date of demand to the date of payment, legal costs and all other costs, charges and expenses incurred by the Bank or any Bank Affiliate (where the Client consists of more than one person, then only monies, liabilities and obligations due, owing or incurred by those persons jointly);
“Nominees” means such entity or entities as may be appointed from time to time by the Bank to provide nominee services in respect of Securities acquired for the Client;
“Securities” has the meaning ascribed thereto in Part 1 of Schedule 1 of the Securities and Futures Ordinance and, for the avoidance of doubt, shall include securities listed or traded on the Exchange or any stock exchange outside Hong Kong;
“Securities Account” means the account opened and maintained by the Client with the Bank for the purposes of the Securities Services, and shall include such account as may from time to time be re-designated or re-numbered;
“Securities Depositary” means any securities depositary, settlement system, dematerialised book entry system or similar system, including, without limitation, CCASS;
“Securities Services” means the services provided by the Bank to the Client of buying and selling Securities for the account of the Client, on instructions given by the Client to the Bank by telephone, facsimile or via the Internet, and all services related or incidental to such activity, in accordance with these terms and conditions;
“Settlement Account” means the bank account or accounts established and maintained by the Client with the Bank which is designated by the Client from time to time to hold funds intended for the settlement of transactions in the Securities Services and/or for the receipt of income, dividends and other payments (if any) in connection with any Securities and/or for the payment of any fees in connection with any Securities, or in the absence of any such designated account(s) subsisting at the relevant time for whatever reason, any other cash account(s) maintained by the Client with the Bank, and shall include such account as may from time to time be re-designated or re-numbered;
“United States dollar” means the lawful currency for the time being of the United States of America and “USD” shall be construed accordingly;
“U.S. Person” includes any natural person who is a citizen of or resident in the United States; a corporation, partnership or other business organisation organised or incorporated under the laws of the United States or any political subdivision thereof, any estate or trust which is administered by an executor or trustee who is a U.S. person or the income of which is subject to U.S. federal income taxation regardless of its source; any account (other than any estate or trust held by a dealer or fiduciary for the benefit of a U.S. person) and any partnership or corporation organised and incorporated under the laws of any foreign jurisdiction which was formed by U.S. person principally for the purpose of investing in securities not registered under the United States Securities Act of 1933. “U.S. Person” shall not include any branch or agency of a United States bank or insurance company that is operating outside the United States for valid business reasons as a locally regulated branch or agency engaged in the banking or insurance business and not formed primarily for the purpose of investing in securities not registered under the United States Securities Act of 1933. For purposes of this definition, the “United States” includes the United States of America, its states, territories and possessions and the District of Columbia. The Bank reserves the right to amend this definition of “U.S. Person” by notice to the Client as may be necessary to conform to applicable law and authoritative interpretation thereof.
1.3 In these terms and conditions, unless the context otherwise requires:
(a) the word “person” includes any individual, company, firm, partnership, joint venture, association, sole proprietorship or other business entity;
(b) words denoting one gender shall include all other genders;
(c) words denoting the singular shall include the plural and vice versa;
(d) headings have been inserted for convenience of reference and shall not affect construction.
1.4 In these terms and conditions reference to an Ordinance is to an Ordinance or law of Hong Kong and any subsidiary legislation related thereto as from time to time amended, codified or re-enacted.
1.5 The Chinese translation of these terms and conditions is provided for convenience only and the English version shall prevail for all purposes. You may call our hotline, visit any of our branches or visit our website (www.sc.com/hk) for the Chinese version.
2A.1 If the Bank solicits the sale of or recommends any Financial Product (as defined in clause 2A.2 below) to the Client, the Financial Product must be reasonably suitable for the Client having regard to the Client’s financial situation, investment experience and investment objectives. No other provision of these terms and conditions or any other document we may ask you to sign and no statement we may ask you to make derogates from this clause 2A.1.
2A.2 “Financial Product” in clause 2A.1 means any securities, futures contracts or leveraged foreign exchange contracts as defined under the Securities and Futures Ordinance (Cap. 571). Regarding “leveraged foreign exchange contracts”, it is only applicable to those traded by persons licensed for Type 3 regulated activity (leveraged foreign exchange trading) (as defined in the Securities and Futures Ordinance (Cap. 571)).
2A.3 The mere provision of marketing or promotional materials relating to any Securities Services for general information purposes does not constitute an offer, recommendation or solicitation by the Bank to the Client.
2A.4 The Client agrees to regularly provide the Bank with information relating to the Client’s risk tolerance, investment objective, investment experience or sophistication, financial situation and financial needs. The Bank uses and relies on this information to help the Client make investment decisions that meet the appropriate risk profile and to ensure, if required, that Financial Products (as defined in clause 2A.2) which the Bank solicits the sale of or recommend to the Client is reasonably suitable for the Client at the point of sale. If there are circumstances or other considerations that the Client feels are relevant, the Client should inform the Bank. The Bank’s investment recommendations will be based on the information the Client provides to the Bank.
2.1 The Client hereby authorises the Bank to buy and sell Securities for the account of the Client and otherwise deal with Securities, receivables or monies held in or for the Securities Account or monies held in or for the Settlement Account upon the instructions of the Client as given in accordance with these terms and conditions.
2.2 The Bank is hereby authorised (a) to act as the agent of the Client relating to the purchase and sale of or other dealings in Securities as well as the registration, withdrawal or collection of Securities or distributions from Securities, or the exercise of any rights or claims arising from or relating to Securities including (without limitation) dividends, rights issues, conditional cash offers or other corporate actions and (b) to provide the Client with information requested by the Client from time to time on the prices of or other information relating to Securities. The Bank is not obliged to provide the Client with any translation of any such information requested by the Client or to ensure that such information is true and accurate where such information is independently prepared by a third party. For the avoidance of doubt, and without prejudice to the generality of clause 23, the Client shall make its decision with respect to investment in Securities. The Bank shall have the absolute discretion to determine whether or not to accept any instructions as to any transactions in Securities given pursuant to these terms and conditions by the Client. The Bank shall not be obliged to give any reason for any refusal to accept or delay in acting on such instructions, nor shall the Bank be held liable for the consequences of any such refusal or delay unless caused by the fraud, wilful default or negligence of the Bank. In particular (without prejudice to the generality of the foregoing) the Bank may refuse to act, or delay in acting, on instructions for the sale of Securities if such Securities are not registered in the name of the Bank or a Nominee or documents of title relating to those Securities are not held by the Bank or a Nominee or where in the opinion of the Bank such instructions are contrary to any applicable laws, rules or regulations and the Bank shall be entitled with the Client’s consent to amend such instructions so that they comply with such laws, rules or regulations. In accepting instructions from the Client, the Bank shall in all circumstances act as the Client’s agent and not as principal.
2.3 Prior to giving instructions to sell any Securities, the Client will advise the Bank of any legal restriction on the transfer of such Securities (including under the Securities Act of 1933 (U.S.)) and will provide the necessary documents to the Bank to satisfy legal transfer requirements. The Client is responsible for any delays, expenses and losses associated with the compliance or failure to comply with any restrictions on the transfer of Securities.
2.4 Where the Bank requires a response from the Client within a specified time frame, the Client acknowledges that failure to respond within such specified time frame may result in the Bank being unable to implement the Client’s instructions.
2.5 If an order cannot be executed or wholly executed, the Bank shall be under no obligation to notify the Client immediately. Accordingly, if the Client requires immediate confirmation as to whether any transaction has been effected he should contact the Bank subsequently. Instructions to buy or sell Securities may be partially executed if the instructions cannot be fully executed. Orders to sell or purchase Securities will, to the extent not by then executed, lapse at the close of trading hours on each Business Day.
2.6 Notwithstanding the terms of any other agreement or course of dealing between the Bank and the Client, the Bank is requested and authorised, but is not obliged, to rely upon and act in accordance with any instruction, notice or other Communication which may from time to time, be, or purport to be, given by telephone, facsimile or via the Internet by the Client (when applicable) without inquiry or verification on the part of the Bank as to the authority or identity of the person making or giving or purporting to make or give such instruction, notice or Communication and regardless of the circumstances prevailing at the time of such instruction, notice or Communication provided that the Bank reasonably believes such instruction, notice or Communication emanated from the Client. The Bank shall not be liable for any losses suffered or incurred by the Client as a result of the Bank acting upon the same.
2.7 The Bank shall be entitled to treat an instruction, notice or Communication given as provided in clause 2.6 as fully authorised by and binding upon the Client. The Bank shall be entitled (but not bound) to act on or take such steps in connection with or in reliance upon such instruction, notice or Communication as the Bank may in good faith consider appropriate, whether it be an instruction to acquire, purchase, sell, dispose of or otherwise deal with Securities or transfer Securities from the Securities Account or purports to bind the Client to any agreement or other arrangement with the Bank or with any other person or to commit the Client to any other type of transaction or arrangement whatsoever, regardless of the nature of the transaction or arrangement or the value, type and quantity of the Securities involved and notwithstanding any error or misunderstanding or lack of clarity in the terms of such instruction, notice or Communication.
2.8 In the event that the Bank does not consider any communications to be genuine or to have been given by the Client or on its behalf, the Bank may decline to act and the Client hereby releases the Bank from any liability whatsoever or howsoever arising, directly or indirectly, from or as a result of the Bank’s inaction or omission.
2.9 The Bank may record all telephone conversations with the Client in order to verify the instruction or Communication of the Client but it shall not be obliged to do so. The Bank may also maintain records of instructions or Communications received from the Client via the Internet. In case of dispute, the Client agrees to accept the contents of any such telephone recording or computer record as final and conclusive evidence of instructions or Communications from the Client.
2.10 The Client agrees and acknowledges that the Application can be signed by the Client with electronic signature through the internet and/or mobile application portal made available at the discretion of the Bank. Such electronic signature shall be in such digital form as determined by the Bank in its discretion. If the Application is made available to the Client under such portal, terms and conditions, fees and charges, important notes and disclosure statements (if any) applicable to such portal shall apply in addition to these terms and conditions.
- Appointment of Brokers, Nominees and Agents
3.1 The Bank has express authority from the Client to appoint Brokers, Nominees and other agents including custodians and sub-custodians and to terminate any such arrangements with said Brokers, Nominees and other agents and to appoint replacement Brokers, Nominees and/or other agents. The Bank shall use reasonable care in the selection and appointment of such Brokers, Nominees and/or other agents.
3.2 The Client agrees that the Bank shall have full power and authority to negotiate and agree for and on behalf of the Client all arrangements in respect of brokerage, nominee or custodian services with Brokers, Nominee and/or custodians, or other agents and, in relation to any termination, appointment or replacement appointment, to instruct such Brokers, Nominees and/ or custodians or other agents to make suitable arrangements in respect of the completion of transactions and transfer of securities including, without prejudice to the foregoing the transfer of securities into the name of a replacement Nominee.
- Funding of Purchases : Restrictions on Withdrawals
4.1 The Bank shall debit and make payments from the Settlement Account without further instructions from the Client, and the Client hereby authorises the Bank to debit the Settlement Account:
(a) with an amount (including the purchase price and all related accrued interests, fees, costs and expenses) required to be paid by the Client pursuant to any transaction effected under these terms and conditions; and
(b) all taxes, fees, disbursements, charges and expenses properly payable by the Client pursuant to these terms and conditions or in respect of the purchase, sale, holding or transfer of Securities or for such other dealings in Securities.
4.2 It is a fundamental condition that the Client shall ensure, and the Client undertakes and warrants, that at all times there shall be available in the Settlement Account funds sufficient to satisfy all payments due in relation to any purchase of Securities instructions for which have been issued to the Bank hereunder, including the relevant purchase price together with the relevant stamp duties, relevant commissions and other charges payable or to be incurred in connection with such purchase. The Bank is authorised, at any time after receipt of such instruction, at its discretion to place a stop order to earmark such amount of the funds in the Settlement Account required to satisfy all amounts payable in relation to such purchase. In the event that the Settlement Account becomes overdrawn, the overdrawn amount will be considered a loan payable on demand, and shall be subject to a rate of interest customarily charged by the Bank for similar loans as determined by the Bank from time to time. If there is no or insufficient cash held in the Settlement Account in the currency in which the Client has instructed the Bank to make a payment, then the Bank is authorised (but not obliged) by the Client to make such conversions of cash (at such rates of exchange as the Bank shall determine on the date of conversion) held in any other currency in the Settlement Account as may be required for such payment.
4.3 Notwithstanding any term of any other agreement between the Bank and the Client, following the giving of such instructions, and whether or not any earmarking of funds has been effected as aforesaid, the Client shall not be entitled to and shall not withdraw or otherwise utilise, by cheque or otherwise, and the Bank shall not be obliged to release or pay out of the Settlement Account, any of the amount required to settle the purchase unless and until the Bank is notified that the instruction to purchase has for any reason not been executed and subject to rights arising pursuant to clause 21. Accordingly, the Bank is irrevocably authorised, notwithstanding any provision of any other agreement or arrangement between the Client and the Bank from time to time:
(a) to refuse to honour any cheque or other payment drawn or debited against the Settlement Account and/or to delay in taking any such action, during any period between the issue of instructions to purchase Securities for the account of the Client and the application of funds payable in relation to the purchase the subject of such instructions; and
(b) to apply monies in the Settlement Account in settlement of any sums payable in relation to any such purchase in priority to any other proposed application of such funds instructed or purportedly instructed upon by the Client.
4.4 The Client acknowledges and agrees that if at any time there are in the reasonable opinion of the Bank (having regard to other payments debited or due to be debited) insufficient funds in the Settlement Account for these purposes the Bank may (in the Bank’s sole discretion and without any obligation to do so on the part of the Bank) transfer funds as necessary from any other account or accounts maintained by the Client with the Bank without further instruction or sanction from the Client.
4.5 For the purposes of placing a stop order on such funds in the Settlement Account and/ or prohibiting withdrawal or utilization of such funds, the Bank shall be entitled to assess an approximate amount using such guidelines as it may determine from time to time and subsequently to adjust such amount following notification by the Broker of the precise amount due from the Client in respect of such purchase.
4.6 The Bank is authorised to deliver to the Brokers on behalf of the Client such funds, share certificates and other documents relating to Securities as it may receive or hold in connection with dealings in Securities effected pursuant to instructions received or purportedly received from the Client.
4.7 By these terms and conditions, the Client expressly authorises the Bank to part with possession of Securities for the exercise of any lien or charge in these terms and conditions or pursuant to any sale of Securities permitted by these terms and conditions including any sale to realise monies to make any payment due to the Bank pursuant to these terms and conditions.
4.8 The Bank shall promptly credit to the Settlement Account all cash received by it for the account of the Client from the sale of Securities held on behalf of the Client pursuant to these terms and conditions.
4.9 The Bank reserves the right to debit or credit the Settlement Account if it has been inadvertently credited or debited. The Settlement Account will be governed by current account principles. The Bank’s obligation to pay the Client any amounts and/or repay any funds in the Settlement Account is an obligation of the Bank in Hong Kong, where the Settlement Account is opened.
4.10 The Client agrees that if the Bank shall for any reason fail to receive payment for all or any part of any amount due to be paid to the Client in respect of any sale entered into by the Client or by the Bank on the Client’s behalf on the due date for payment in accordance with the rules and regulations of the relevant exchange and/or any applicable laws, the Bank’s obligation to make payment to the Client in respect of such sale shall by virtue of such failure become an obligation to make payment of such amount as is equal to such payment as is actually received by the Bank.
- Client’s Default in Funding
5.1 Unless otherwise agreed between the Client and the Bank, the Client agrees that if insufficient funds are available in the Settlement Account as required by clause 4.2, the Bank is authorised:-
(a) In the case of a purchase transaction, to transfer or sell such purchased Securities to satisfy the Client’s obligations to the Bank; or
(b) In the case of a sale transaction, to borrow and/or purchase such sold Securities to satisfy the Client’s obligations to the Bank.
5.2 The Client acknowledges that he will be responsible to and will indemnify and keep indemnified the Bank from any loss, costs, fees and expenses in connection with the Client’s failure to meet his obligations by the settlement dates required.
- No margin or credit facilities
These terms and conditions shall apply to an account for cash dealing only. Nothing in these terms and conditions shall oblige the Bank or any Bank Affiliate to grant or maintain any margin or credit facilities.
- Registration of Securities
7.1 Subject to the provisions of clause 7.2 and clause 21, the Client agrees that any Securities deposited with the Bank or acquired by the Bank on behalf of the Client or any amounts paid to the Bank on behalf of the Client shall be dealt with in accordance with the instructions of the Client given in respect of the particular Securities or monies.
7.2 The Bank shall register Securities acquired for the Client in the name of the Bank or the Nominee or may deposit securities with, or hold securities in, CCASS or any other Securities Depositary on such terms as such Securities Depositary customarily operates.
7.3 The Nominee shall hold Securities registered in its name as the nominee of the Bank. The Nominee shall designate all such Securities as held by it to the order of the Bank but identified as being Securities held by the Bank for the Clients and being identified as Securities of which the Bank is not the beneficial owner. The Client shall not give any instruction to the Nominee direct.
7.4 The Client acknowledges and agrees that Securities from time to time acquired and/or held through or in CCASS shall be held subject to and in accordance with CCASS Rules.
- Securities Fungible
8.1 Any securities deposited with the Bank or purchased for the Securities Account may, at the absolute discretion of the Bank, either be treated as fungible or specifically allocated to the Securities Account.
8.2 Any obligation of the Bank to deliver, or to hold in safe custody, Securities purchased or acquired on behalf of the Client shall be satisfied by the delivery; or the holding, of Securities being identical with such Securities in terms of number, class, denomination, nominal amount and rights attached thereto (subject always to any capital reorganisation which may have occurred in the meantime affecting such Securities).
- Securities Account: Withdrawals
9.1 Subject to clause 9.2, the Bank shall as soon as reasonably practicable after having been required to do so by instructions from the Client:
(a) procure the registration of any Securities from time to time forming part of the Securities Account in the name of the Client or a person notified by the Client as being the nominee of the Client, or if so instructed, deliver the documents representing the Securities to the Client or such a nominee whereupon such Securities shall cease to form part of the Securities Account;
(b) transfer such sum as may be specified in the instructions of the Client from the Securities Account to the Settlement Account and such transfer shall be deemed a good discharge of the obligation to make payment to the Client.
9.2 The obligations of the Bank in clause 9.1 shall be subject to the other provisions of these terms and conditions and in particular clause 21 and to the right of the Bank to require that prior to any withdrawal the Client discharges in full all sums or liabilities actual or contingent owed by the Client or any Client Company to the Bank or any Bank Affiliate. The Bank may without Client instruction or notice to the Client discharge any such liabilities out of monies standing to the credit of the Accounts prior to implementing any registration or transfer pursuant to clause 9.1 or otherwise may require payment thereof to be made by the Client prior to implementing any registration or transfer pursuant to clause 9.1.
9.3 The Bank reserves the right to debit or credit the Securities Account if it has been inadvertently credited or debited.
- Securities Account: Additions
The Client may at any time request that the Bank accept delivery or a transfer of Securities to be held as part of the Securities Account. The Bank shall not be obliged to accept any such request but, if it does so, the Securities so delivered or transferred shall be held as part of the Securities Account and shall be subject to these terms and conditions as if they were acquired by the Bank on behalf of the Client. In such case, the Client shall execute such instruments of transfer and/or other documents as may be required to transfer the Securities to the Securities Account and register them in the name of the Bank or the Nominee, or deposit, and hold, them in CCASS or any other Securities Depositary.
- Trading Limits
11.1 The Client acknowledges that the Bank has the right to set limits and parameters to control the Client’s ability to use the Securities Services at the Bank’s absolute discretion and the Client undertakes to comply with those limits and parameters. Such limits and/or parameters may be amended, increased, decreased, removed or added to the Securities Services by the Bank in its absolute discretion and may include (without limitation): (i) controls over maximum order amounts and maximum order sizes, (ii) controls over the Bank’s total exposure to the Client, (iii) controls over the price at which orders may be submitted, (iv) controls over the origin of the Client’s orders and (v) any other limits, parameters or controls which the Bank may be required to implement under any applicable law or regulation.
11.2 The Client acknowledges that orders will be accumulated over the trading day and the Bank will check all orders received by whatever means of communication against the credit limits and trading limits as specified by the Bank from time to time.
- Execution of transactions by the Bank
12.1 In executing the Client’s instructions from time to time:-
(a) to acquire or purchase Securities, the Bank shall be authorised at its discretion to transfer to the Client Securities owned or held by (i) the Bank or (ii) any Bank Affiliate;
(b) to sell or dispose of Securities, the Bank shall be authorised at its discretion to acquire or purchase such Securities (i) for the Bank’s own account or (ii) for account of a Bank Affiliate.
12.2 The Bank will act as principal in the circumstances as described in clause 12.1(a)(i) and clause
12.1(b)(i) and subject thereto will act as an agent (in the capacity of a broker) and not as a principal.
12.3 By reason of physical restraints on the Exchange or on any other stock exchange and rapid changes in the prices of Securities that frequently take place, there may, on occasions and despite the Bank’s reasonable endeavours, be a delay in making prices or in dealing at any specific time or “at best” or “at market”. The Client agrees in any event to accept and be bound by dealings which take place on his behalf and agrees that the Bank shall not be liable for any loss arising by reason of its failing, or being unable, to comply with any terms of an order of the Client unless caused by the fraud, wilful default or negligence of the Bank.
12.4 The Bank may aggregate the Client’s order with the Bank’s own orders, and those of persons connected with the Bank and its other clients. This procedure may operate on some occasions to the Client’s advantage and on others to its disadvantage. However, where the Bank has aggregated its client’ orders, including the Client’s order, with the Bank’s own order it will give priority to satisfying the orders of its clients in any subsequent allocation if all orders cannot be filled.
12.5 Unless the Client gives specific instructions to the Bank to the contrary, the Client acknowledges that all orders or requests are good for the day only and that to the extent unfulfilled they will lapse at the end of the official trading day of the Exchange or, as the case may be, the stock exchange outside Hong Kong on which the Securities in question are listed or traded.
- Short Sales
13.1 The Client agrees that all sale orders submitted to the Bank are long sale orders, i.e., the Client represents that the Security to be sold is owned by the Client (or any person for whom the Client is acting) and that the Client has forwarded the Security to the Bank.
13.2 Whenever any instruction to be given by the Client is an instruction to sell in respect of Securities which the Client does not own i.e. is a short sale, the Client undertakes to inform the Bank immediately of the same.
13.3 The Client acknowledges that the Bank will not accept an instruction to sell for short account on behalf of the Client. The Bank shall not be responsible to the Client for identifying whether or not an instruction is to sell for short account.
- Contract Notes
The Bank shall within the period from time to time specified under the Securities and Futures Ordinance or the subsidiary legislation related thereto or the rules of the Exchange, or of any other stock exchanges as amended from time to time, send to the Client copies of the contract note relating to any transactions in Securities effected by the Bank for the Securities Account. The Bank shall dispatch the copy of the contract note to the Client either at the last mailing address on record with the Bank or send the copy of the contract note via Online Channel and inform the electronic delivery of the contract notes by email notification to the Client at the last email address on record with the Bank. The Client shall upon receipt of the contract note examine the same and to promptly give notice to the Bank if the Client considers that any details stated therein are incorrect in any respect. If the Bank does not receive any written objection from the Client within the period stipulated in a contract note for this purpose, the Client shall be deemed to have accepted all the transaction details contained as true and accurate in all respects.
15.1 The Bank shall send the Client monthly statements showing the position of the Securities Account and the Settlement Account. Such statement shall be in the form and contain the information as the Bank may from time to time determine.
15.2 The Bank shall send to the Client such information relating to the Securities Account and the Settlement Account as the Client may from time to time reasonably require in writing.
15.3 The Client shall upon receipt of a monthly statement examine the same. If the Bank does not receive any written objection from the Client in respect of any details stated in a monthly statement within the period stipulated in the statement for this purpose, the Client shall be deemed to have accepted the same as true and accurate in all respects. Notwithstanding the foregoing, the Client shall not have the right to object to details contained in a monthly statement if those details have already been previously stated in a contract note which have been accepted by the Client as true and accurate.
15.4 The Bank shall dispatch the monthly statement and any other information requested in accordance with clause 15.1 and clause 15.2 respectively to the Client either at the last mailing address on record with the Bank or send the monthly statement and inform the electronic delivery of the monthly statement by email notification to the Client at the last email address on record with the Bank.
- Expenses and Fees
16.1 In consideration of the Bank agreeing to provide the Securities Services, the Client agrees and acknowledges that the Bank shall be entitled to charge the Client fees and charges to be computed on such basis as may be notified to the Client from time to time and the Bank shall be entitled to revise the level of fees and charges and/or impose charges for any services by giving reasonable notice to the Client.
16.2 The Bank is irrevocably authorised to debit the Settlement Account with all fees and charges levied by the Bank, and to so debit and pay to the Brokers or the Nominees as the Brokers or the Nominees may direct or to any other payee entitled thereto, all commissions payable in respect of such transactions and all stamp duties, taxes, bank charges, transfer fees, registration fees, interest and other expenses incurred or to be incurred in respect of or in connection with the Settlement Account or any dealings in Securities effected in pursuance of instructions received or purportedly received from the Client or holding of Securities on behalf of the Client pursuant to these terms and conditions.
16.3 The Client acknowledges that the Bank may pay CCASS, or other Securities Depositaries, settlement fees on a consolidated basis and the Bank is entitled to retain any rounding differences as a result of the payment of such fees on such basis.
All dividends and other distributions in cash derived from Securities held by the Bank in the Securities Account shall be credited to the Settlement Account.
- Corporate Actions
18.1 The Bank shall use reasonable endeavours to notify the Client with regard to communications in respect of distributions or pecuniary entitlements requiring any election or decision by the Client received by the Bank or the Nominee in respect of Securities held in the Securities Account and the Bank shall not be liable for any non-receipt, delay or failure in forwarding communications in sufficient time for instruction to be given by the Client save in the case of fraud, wilful default or negligence of the Bank. In the absence of or delay in receiving instructions from the Client in response to a notification in accordance with this clause 18.1, the Bank shall be authorised, at its discretion, to take such steps as it may consider expedient to enable it to provide the Securities Services including the right to act or refrain from acting in accordance with the default option as specified in such notification.
18.2 The Bank shall not be under any duty to investigate or participate in any meeting or any subscription, conversion or other rights in respect thereof or as regards any merger, consolidation, reorganisation, receivership, bankruptcy or insolvency proceedings, compromises or arrangement or to take any affirmative action in connection therewith or procure that the Nominee do so except in accordance with written instructions issued by the Client and upon such conditions as to indemnity, provisions for expenses and otherwise as the Bank may at that time require in its favour and in favour of the Nominee.
18.3 The Bank shall be authorised in respect of Securities registered in the name of the Nominee to do the following or instruct the Nominee to do so:
(a) to request payment of and receive all interest, dividends and other payments or distributions in respect of the Securities;
(b) where monies are payable to or for the benefit of the Client in respect of any of the Securities in more than one currency, to collect them in such currency as may be permissible by law and as the Bank may in its sole and unfettered discretion determine;
(c) to surrender any of the Securities against receipt of the monies payable at maturity or on redemption if called prior to maturity and provided that where Securities are called for redemption prior to maturity the Bank and the Nominee shall have no duty or responsibility to present the Securities for redemption, unless, after call is made, the Client requests the Bank in writing so to do;
(d) to complete and deliver on behalf of the Client as owner any ownership certificates in connection with the Securities which may be required by law;
(e) in its sole and unfettered discretion to comply with the provisions of any law, regulation or order now or hereafter in force which purports to impose on a holder of any of the Securities a duty to take or refrain from taking any action in connection with any of the Securities or payments or distributions or monies payable in respect of any of the Securities; and
(f) to exchange any documents relating to any Securities, where such documents have been issued in interim or temporary form, for documents in definitive form.
- Conflict of Interest
19.1 The Client acknowledges that when the Bank deals for the Securities Account it may have an interest, arrangement or relationship that is material in relation to the investment or transaction concerned. Such interests will not necessarily be separately disclosed to the Client prior to or at the time of any transaction or at any other time. The following interests of the Bank may affect the Client (without limitation):-
(a) the Bank may have acted, may be acting or may seek to act as a financial adviser or lending banker to the issuer (or any of its affiliated companies) of the Securities in which the Client may be dealing or may have advised or may be advising any person in connection with a merger, acquisition or take over by or for such issuer (or any of its affiliated companies);
(b) the Bank may have a holding, dealing, or market making position or may otherwise be trading or dealing in the Securities or assets of any kind underlying, derived from or otherwise directly or indirectly related to such Securities;
(c) the Bank may have received or may be receiving rebates, payments or other benefits for giving business to the Brokers;
(d) the Bank may have sponsored or underwritten or otherwise participated in, or may be sponsoring or underwriting or otherwise may be participating in a transaction;
(e) the Bank may have been or may be an affiliate of an issuer (or any of its affiliated companies) of the Securities in which the Client may be dealing.
19.2 Nothing herein contained shall be deemed to inhibit the Bank from:
(a) instructing or otherwise procuring the purchase for the Client of Securities held by the Bank for its own account or held by any other of its Clients; or
(b) acting in any capacity for any other person or from buying, selling, holding or dealing in any Securities for its own account or that of any other Bank Affiliate notwithstanding that instructions have at any time been received from or on behalf of the Client for the purchase, sale or holding of or other dealing in the same or similar Securities; or
(c) purchasing or procuring the purchase for its own account or for the account of any other of its Clients Securities of the same type as or a similar type to any Securities in respect of which instructions have at any time been received from the Client; and the Client hereby acknowledges and agrees that the Bank may so act, buy, sell, hold, deal, or instruct provided that in any such case the terms of any such dealing are not less favourable to the Client than they would have been had the transactions been entered into with a party other than the Bank or one of its Clients.
19.3 The Bank shall not be liable to account to the Client for any emoluments, commissions, profits or any other benefits whatsoever earned by it in relation to any transaction in Securities effected in pursuance of instructions received from the Client.
19.4 The Bank shall not be under any duty to disclose to the Client any fact or thing which comes to its knowledge or notice in the course of acting in any capacity for any other person or in its own capacity.
- Dealings with the Accounts
The Client agrees not to, and not to purport to, assign, grant an interest over or otherwise deal in any way with, nor (without the Bank’s prior written consent) to create or allow to subsist a charge, pledge or other encumbrance over:
(a) the Securities Account or any Securities, receivables or monies held in or for the Securities Account; or
(b) all or any part of the monies from time to time standing to the credit of the Settlement Account.
- Set-off and Lien
Notwithstanding anything contained herein or in any other agreement between the Bank or any Bank Affiliate on the one part and the Client (or any Client Company) on the other part, the Bank may upon the occurrence of an Event of Default set out in clause 36 and without prior notice to or consent of the Client, set off and withhold from, apply and/or transfer (as the case may be) monies, securities and/or receivables held in or for the Settlement Account, the Securities Account or any other account held for the Client (or, if the Client consists of more than one party, any one or more of such parties) with the Bank (and whether or not such monies, securities or receivables are held for the Client individually or jointly with others) against and in full or partial settlement of Liabilities. For the purpose of exercising the right of set-off or of discharging any sums or liabilities aforementioned, the Bank may sell or dispose of any of the Securities or receivables from time to time held in or for the Securities Account or any other account with the Bank or a Bank Affiliate, if any relevant obligation or liability is not discharged in full by the Client. The Bank or a Bank Affiliate shall be under no duty to the Client as to the price obtained in respect of any such sale or disposal. The rights of the Bank set out in this clause 21 shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other right to which the Bank or any Bank Affiliate is at any time otherwise entitled (whether by operation of law, contract or in any other manner whatsoever). The Client hereby irrevocably directs the Bank to take all necessary action and effect all necessary transfers in this respect.
- Charge Over Securities Account
22.1 The Client hereby charges the Charged Securities as continuing security for the payment and satisfaction on demand of all Liabilities and the performance of all obligations of the Client under these terms and conditions and including any costs, charges and expenses including legal fees of enforcing these terms and conditions and the Charge contained in this clause incurred by the Bank or any Bank Affiliate.
22.2 Upon the occurrence of an Event of Default set out in clause 36 or the failure of the Client to settle the Liabilities when due or perform its obligations under these terms and conditions:-
(a) the Charge contained in this clause shall be immediately enforceable; and
(b) the Bank (or where appropriate the Nominee acting upon instructions from the Bank) may,
without notice to the Client:-
i) appropriate, transfer or set-off the whole or any part of any monies comprised in the Charged Securities in or towards payment or discharge of any of the Liabilities hereby secured; and/or
ii) sell or dispose of the Charged Securities or any part thereof either together or in parcels in such other manner and for such consideration (whether payable or deliverable immediately or by installments) as the Bank may think fit.
22.3 The Bank and the Nominee shall not be in any way responsible for any loss occasioned by action pursuant to clause 22.2 howsoever arising unless it is caused by the negligence or wilful misconduct of the Bank.
22.4 Without prejudice to the generality of clause 22.2, the Bank (or, where appropriate, the Nominee) shall be entitled to appropriate to the Bank or sell or dispose of the Charged Securities or any part thereof at the current market price thereof to any Bank Affiliate without being:-
(a) in any way responsible for any loss occasioned thereby howsoever arising; and
(b) accountable for any profit made by the Bank (or, where appropriate, the Nominee as its agent) and/or any Bank Affiliate.
22.5 In the event of any sale or disposal pursuant to this clause 22, if less than all of the Charged Securities are to be sold or disposed of, the Bank (or, where appropriate, the Nominee) may in the Bank’s absolute discretion select which of the Charged Securities are to be sold or disposed of.
22.6 In the event of any deficiency after the sale or disposal of the Charged Securities, the Client hereby undertakes to make good and pay on demand to the Bank such deficiency.
22.7 The amounts realised by the exercise or enforcement of the Charge contained in this clause shall be applied against the liabilities of the Client or any Client Company in such order of priority as the Bank may in its absolute discretion determine.
22.8 The Charge contained in this clause is in addition to and without prejudice to any collateral or other security which the Bank or any Bank Affiliate may by these terms and conditions or otherwise whether now or hereafter hold from or on account of the Client or any Client Company and shall be a continuing security notwithstanding any intermediate payment or settlement of account or satisfaction of the whole or any part of any sum or sums of money owing by the Client or any Client Company. Without prejudice to the foregoing, the Charge contained in this clause shall subsist and continue to have full force and effect after the termination of these terms and conditions until the Client and any Client Company has fully discharged all of its obligations to the Bank and any Bank Affiliate.
22.9 Any monies realised pursuant to the Charge contained in this clause may be placed and kept to the credit of a suspense account for so long as the Bank or the relevant Bank Affiliate may in its absolute discretion determine without any obligation in the meantime to apply the same or any part thereof in or towards discharge of any monies or liabilities due or incurred by the Client or any Client Company to the Bank or any Bank Affiliate.
22.10 The Charge contained in this clause shall not be prejudiced any amendment or variation to these terms and conditions or by the liquidation, insolvency or bankruptcy of the Client or any Client Company.
- Automated Quotations and Confirmations
23.1 The Client acknowledges that any quotes on the price of Securities, any market data and any other information provided via any automated quotation system maintained by the Bank (which may be received or accessed by the Client by internet, telephone or other tele-electronic means) are provided by an independent third party, subject to a disclaimer by such third party and the Exchange to the following effect: “[Third party] and The Stock Exchange of Hong Kong Limited endeavour to ensure the accuracy and reliability of the information provided but does not guarantee its accuracy and accepts no liability (whether in tort or contract or otherwise) for any loss or damage arising from any inaccuracies or omissions”. The Bank is not responsible for the accuracy, timeliness or completeness of such information.
23.2 All orders shall be executed at the then current market prices and neither the Bank nor any of the Brokers represent to the Client that any order will be executed at a price previously quoted to the Client by way of an automated quotation system or otherwise.
23.3 If the Client has registered to receive SMS/email order confirmation, the Client will receive notification from the Bank by SMS or email message (a) when an order has been partially or fully executed on the Exchange, (b) when the Exchange has accepted the Client’s instruction to cancel an order, (c) when an order has expired because it has not been executed by the close of the period of validity of the order, and (d) when an order has been rejected either by the Bank or the Exchange, for whatever reason. The Bank gives no warranty as to the timeliness or reliability of SMS/email communications, and shall have no liability in the event that the Client fails to receive such communication except where it is caused directly by the negligence or wilful default of the Bank. The Bank will from time to time specify the scope and features of the SMS/email order confirmation service, and may modify, expand or reduce it at any time with or without notice. If the Client places his order via telephone, and has not registered to receive SMS/email order confirmation, the Bank will endeavour to notify the Client by telephone of the status of an order.
23.4 Any written confirmation sent out by the Bank, in the form of a contract note or monthly statement, shall (save in the case of manifest error) be conclusive as to the price at which any particular order has been executed and shall be deemed to have been accepted by the Client if not objected to in writing by the Client within the period (if any) stipulated in such statement for this purpose. The Client acknowledges that any statement given over the telephone or by SMS or email message or other electronic means as to the status of the Settlement Account or any particular transaction is provided for information only and is not binding on either the Bank or on any Broker.
- Liability and Indemnity
24.1 In the absence of fraud, negligence or wilful default, neither the Bank nor any of its officers, employees or agents shall be liable to the Client for any loss suffered by the Client arising out of or connected with any act or omission in relation to the operation of the Securities Services, the establishment or maintenance of the Accounts and/or transactions effected thereunder.
24.2 In particular, without prejudice to the generality of the foregoing, the Client acknowledges and agrees that:
(a) the Bank shall not be liable to the Client for any loss suffered as a result of or connected with any act or omission on the part of the Brokers or the Nominees, CCASS or any other Securities Depositary, or other agents, including custodians and sub-custodians, including, without prejudice to the generality of the foregoing, any incorrect or incomplete information or advice supplied or published by the Brokers, CCASS, or the Nominees, any other Securities Depositary to the Bank and subsequently communicated to the Client;
(b) The Client agrees that it shall be jointly and severally liable with the Bank to any Broker for all obligations to be performed by the Bank in respect of any transaction in Securities conducted by the Bank as agent for and on behalf of the Client.
(c) the Bank shall not be obliged to give any advice as to the selection of Securities to the Client or to provide discretionary management services to the Client under these terms and conditions, and each instruction to effect transactions in Securities shall be decided upon and issued by the Client;
(d) the Brokers or other third parties may provide written or oral information or advice to the Bank for the Bank to communicate to the Client; in the absence of fraud, negligence or wilful default, the Bank shall have no responsibility or liability whatsoever to the Client in respect of any such information or advice from the Brokers or other third parties whether or not such advice was requested by the Client;
(e) the Bank shall not be responsible for any failure, delays, errors or inaccuracies in the transmission or communication of instructions due to the breakdown or failure of transmission or communication facilities or to any other cause or causes beyond its reasonable control including (without prejudice to the generality of the foregoing) government restrictions, contract market rulings or suspension of trading;
(f) the Bank shall not be liable to the Client for or in respect of any losses or failure to comply or delay in complying with its obligations under these terms and conditions which is caused directly or indirectly by force majeure, Act of God, war, terrorism, industrial disputes, natural disaster, adverse weather conditions, failure of communication systems or any other causes, event or circumstances beyond the Bank’s reasonable control;
(g) where instructions are given via the Dealing System, the Bank has no responsibility for any delay, failure, error, interruption or suspension in the transmission or communication of instructions or information on prices, or the mistaken receipt of any instructions by any other party;
(h) Brokers and Nominees are authorised to act upon any instructions received by them (regardless of any delay, error, interruption or suspension as aforesaid) and none of the Bank, the Brokers or the Nominees shall be liable for any losses or costs suffered or incurred by the Client as a result of the Brokers or the Nominees acting upon the same; and
(i) the Bank shall not be required to take any legal action unless fully indemnified to its reasonable satisfaction (as a prerequisite to taking such action) for all costs and liabilities by the Client.
24.3 The Client agrees to indemnify the Bank against all claims and liabilities arising, and all costs and expenses (including legal fees and costs on an indemnity basis) which are of reasonable amount and were reasonably incurred by the Bank, whether directly or indirectly, out of or in connection with:-
(a) the performance or exercise of their duties or discretions under these terms and conditions;
(b) arising out of or in connection with any breach by the Client of the obligations of the Client to the Bank or any Bank Affiliate; or
(c) any representation or warranty by the Client being or becoming untrue or inaccurate; or
(d) any costs incurred by the Bank or any Bank Affiliate in the collection (whether by it or any third party agent engaged by it for such purpose) of debts owed by the Client to the Bank or any Bank Affiliate; or
(e) as provided in clause 5.2.
The Client agrees to do such acts and things and to execute such documents as are necessary or are in the opinion of the Bank desirable to ratify or confirm anything done by the Bank in the proper exercise of any right or power conferred by these terms and conditions or any other agreement entered into pursuant to these terms and conditions or relating to the Securities Account, the Settlement Account or the Securities Services.
- Accuracy of Information
26.1 The Client represents and warrants to the Bank that all information provided by the Client from time to time in connection with the establishment and operation of the Securities Services (including without limitation information provided in the Application and changes there to notified by the Client) are true and accurate in every respect. The Client acknowledges that they constitute representations in reliance upon which instructions from the Client shall be accepted, and shall be treated as part of the agreement constituted by these terms and conditions. The Client shall notify the Bank forthwith of any material change in such information.
26.2 The Bank shall notify the Client of any material change in the information on the Bank provided hereunder.
- Joint Liability
27.1 In circumstances where two or more persons have jointly subscribed to the Securities Services by designation of the Securities Account and the Settlement Account together:-
(a) the Bank may act on the instructions of either person acting singly but each such person shall be jointly and severally liable with the other person for any obligation or liability incurred by either of them to the Bank in connection with the Securities Services, the Securities Account or the Settlement Account or otherwise under or in connection with these terms and conditions;
(b) upon the death of any person, any Securities, deeds and property of any description held in the joint names of the Client shall be held by the Bank to the order of the survivor or survivors of the Client subject to compliance with the provisions of the Estate Duty Ordinance, but without prejudice to the Bank’s rights in respect thereof arising out of any lien, charge, pledge, set-off, counterclaim or otherwise or to any step which the Bank may deem fit to take in view of any claim by any person other than such survivor or survivors; and
(c) the Bank shall be at liberty to release or discharge any of such persons from their liability hereunder or to accept any composition from or make other arrangements with any of such persons without releasing or discharging the other or others or otherwise prejudicing or affecting the rights and remedies of the Bank against the other or others, and none of them shall be released or discharged by the death of any one of them.
- Further Assurance
The Client hereby undertakes to the Bank to do and/or execute any act, deed, document or thing which the Bank shall require the Client to do in connection with the implementation, execution and enforcement of the agreement constituted by these terms and conditions, including without limitation the rights referred to in clause 21 and the Charge referred to in clause 22, and the Client hereby constitutes the Bank the lawful attorney of the Client to do or execute all such acts, deeds, documents or things on behalf of the Client as the Bank considers necessary or desirable in connection with such implementation, execution and enforcement.
- Compliance with Laws, etc.
29.1 The Client shall not instruct the Bank to do anything in relation to the Securities Services, the Settlement Account or the Securities Account which is a breach of or would involve or result in the Bank, any Bank Affiliate, the Broker, the Nominees or any other person being in breach of the Securities and Futures Ordinance, the Rules of the Exchange, the Codes on Takeovers and Mergers and Share Repurchases or any other laws, rules or regulations in force or applicable to the conduct of the business of dealing in securities in Hong Kong or elsewhere or otherwise binding on the Bank, any Bank Affiliate, the Brokers or the Nominees (whether or not having the force of law).
29.2 The Client acknowledges that he shall be solely responsible for compliance with all obligations of disclosure under the relevant provisions of Part XV of the Securities and Futures Ordinance, the Codes on Takeovers and Mergers and Share Repurchases, and any other applicable laws, rules or regulations relating to disclosure of interests in securities in Hong Kong or any other relevant countries / regions, each as amended from time to time. The Bank shall not be obliged to give notice of holdings to the Client in any form or by any time limit for such purpose save any notice or statement to be issued as expressly set out in these terms and conditions. The Client acknowledges that neither the Bank nor any Bank Affiliate, their respective directors, officers or employees shall be liable for any loss, cost or expense of the Client from any failure or delay by the Client or any other person to disclose in accordance with any such obligation nor any delay or default in notification to the Client as to the carrying into effect of instructions and shall indemnify the Bank for any loss, cost or expense arising from any such failure.
29.3 The Client undertakes to the Bank that the Client will not engage or attempt to engage, and that the Client has proper safeguards in place to prevent the Client from engaging, in any activity which may constitute market misconduct under the Securities and Futures Ordinance and further agrees to inform the Bank immediately if the Client becomes aware of any activity by any person that may result in the Client being involved in market misconduct.
29.4 Due to money laundering or other requirements operating within the relevant jurisdiction, the Bank may require identification documentation or other information before the Client is entitled to enter into any transaction or before the Bank provides the Client with the Securities Services. The Client acknowledges that it may be so required and undertakes to provide the Bank promptly with information or documentation as so requested.
30.1 The Client agrees that all personal data relating to the Client collected by the Bank from time to time may be used and disclosed for such purposes and to such persons (whether in or outside Hong Kong) as may be in accordance with the Bank’s policies on use and disclosure of personal data set out in statements, circulars, terms and conditions or notices made available by the Bank to its clients from time to time and such data may be (a) used in connection with matching procedures (as defined in the Personal Data (Privacy) Ordinance), and (b) disclosed (by way of bank references or otherwise) to any financial institution with which the Client has or proposes to have dealings to enable such financial institution to conduct credit checks on the Client; and (c) disclosed by the Bank in the event that such disclosure is required by any securities exchange or regulatory or governmental body having jurisdiction over it (including without limitation the Exchange and the Securities and Futures Commission) whether or not the requirement has the force of law.
30.2 Without limiting the Bank’s rights under clause 30.1, the Client authorises the Bank to disclose to the Brokers and the Nominees any information regarding the Client and the Client’s account relationship with the Bank, including without limitation the Client’s security access codes, balances on the Securities Account and the Settlement Account, any information provided in the Application and changes therein notified by the Client, and such other information as the Bank, the Brokers or the Nominees may deem necessary from time to time for the purposes of the Securities Services, the transmission, verification or execution of the Client’s instructions or any purpose ancillary thereto.
30.3 The Client’s information may be provided to a location which does not have the legal protection of information equivalent to Hong Kong. By accepting the Securities Services, the Client consents to the use of its confidential information in accordance with this clause.
- Representations by Client
31.1 By applying to the Bank for the provision of the Securities Services, the Client hereby represents and warrants to the Bank that:
(a) he is not a U.S. Person;
(b) he has not been nor does he anticipate or expect to be present in the United States for 183 or more days in aggregate during a calendar year;
(c) the gains from his subscription, purchase, sale or other transactions carried out pursuant to the Securities Services are not effectively connected or related to any U.S. Person or any US trade or business which the Client is engaged in or plans to engage in during the calendar year;
(d) the Securities are not being acquired or held beneficially by or for a U.S. Person, or in violation of any applicable law;
(e) unless he advises the Bank otherwise, no instructions given by the Client will be on behalf of a plan subject to the Employee Retirement Income Security Act of 1974 or any similar statute.
(f) he will not acquire or hold Securities beneficially by or for any other person, or in violation of any applicable law but he will be the beneficial owner of the Securities Account;
(g) he is the person(s) ultimately responsible for originating the transactions to be made on the Securities Account and no other person stands to gain the commercial or economic benefit or bear the commercial or economic risk thereof;
(h) he is fully aware of, and understands fully the market and the financial instruments being traded, in accordance with his instructions given pursuant to these terms and conditions, on the Exchange or any overseas stock exchange, and he is familiar with and understands all applicable laws, rules and regulations relating to his trading operations including (without limitation) those relating to insider dealing and other criminal offences. In particular, the Client represents and warrants that he is fully aware of the Rules of the Exchange, and will familiarise himself with and comply with all guidelines posted on the Exchange’s website (as amended from time to time).
(i) he acknowledges the Securities Services Risk Disclosure Statements set out in these terms and conditions and fully understands and accepts the risks (including the risk of loss) described thereunder;
(j) it is his decision to enter into any dealings in Securities (“Transactions”) and he fully understands the risks and consequences of his doing so and agree to bear all consequences of Transactions;
(k) he acknowledges that the Bank may require further information from him or a third party on his financial standing and investment objectives or to verify the same and agrees to provide the same on request;
(l) he has full power and authority to enter into these terms and conditions and to exercise the Client’s right and perform the Client’s obligations hereunder; and
(m) all the representations and warranties made by the Client remain true and accurate at all times.
- Authorisation for Credit Enquiry
The Client authorises the Bank and any Bank Affiliate to contact from time to time such credit reporting agencies, credit bureaus and other information sources (both in Hong Kong and overseas) as it deems necessary or desirable for the Bank to open and to maintain the Securities Account and request them to conduct a credit enquiry or check on the Client for the purpose of ascertaining the Client’s financial situation and investment objectives.
- Applicable Rules and Regulations
33.1 Every transaction in Securities made for or on behalf of the Client in Hong Kong or elsewhere and concluded through and recognized by the Exchange or any overseas stock exchange is subject to the relevant provisions of the constitutions, rules, regulations, bye-law, customs and usages of the Exchange or the relevant overseas stock exchange, HKSCC or the relevant overseas clearing agency and of the laws of Hong Kong or the jurisdiction in which the relevant overseas stock exchange is located, each as amended from time to time.
33.2 The rules of the Exchange and HKSCC or, as the case may be, the rules of the relevant overseas stock exchange and clearing agencies, in particular those rules relating to trading and settlement shall be binding on both the Bank and the Client in respect of transactions concluded on the Client’s instructions.
33.3 The Client acknowledges that, where required by the Exchange or any other regulatory authority, the Bank shall provide all relevant information concerning Client’s orders transmitted and/or executed by whatever means. The Client further acknowledges and agrees that it will co-operate fully and promptly with all requests by the Bank for the provision of any other information in the Client’s possession, custody or control which the Bank may be required to produce to the Exchange or any other regulatory authority.
- Investor Compensation Fund
In the event of a default (as defined in the Securities and Futures Ordinance) committed by the Bank, the Client is entitled to claim against the Investor Compensation Fund, as the same may be amended from time to time, established under the Securities and Futures Ordinance for pecuniary loss suffered by the Client thereby to the extent provided for in the Securities and Futures Ordinance. The Client acknowledges that the extent of such claim will be restricted as provided in the Securities and Futures Ordinance and there can be no assurance that any pecuniary loss sustained because of such default will be recouped from the Investor Compensation Fund in full, in part or at all.
- New Issues of Securities
In the event that the Client gives instructions to the Bank to apply for Securities in a new issue of Securities for listing on the Exchange, the Client:-
(a) authorises the Bank to make such application on behalf of the Client;
(b) warrants that such application is solely for the benefit of the Client;
(c) warrants that the application for Securities to be made by the Bank is and will be the only application made or intended to be made for the benefit of the Client and no other application will be made by the Client;
(d) authorises the Bank to represent and warrant to the Exchange (or other relevant stock exchange) on the application form that no other application is being made or is intended to be made by the Client itself or for the benefit of the Client by any other person;
(e) authorises the Bank to disclose that the application made by the Bank on the Client’s behalf is the only application made or intended to be made for the benefit of the Client or by or for the benefit of the Client;
(f) acknowledges that the representations, warranties and disclosure referred to above will be relied upon by the Bank in making the application and by the issuer of the Securities in deciding whether or not to allot Securities to the Bank on behalf of the Client;
(g) agrees to indemnify and hold harmless the Bank and its directors, employees and agents in full against any and all reasonable losses, damages, claims, liabilities, costs or expenses arising out of or in connection with any breach of the warranties given in this clause 35 or any authorisation being incorrectly given.
- Event of Default
36.1 Any one of the following events shall constitute an event of default (“Event of Default”):-
(a) any liabilities becomes overdue;
(b) the Client’s failure to pay any purchase price of Securities or other payments under these terms and conditions when due;
(c) the filing of a petition in bankruptcy, or the commence-ment of other analogous proceedings against the Client and in the case where there are two or more persons as the Client any such filing, or proceedings in respect of or against any one of them;
(d) any attachment, execution or similar process is levied against an Account;
(e) default by the Client in the due performance or observance of any of these terms and conditions;
(f) any representation or warranty made in these terms and conditions or in any document delivered to the Bank pursuant to these terms and conditions being or becoming incorrect;
(g) any consent or authorisation required by the Client to open an Account in accordance with these terms and conditions being wholly or partly revoked, suspended, terminated or ceasing to remain in full force and effect; or
(h) the occurrence of any event which, in the sole opinion of the Bank, might jeopardise any of the rights of the Bank or any Bank Affiliate under these terms and conditions.
36.2 If an Event of Default occurs, the Bank may at its sole discretion:
(a) cancel any or all outstanding orders or any other commitments made on behalf of the Client;
(b) close any or all contracts between the Bank and/or any Bank Affiliate and the Client;
(c) cover any short position with the Bank through the purchase of Securities on an exchange or liquidate any long position with the Bank through the sale of Securities on an exchange;
(d) call upon any securities which may have been issued in favour of the Bank and/or any Bank Affiliate as security for the obligations of the Client in respect of an Account;
(e) exercise any right of set-off or combination of Accounts conferred by these terms and conditions or otherwise; and/or
(f) immediately close the relevant Account(s).
36.3 Any determination of whether an Event of Default has occurred shall be made by using reasonable judgement. The Client undertakes to notify the Bank immediately in writing of the occurrence of any such event which shall constitute an Event of Default (although any failure to so notify the Bank will not prevent an Event of Default from having occurred).
- Termination and Suspension
37.1 The agreement set out in these terms and conditions may be terminated at the Bank’s sole discretion or may be cancelled by the Client in writing at any time. The Bank shall not terminate the Client’s account without first giving reasonable notice. Any such termination shall not affect any right or liability in respect of services provided by the Bank, transactions already effected by the Bank or any instruction given by the Client under these terms and conditions. These terms and conditions will continue to apply until all services, accounts and transactions have been closed or completed and the outstanding amounts and liabilities have been paid in full.
37.2 The agreement set out in these terms and conditions shall forthwith terminate upon the death or upon a legally recognised declaration of incapacity or incapability of the Client but all acts performed by the Bank, the Brokers and/or the Nominees prior to receiving written notice of such death, incapacity, incapability, shall be valid and binding upon the Client and the successors in title or permitted assigns of the Client.
37.3 Where the Client consists of more than one person, and one of the events described under clause 37.2 occurs in respect of one of those persons (the “Affected Person”), from the time of the occurrence of such event the Client shall consist of the other persons previously constituting the Client prior to such event. The Affected Person shall remain liable as part of the Client under these terms and conditions in respect of Liabilities incurred up to the occurrence of the relevant event.
37.4 The Bank may at any time by giving notice to the Client and without disclosing any reason therefor, suspend the services provided pursuant to these terms and conditions and the operation of the Securities Account until further notice.
37.5 Without prejudice to the generality of clause 37.1, the Bank may in its absolute discretion close the Securities Account if there is a zero balance on the Securities Account for such period as the Bank may determine from time to time.
- Procedures on Closure of the Accounts
38.1 Upon termination of these terms and conditions pursuant to clause 37 the Bank will close the Account in accordance with the standard procedures as may be adopted by the Bank from time to time.
38.2 These terms and conditions shall apply until all Securities have been transferred from the Securities Account, all sums due to the Client and all obligations of the Client to the Bank fulfilled.
38.3 On termination by either party, the Bank shall be entitled to receive from the Client all fees, costs, charges, expenses and liabilities accrued or incurred under these terms and conditions up to the date of termination including any additional expenses or losses reasonably and properly incurred in terminating these terms and conditions.
39.1 Any Communications or notices required or permitted to be given by or on behalf of the Bank to the Client may be given in writing and sent by mail (postage prepaid) or facsimile addressed to the Client at the last mailing address or facsimile number on record with the Bank. 39.2 All Communication and documents so sent under clause 39.1 shall be deemed to have been received by the recipient:
(a) if sent by letter: 24 hours after posting if mailed to an address in Hong Kong, or 7 days after posting if mailed to an address elsewhere, save that in the case of legal process these periods shall be increased to 7 and 21 days respectively; and
(b) if sent by facsimile: when dispatched.
39.3 Each of the other joint applicants (if any) irrevocably appoints the person named as “Primary Applicant” in the Application as his agent for the purpose of service by the Bank of such notices, demands or other communications as well as any legal process arising in connection with the agreement constituted by these terms and conditions or the Securities Services. Any notice to the “Primary Applicant” will be deemed effective notification to all joint applicants.
39.4 Any communication from the Client to the Bank shall be irrevocable and shall not be effective until actually received by the Bank at its designated address and/or in the designated manner.
- Governing Law and Submission to Jurisdiction
40.1 These terms and conditions shall be governed by and construed in accordance with the laws of Hong Kong.
40.2 The Client hereby:
(a) irrevocably submits to the non-exclusive jurisdiction of the courts of Hong Kong and of any country / region where the Client has assets now or in the future;
(b) waives any objections on the grounds of venue, forum non convenient or similar grounds; and
(c) consents to service of process including any writ, judgment or other notice by mail to the Client’s address on the Bank’s records or to such other address as may subsequently be notified in writing to, and received by, the Bank.
40.3 The Client hereby acknowledges that if any dispute or difference of any kind whatsoever shall arise between the Client and the Bank in connection with or arising out of these terms and conditions, then the Bank may refer such dispute or difference to arbitration in accordance with and subject to the provisions of the Arbitration Ordinance or any statutory modification thereof for the time being in force and any such reference shall be deemed to be a submission to arbitration within the meaning of such Ordinance.
- Securities eDocuments Service
41.1 Use of the Securities eDocuments Service
(a) In order to be eligible for using the Securities eDocuments Service, you must (a) be a holder of an Eligible Account or a person authorized to operate the Eligible Account (as the case may be); and (b) be registered with us to use the Securities eDocuments Service by returning to us a duly completed Securities eDocuments Service subscription form or by such other means as required or accepted by the Bank from time to time and taking all necessary steps that we may advise you to complete the registration process.
(b) Only the principal account holder is eligible for registration of the Securities eDocuments Service for the Securities Account. Upon your registration of the Securities eDocuments Service and verification and acceptance by the Bank, Securities eDocuments shall, be accessible by you for viewing, printing and downloading through Standard Chartered Online Banking provided that you have already registered for Standard Chartered Online Banking. We will no longer send you printed statements, documents or transaction records by post which will be replaced by the Securities eDocuments, save for certain Eligible Accounts as the Bank may be required or determined. If the registered Securities Account is a joint account, both holders of the joint account will be able to access to the Securities eDocuments.
(c) Securities eDocuments are accessible through Standard Chartered Online Banking and you must observe at all times the Client Terms when using the Securities eDocuments Service, a copy of which has already been provided to you and copy will be made available to you upon request. The Bank will only send you an electronic mail alert to the Designated Electronic Mail Account when the Securities eDocuments are available for access, view, print and download. You are advised and agree to check the Designated Electronic Mail Account regularly.
(d) You agree that your use, access and/or operation of the Securities eDocuments Service will constitute your agreement to and acceptance of these terms and conditions, the Client Terms as well as your acknowledgement of the inherent risks in accessing, viewing, printing and downloading the Securities eDocuments over the Internet.
(e) By agreeing to be bound by these terms and conditions, you agree that the Securities eDocuments Service will be made available to you on Eligible Accounts that you have with us as indicated on the Securities eDocuments Service subscription form or upon registration for Securities eDocuments Service by such other means and if instructed other Eligible Accounts that you may have with us in the future.
(f) You agree that you are solely responsible for (a) ensuring that Your System is capable of accessing, viewing, printing and downloading the Securities eDocuments and (b) checking the Designated Electronic Mail Account and/or Standard Chartered Online Banking for the Securities eDocuments and/or electronic mails in relation to your use of the Securities eDocuments Service.
41.2 Client’s Responsibilities for Security
(a) You acknowledge that electronic mails sent by us are not encrypted; and the use of and transmission of information via electronic mail and/or the Internet cannot be guaranteed to be secure; and information transmitted may be susceptible to errors, Viruses, delay, interception, modification or amendment by unauthorised persons. You therefore agree to take all reasonably practicable measures to ensure that Your System is adequately secure and adopt and maintain the security procedures or measures stipulated or recommended by the Bank from time to time in relation to your use, access and/or operation of the Securities eDocuments Service.
(b) You must not allow anyone else to use, access and/or operate the Securities eDocuments Service on your behalf.
(c) You must never respond to a request purportedly from us to provide your account, security details or Personal Data by electronic mail as the Bank will never make such a request. For the avoidance of doubt, all website hyperlinks authorized by the Bank will be for information only and will not require the inputting of your account or security details or Personal Data. You agree to inform the Bank as soon as possible if any electronic mail or website hyperlink appears to be irregular.
(d) You must not leave Your System unattended while you are on-line or accessing the Securities eDocuments Service.
(e) When using, accessing and/or operating the Securities eDocuments Service, you must ensure that Your System is not connected to a local area network (or LAN) (such as an office environment) without first making sure there is cyber security, including but not limited to no one else being able to observe or copy, trace or track your access or obtain access to the Securities eDocuments Service on your behalf .
(f) You are required to keep all login IDs and/or passwords which you use for the Securities eDocuments Service secret at all times (including without limitation those for accessing the Designated Electronic Mail Account and/or the Tele-Electronic Banking Services). We shall not be liable for any loss and/or damage you sustain as a result of you sharing your login IDs and/or passwords with other persons or entities, or allowing other persons or entities to use the Securities eDocuments Service registered by you, or by reason of any unauthorised access to your Securities eDocuments Service.
(g) You are also required to check all Securities eDocuments for any unauthorised transactions. If you become aware of any unauthorised transaction on any of the Securities eDocuments, you shall notify the Bank as soon as reasonably practicable, but in any event no later than the stipulated applicable time period specified in the relevant Securities eDocuments for purposes of raising any query that you may have in connection with the transactions shown on the Securities eDocuments. For the avoidance of doubt, any applicable time periods within which you must notify us of any unauthorized transaction(s) shall begin on the statement date printed on the relevant Securities eDocuments regardless of when you access or open the Securities eDocuments.
(h) You are required to inform the Bank as soon as practicable upon any change in the Designated Electronic Mail Account. We shall not be liable for any loss and/or damage you sustain in connection with any delay or failure in identifying or discovering any unauthorised transactions for non-receipt of the Securities eDocument as a result of you failing to inform us of such change.
(i) You are advised to save an electronic copy of any Securities eDocuments that is made available on Standard Chartered Online Banking from time to time in Your System or your computer device or print a hard copy for future reference.
41.3 The Bank’s Liability for Your Loss or Damage
(a) In connection with our provision of the Securities eDocuments Service, we will take reasonably practicable steps to ensure that our systems are installed with adequate security designs and to control and manage the risks in operating the systems by taking into account any laws, rules, regulations, guidelines, circulars, codes of conduct and prevailing market practices which may be applicable to us from time to time.
(b) To the extent permitted by the laws of Hong Kong, we disclaim any implied representation or warranty (a) as to the title, fitness for a particular purpose, merchantability, accuracy, completeness or standard of quality of the Securities eDocuments Service; and (b) that the Securities eDocuments Service or your use thereof will be uninterrupted, error-free, virusfree, or reliable. Notwithstanding the foregoing, nothing in this Clause seeks to avoid liability for fraudulent misrepresentation.
(c) To the extent permitted by the laws of Hong Kong and without prejudice to Clauses 2.6 and 2.8, we will not be liable for any loss and damage to you as a result of making available to you the Securities eDocuments Service (including without limitation any indirect, consequential or special loss or damage) even if the Bank shall have been advised of the same unless such loss or damage is directly caused by our gross negligence or our wilful default. Examples of circumstances in which we will not be liable to you for loss or damage resulting to you through the use of the Securities eDocuments Service include (but are not limited to):
(i) any incompatibility between Your System and the Securities eDocuments Service for the purposes of using, accessing and/or operating the Securities eDocuments Service; and
(ii) any misuse of Your System by you or anyone else; and
(iii) any damage to or loss of data from any computer system (including without limitation Your System) or device with which you use, access and/or operate the Securities eDocuments Service suffered by you arising from your use of the Securities eDocuments Service; and
(iv) any access to information about you, the Eligible Accounts and/or Securities eDocuments which is obtained by a third party as a result of your using the Securities eDocuments Service; and
(V) any machine, system or communications breakdown, interruption, malfunction or failure; industrial dispute; failure or fault of any Internet or electronic mail service providers, telecommunications or any other service providers or operators, or their respective agents and subcontractors; or other circumstances that are beyond our control which leads to the delay in the delivery of the Securities eDocuments or delay in the delivery of any information and/or data made available under the Securities eDocuments Service, or disruption or suspension of the Securities eDocuments Service (whether partially or wholly), or to the non-receipt, interception of or unauthorised access to the Securities eDocuments or any information and/or data made available under the Securities eDocuments Service; and
(vi) any delay or failure to send, transmit, receive, confirm or acknowledge any electronic mail, SMS messages, security codes, passwords, or anything available under the Securities eDocuments Service, or any error or incompleteness of any information or data available under the Securities eDocuments Service; and
(vii) for any errors, Viruses, delay, inaccuracy, losses, damages whatsoever arising from or in connection with your use of the Securities eDocuments Service (including but not limited to any interception, modification or amendment, disruption, interruption, delay or inaccuracy of emails or Internet transmission or other communication equipment or facilities); and
(viii) any services through which you access the Securities eDocuments Service or by which you obtain a password or other security codes that are not controlled by us, or for any loss you may suffer as a result of you using such a service.
(d) Nothing contained in this Clause 3 shall restrict the Bank’s liability for death or personal injury resulting from any act, omission or negligence of the Bank or its officers, agents, employees or sub-contractors.
41.4 Your Liability towards the Bank
(a) You shall compensate and indemnify us for all losses, damages, costs or expenses (including legal and other professional advisors’ fees) which are of reasonable amount and reasonably incurred by us in connection with your breach and/or our enforcement against you of these terms and conditions.
(b) You will indemnify us and keep us indemnified against any consequences, claims, proceedings, losses, damages or expenses (including all legal costs on an indemnity basis) which are of reasonable amount whatsoever and howsoever caused (save and except any direct loss or damages caused by gross negligence or wilful misconduct on the part of us) that may arise to be reasonably incurred by us in providing the Securities eDocuments Service to you, whether or not arising from or in connection with and including but not limited to (a) your improper use of the Securities eDocuments Service; or (b) any damage to Your System (or other computer hardware, devices, facilities or software).
41.5 Termination of Securities eDocuments Service
(a) The Bank may, without any liability and disclosing any reason, suspend or terminate the Securities eDocuments Service rendered to you at its sole discretion forthwith upon giving you a written notice including without limitation by electronic mail to the Designated Electronic Mail Account.
(b) You may suspend or terminate the Securities eDocuments Service at any time by completing a form designated by us or by such other means as accepted or required by the Bank from time to time.
(c) Any termination or suspension of the Securities eDocuments Service is without prejudice to and shall not affect the liabilities and rights which have accrued between you and the Bank prior to the date of suspension or termination.
(d) All indemnities, restrictions and obligations on your part contained in these terms and conditions shall survive termination of the Securities eDocuments Service.
(a) The Bank reserves the right to amend, add or delete at any time these terms and conditions as well as the scope or features of the Securities eDocuments Service by giving reasonable prior notice in writing to you and such notice may be made in such manner and by such means of communication as the Bank shall deem fit, including, without limitation, use of direct mailing material, advertisement, website display or electronic communications such as electronic mail. You acknowledge and agree that you shall observe and comply with any such amendment, addition and/or deletion when using, accessing and/or operating the Securities eDocuments Service.
41.7 Personal Data
(a) The Personal Data collected by us in connection with the provision of the Securities eDocuments Service to you will be used by us for the purpose of performing our obligations under these terms and conditions and other purposes arising out of and in connection with our provision of the Securities eDocuments Service. You agree that all Personal Data relating to a person collected by the Bank from time to time may be used and disclosed for such purposes and to such persons (whether the recipient is located in Hong Kong or another country, or in a country / region that does not offer the same level of data protection in Hong Kong) in accordance with the Bank’s policies on use and disclosure of personal data. Such policies are set out in statements, circulars, terms and conditions or notices made available by the Bank to you from time to time. The collected data may be (i) used in connection with matching procedures (as defined in the Personal Data (Privacy) Ordinance), and (ii) disclosed (by way of bank references or otherwise) to any financial institution with which you have or propose to have dealings to enable such financial institution to conduct credit checks on you.
(a) You acknowledge that electronic mail is not a completely reliable or secure method of communication and you must not use it for sending us notices in connection with these terms and conditions as well as any other communication that is in its nature sensitive or confidential.
(b) Unless otherwise provided for herein, if we need to send you a notice, we will use the address you have most recently given us and on our records in connection with your bank accounts.
41.9 Validity of these Terms and Conditions
(a) Any part of these terms and conditions which is invalid for any reason in any jurisdiction shall be ineffective only to the extent of such invalidity, and shall not affect the validity of the remaining provisions hereof or the validity of such provision in any other jurisdiction.
(b) If any term of these terms and conditions is unenforceable against any Client, such non enforceability shall not in any way affect the enforceability of that term against other Clients.
(a) No forbearance, neglect or waiver by the Bank in the enforcement of any of these terms and conditions shall prejudice its rights thereafter to strictly enforce the same. A single exercise or partial exercise of any power or right by the Bank does not preclude further exercises of that power or right or the exercise of any other power or right.
(a) These terms and conditions are available in both English and Chinese versions. The English version shall prevail in the event of any discrepancy between the two versions.
41.12 Governing Law and Jurisdiction
(a) These terms and conditions are governed by the laws of Hong Kong. The parties agree to submit to the non-exclusive jurisdiction of the courts of Hong Kong.
(a) In these terms and conditions, the following words and phrases shall, unless the context otherwise requires, have the following meanings:
“Bank” / “we” / “us” / “our” means Standard Chartered Bank (Hong Kong) Limited and all other entities in the Standard Chartered Bank group in respect of which the Securities eDocuments Service will be available;
“Client” / “you” / “your” means any client of the Bank who has applied for subscription to the Securities eDocuments Service and whose application has been accepted by the Bank;
“Client Terms” means the terms and conditions entitled as such and a copy of is available at https://av.sc.com/hk/content/docs/client-terms.pdf;
“Designated Electronic Mail Account” means the electronic mail account specified by you on the Securities eDocuments Service subscription form or upon registration for Securities eDocuments Service by such other means and in the absence of such details, any electronic mail account you provided in connection with your use of the Bank’s services, or such other electronic mail account which you may designate to the Bank from time to time for purposes of receiving electronic mails in relation to your use of the Securities eDocuments Service , as the case may be;
“Eligible Account(s)” means the credit card account(s) held by the Client with the Bank and/or any other applicable accounts, including but not limited to savings, current, fixed deposit, loan or other accounts as determined by the Bank to be eligible for the Securities eDocuments Service;
“Securities eDocuments” means the Bank’s Securities Monthly Statements, Contract Notes, Corporate Action Advices and IPO Advices as determined by the Bank to be included from time to time showing the information in respect of the Eligible Accounts, or any similar documentation provided to the Client via electronic mean(s);
“Securities eDocuments Service” means the service to be provided by the Bank to the Client in accordance with these terms and conditions where Securities eDocuments may be accessed by the Client through the Bank’s website;
“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of China;
“Personal Data” refers to personal data as defined in the Personal Data (Privacy) Ordinance, Cap. 486 of the Laws of Hong Kong;
“Standard Chartered Online Banking” means the website and/or the internet platform for the provision of the Bank’s general online banking services;
“Viruses” means computer viruses or similar device or software including, without limitation, devices commonly known as software bombs, Trojan horses and worms; and
“Your System” means the equipment or device and software programs that are contained on such equipment or device used by you to use, access and/or operate the Securities eDocuments Service.
42.1 These terms and conditions supersede all prior agreements or arrangements between the Bank and the Client relating to the Bank effecting transactions in investments or holding investments for the Client and any such arrangements or agreements are hereby terminated and shall be of no further force and effect.
42.2 The Bank shall provide reasonable notice to the Client to amend or change any or all of these terms and conditions (subject to the provisions of clause 16.1 in the case of any revision to the level of fees and charges).
42.3 The Client may not vary, amend or supplement these terms and conditions without the prior written consent of the Bank.
42.4 The Bank may, in its absolute discretion, extend the services provided under these terms and conditions to cover securities listed or traded on any other stock exchange or market outside Hong Kong in which case the Bank may supplement these terms and conditions in accordance with clause 41.2.
42.5 If any of these terms and conditions is held or deemed to be void or unenforceable, the other terms will remain in full force and effect.
42.6 The authorised signatories for the Settlement Account shall be the authorised signatories for the Securities Account with the same limitation (if any) on signing authority, and the signature(s) of the Settlement Account shall be the Client’s specimen signature(s) for operating the Securities Account. The Bank may also act on instructions, in relation to such Securities Account and Settlement Account, confirmed by a signature that matches any specimen signature in our records about the Client, or otherwise in accordance with clause 2 or the Client Terms (in relation to the giving of instructions by telephone or via the Internet).
42.7 The failure of the Bank to exercise or delay in exercising a right or remedy provided by these terms and conditions or by law does not constitute a waiver of the right or remedy or prevent further exercise of the right or remedy or another right or remedy.
42.8 The Client may not assign, transfer, charge or otherwise dispose of rights or obligations in respect of the Account or pursuant to these terms and conditions without the prior written consent of the Bank.
42.9 The Bank may assign all or a part only of its rights and obligations under these terms and conditions without the prior consent of the Client.
Warning: THIS DOCUMENT CONTAINS A BRIEF SUMMARY OF SOME (AND NOT ALL) OF THE FEATURES AND RISK DISCLOSURES OF INVESTING AND TRADING IN ELIGIBLE SHANGHAI STOCK EXCHANGE-LISTED SECURITIES AND ELIGIBLE SHENZHEN STOCK EXCHANGELISTED SECURITIES (“CHINA CONNECT SECURITIES”) THROUGH SHANGHAI-HONG KONG STOCK CONNECT AND SHENZHEN-HONG KONG STOCK CONNECT (“CHINA CONNECT”*) AND IS NOT MEANT TO BE AN EXHAUSTIVE SUMMARY. IF YOU ARE IN ANY DOUBT ABOUT THE RISKS INVOLVED IN INVESTING AND TRADING IN CHINA CONNECT SECURITIES, YOU ARE ADVISED TO SEEK INDEPENDENT FINANCIAL, TAX, LEGAL OR OTHER PROFESSIONAL ADVICE. THE CONTENTS OF THIS DOCUMENT HAVE NOT BEEN REVIEWED BY ANY REGULATORY AUTHORITY.
Important Notes for Standard Chartered China Connect Securities Services
Before trading in any eligible China Connect Securities through Standard Chartered China Connect Securities Services, clients are reminded of the following important notes:
For HK stocks, your securities are held in the safe custody of Standard Chartered Bank (Hong Kong) Limited (the “Bank”) in the Central Clearing and Settlement System (“CCASS”) as a CCASS Participant for the account of the Bank. For Standard Chartered China Connect Securities Services, UBS Securities Hong Kong Limited has been appointed as the custodian for the A-Shares acquired through the Program. Your A-Shares will be held in a segregate account assigned to the Bank in the name of UBS Securities Hong Kong Limited in CCASS.
Cash Settlement Arrangement
Both stock and cash settlement for all A-Shares trades executed through the Bank will be settled on the Trading Day. The Bank will check against the designated RMB settlement account to ensure the necessary funding is in place before accepting a buy order. Funding for executed buy trades will be debited on the same trading day. Similarly, sales proceeds for executed sell trades will be credited to customer’s settlement account on the same day. The Bank reserves the absolute right to revise the cash settlement schedule by giving a reasonable notice of no less than 7 calendar days in the future.
Orders submitted before end of Opening Call Auction Session
All orders submitted before the end of Opening Call Auction Session (i.e. 9:25 a.m.) will be submitted as an auction limit order and participate in the Opening Call Auction.
Order Submission Time
To ensure sufficient time for routing orders to the Shanghai Stock Exchange, Shenzhen Stock Exchange, and/ or a stock market in the PRC acceptable to SEHK (“China Connect Market”), the last submission time for Shanghai A shares orders is before 14:59 , those for Shenzhen A shares is before 14:57 of each trading day.
Capital Gain Tax & Business Tax
The Ministry of Finance and State Administration of Taxation (“SAT”) in China have provided a temporary exemption to Hong Kong and foreign investors from the capital gain tax and business tax in relation to gains derived from trading of eligible China Connect Securities via China Connect. There is a risk that investors trading in China Connect Securities may be subject to capital gains tax and/ or business tax in the future once the temporary exemption is no longer in force. Investors should consider this risk when investing in China Connect Securities.
The Bank has provided a tax indemnity to a third party custodian in regards to China Connect Securities. There is a risk that the SAT will, in the future, require either the Bank or its custodian to make payment of your capital gains tax and/or business tax liability, on your behalf. In this event Standard Chartered will recover the amount paid on your behalf from you.
I. Key Risks for trading Eligible China Connect Securities via China Connect Service.
It is crucial to understand the specific terms and risks mentioned in the Additional Terms and Conditions for Standard Chartered China Connect Securities Services, this document and other relevant documents (e.g. product leaflet, Frequently Asked Questions published in the Bank’s website) (collectively referred to as “Product Documents”) before trading Eligible China Connect Securities.
Key risks include but are not limited to:
Not Protected By Investor Compensation Fund Hong Kong Investor Compensation Fund is established to pay compensation to investors who suffer pecuniary losses as a result of default of a licensed intermediary or authorized financial institution in relation to exchange-traded products in Hong Kong. According to the Securities and Futures Ordinance, the Investor Compensation Fund only covers products trading in Hong Kong’s recognized securities market (SEHK), i.e. investors should note that any Northbound trading under China Connect will NOT be covered by Hong Kong’s Investor Compensation Fund. Also, investors carrying out Northbound Trading through securities brokers in Hong Kong are NOT protected by the China Securities Investor Protection Fund neither.
Quotas used up
Once the daily quota of Northbound Trading of Shanghai – Hong Kong Stock Connect or Shenzhen – Hong Kong Stock Connect is used up, i.e. the daily quota balance of China Connect drops to zero or the daily quota is exceeded during a Continuous Auction session (or closing call auction for SZSE), acceptance of the corresponding buy orders will also be immediately suspended and no further buy orders will be accepted for the remainder of the day. Buying services will be resumed on the next trading day. Buy orders which have been accepted will not be affected by the using up of the daily quota, while sell orders will be continued to be accepted. If the daily quota is used up during the Opening Call Auction session, new buy orders will be rejected. However, as order cancellation is common during opening call auction, the Northbound Daily Quota Balance may resume to a positive level before the end of the opening call auction. When that happens, SEHK will again accept Northbound buy orders.
China Connect only operates on days when the relevant China Connect Market and Hong Kong stock markets are both open for trading and when banks in these markets are both open on the corresponding settlement days. So it is possible that there are occasions when it is a normal trading day for the China Connect Markets but Hong Kong investors cannot carry out A Share trading. Clients should take note of the days China Connect is open for business and decide according to their own risk tolerance capability whether or not to take on the risk of price fluctuations in A Shares during the time when China Connect is not operating.
No Day Trading
Clients should be aware that day trading is not allowed for China Connect Northbound Trading. Clients buying A Shares on Day T can only sell these acquired shares on or after Day T+1.
Restrictions on selling imposed by front-end monitoring
For investors who keep A Shares in financial institutions other than the Bank, if investors want to sell relevant A Shares through the Bank, they must first transfer the relevant A Shares to the Bank before market opens on the day of selling. Clients should allow at least 3 working days for the Bank to complete transfer request of A Shares from other financial institution to the Bank.
Recalling of eligible stocks
When a stock is recalled from the scope of eligible stocks for trading via China Connect, the stock can only be sold but restricted from being further bought. This may affect your investment portfolio or strategies. Clients should there pay close attention to the list of China Connect Securities as provided and renewed from time to time by Shanghai Stock Exchange (“SSE”), Shenzhen Stock Exchange (“SZSE”) and SEHK.
Client who holds a local currency other than RMB will be exposed to currency risk if he/ she invests in a RMB product due to the need for the conversion of the local currency into RMB. During the conversion, currency conversion costs will be incurred. Even if the price of the RMB asset remains the same, you may still incur a loss when you convert the sale proceeds back to the local currency if RMB depreciates.
Investing in the PRC, an emerging market, involves special considerations and risks, including but not limited to greater price volatility, less developed regulatory and legal framework, economic, and social and political instability.
The market value of China Connect Securities and the income from them may fluctuate. There can be no assurance that you will achieve profits or avoid losses from trading China Connect Securities, significant or otherwise. The return you receive from the China Connect Securities (if any) will fluctuate in response to changes in capital appreciation and/or income relating to such China Connect Securities. Furthermore, China Connect Securities may experience volatility and decline depending on market conditions. Through trading China Connect Securities, you are exposed to various forms of risk dependent on factors which are difficult to predict, including for example, interest rate risks (risks of falling China Connect Securities values in a rising interest rate market), income risks (risks of falling incomes from China Connect Securities in a falling interest rate market) and credit risk (risk of a default by an issuer of China Connect Securities).
Although China Connect Securities are listed for trading on the China Connect Markets and available for trading through SEHK by China Connect Services, there can be no assurance that an active trading market for China Connect Securities will develop or be maintained. If spreads on China Connect Securities are wide, this may adversely affect your ability to dispose of China Connect Securities at the desired price. If you need to sell China Connect Securities at a time when no active market for them exists, the price you receive for your China Connect Securities — assuming you are able to sell them — is likely to be lower than the price received if an active market did exist.
Whether an issuer of China Connect Securities will pay distributions is subject to such underlying issuer’s dividend policy. Dividend payment rates in respect of China Connect Securities may depend on factors including general economic conditions and the financial positions of the relevant issuers. There can be no assurance that any dividends or distributions in respect of China Connect Securities will be declared or paid.
Possible Business Failure Risk
In the current economic environment, global markets are experiencing very high level of volatility and an increased risk of corporate failures. The insolvency or other corporate failures of any issuer of China Connect Securities may have an adverse effect on your investment. You may lose money by investing in China Connect Securities.
Additional Tax Indemnity
By trading in any China Connect Markets listed security you agree that:
(i) Any taxes, duties, charges, withholdings or declarations which arise or are imposed in respect of investing in or trading China Connect Securities (including but not limited to capital gains tax from gain arising from China Connect Securities) (“Taxes”) may be deducted or withheld by the Bank from all payments payable to you under China Connect Securities or otherwise under your existing accounts. Taxes shall include, but shall not be limited to, taxes arising from time to time under the laws of China including taxes, duties and similar charges, taxes withheld or deducted from gains arising from such China Connect Securities and other amounts withheld by any issuer from distributions made by such issuer, its agents or any relevant agent or authority and / or any clearing or custodian agent authorized by the relevant authority.
(ii) You acknowledge that the Bank may only be able to determine the portion of Taxes attributable to any China Connect Securities following the redemption, exercise, resale, unwind or termination of the China Connect Securities or following repatriation of the sale proceeds attributable to such China Connect Securities, when the relevant authority imposes such Taxes, including if such Taxes are imposed retroactively. You agree to pay to the Bank or its agent upon each and any demand, such portion of the Taxes as the Bank or its agent determines in a commercially reasonable manner are attributable to the China Connect Securities.
(iii) You agree to indemnify and hold harmless the Bank and its affiliates and their respective officers, directors, employees, advisors, agents and controlling persons (each an “Indemnified Person”) from and against any and all losses, claims, damages, judgments, liabilities and expenses, including attorneys’ fees and expenses (including the cost of any investigation and preparation), whether joint or joint and several, when and as reasonably incurred by such Indemnified Person, resulting from or arising out of the Taxes or related to breach of any representation, warranty or agreement made by you.
(iv) You agree that Standard Chartered is not responsible for handling tax treaty claim on your half.
Retention of Information
You acknowledge and accept that the Bank will be required under the Applicable Regulations to keep records for a period of not less than 20 years of the following in respect of China Connect Securities (a) all orders and trades executed on your behalf; (b) any instructions received from you; and (c) your account information. ‘Applicable Regulations’ means laws, regulations, rules and guidelines of Hong Kong and the People’s Republic of China (‘PRC’) as may be amended from time to time (including but not limited to filing and registration obligations and those relating to disclosure of interest, “short swing profit rule”, foreign ownership limits).
General Legal and Regulatory Risk
You must comply with all Applicable Regulations. Furthermore, any change in any Applicable Regulations may have an impact on the market sentiment which may in turn affect the performance of China Connect Securities. It is impossible to predict whether such an impact caused by any such change will be positive or negative for China Connect Securities. In the worst case scenario, you may lose a material part of your investments in China Connect Securities.
Ownership of China Connect Securities
(i) China Connect Securities are held in China Securities Depository and Clearing Corporation Limited (“ChinaClear”). Hong Kong Securities and Clearing Company Limited (“HKSCC”) will become a direct participant in ChinaClear and China Connect Securities acquired by investors through the China Connect Services will be:
a. recorded in the name of HKSCC in the nominee securities account opened by HKSCC with ChinaClear and HKSCC will be nominee holder of such China Connect Securities; and
b. held in custody under the depository of ChinaClear and registered in the shareholders’ register of the listed companies on the China Connect Markets.
(ii) HKSCC will record interests in such China Connect Securities in the CCASS stock account of the relevant CCASS Clearing Participant (as defined in the SEHK rules).
(iii) Under Hong Kong law, HKSCC will be regarded as the legal owner of such China Connect Securities and will be regarded as holding its beneficial entitlement to the China Connect Securities on behalf of the relevant CCASS Clearing Participant. Depending on the custody arrangements between such CCASS Clearing Participant and its clients, such CCASS Clearing Participant will in turn generally be regarded as holding its beneficial entitlement for such clients.
(iv) Under current PRC regulations, the China Connect Securities will be recorded in a nominee account opened by HKSCC with ChinaClear and China Connect Securities investors have rights and interests in China Connect Securities acquired through China Connect Services according to the applicable laws. The China Securities Regulatory Commission (“CSRC”) Securities Registration and Settlement Measures, ChinaClear Securities Registration Rules and Administrative Rules on Securities Accounts, the ChinaClear China Connect Rules, SSE China Connect Rules and SZSE China Connect Rules generally provide for the concept of a “nominee holder” and recognise the China Connect Securities investors as the “ultimate owners” of the China Connect Securities.
(v) China Connect Securities investors shall exercise their rights in relation to China Connect Securities through HKSCC as the nominee holder. As China Connect Securities investors will have actual control over voting rights in respect of such China Connect Securities (either individually or acting in concert with others), China Connect Securities investors are responsible for complying with disclosure obligations under PRC laws and regulations in relation to the China Connect Securities acquired through China Connect Securities trading.
(vi) After the launch of the Shanghai Hong Kong Stock Connect, and concurrent with the promulgation of the expanded and revised China Connect rules, CSRC issued two FAQs respectively on 15 May 2015 and 30 September 2016, which provided regulatory clarification and affirmation that HKSCC is the nominee holder for China Connect Securities, and Hong Kong and overseas investors shall enjoy property rights as the holder and shall exercise their rights in relation to China Connect Securities as proprietary owners through HKSCC.
(vii) SEHK has also published materials explaining the ownership rights of China Connect Securities investors in China Connect Securities and may publish further information from time to time. In summary, the SEHK published materials state that:
a. it is the China Connect Securities investors as the ultimate investors (rather than any broker, custodian or intermediary through whom such investors hold the China Connect Securities) who should be recognised under PRC laws and regulations as having beneficial ownership in the China Connect Securities;
b. as key functions of a nominee holder, HKSCC will be responsible for collecting and distributing dividends to its participants (for their own account and/or as agent for their investors) and obtaining and consolidating voting instructions from its participants and submitting a combined single voting instruction to the issuer of the relevant China Connect Securities. Under the CCASS China Connect Rules, HKSCC is prepared to provide assistance to the beneficial owners of China Connect Securities where necessary. Hong Kong Exchanges and Clearing Limited (“HKEx”) notes that any beneficial owner who decides to take legal action is responsible for seeking its own independent legal advice to satisfy itself and HKSCC that a cause of action exists and the beneficial owner should be prepared to conduct the action and take up all costs in relation to the action, including providing HKSCC with indemnities and legal representation in proceedings. Further details are set out in the HKEx published materials; and
c. on the insolvency of HKSCC, the China Connect Securities will not be regarded as the general assets of HKSCC under Hong Kong and PRC law and will not be available to the general creditors of HKSCC. ChinaClear and the PRC courts will recognise the liquidator of HKSCC, duly appointed pursuant to Hong Kong law, as the rightful person to deal with China Connect Securities in the place of HKSCC.
You should conduct your own review of the HKEx published materials and the Applicable Regulations from time to time. You should also consult your own legal advisers to make your own assessment of your rights as an investor in China Connect Securities.
II. Additional Terms and Conditions for Standard Chartered China Connect Securities Services
These terms and conditions set out the rights and obligations of you in connection with your use of China Connect Services. All these terms and conditions are legally binding, so please read them through carefully before you agree to be bound by them. You hereby acknowledge and accept that there are material risks in trading via the China Connect Services and holding of China Connect Securities and confirm that you are prepared to accept all risks on trading China Connect Securities.
1.1 In the event of any conflict or discrepancy between these terms and conditions and (a) the Terms and Conditions for Securities Services or (b) the terms of any other agreement subsisting from time to time between the Bank and the Client or (c) the terms of any agreement between such Client and any other Bank Affiliate in respect of dealings in Securities, these terms and conditions shall prevail. For the avoidance of doubt, the Client Terms shall apply in relation to the giving of instructions by telephone or via the Internet.
1.2 The English version shall prevail in the event of any inconsistency between the English and Chinese versions.
1.3 In these Terms and Conditions and Risk Disclosure:
“A Shares” means any securities issued by companies incorporated in the PRC which are listed and traded on any PRC A Share market (i.e. the Shanghai Stock Exchange or the Shenzhen Stock Exchange) and not on SEHK.
“Applicable Regulations” means laws, regulations, rules and guidelines of Hong Kong and the People’s Republic of China (‘PRC’) as may be amended from time to time (including but not limited to filing and registration obligations and those relating to disclosure of interest, “short swing profit rule”, foreign ownership limits).
“Authorities” means SEHK, SSE, SZSE or other exchanges, clearing systems or regulators.
“Authority” means any one of them.
“CCASS” means Central Clearing and Settlement System operated by HKSCC.
“China Connect” refers to the Shanghai – Hong Kong Stock Connect, the Shenzhen – Hong Kong Stock Connect and/ or any other securities trading and clearing links programme developed or to be developed by SEHK, the relevant China Connect Market(s), HKSCC and ChinaClear for the establishment of mutual market access between SEHK and the revelant China Connect Market(s) (as the case may be).
“China Connect Clearing House” means a clearing house in Mainland China acceptable to Hong Kong Securities Clearing Company (“HKSCC”) and included in the list of China Connect Clearing Houses from time to time, as referred to in Rule 4105(b) under Central Clearing and Settlement System (“CCASS”) General Rules.
“China Connect Market” means SSE, SZSE, and/ or a stock market in the PRC acceptable to SEHK and included in the list of China Connect Markets which are eligible for China Connect trading (as the case may be).
“China Connect Market Operator” refers to any institutes operating in China Connect Market System for trading of China Connect Securities under China Connect, including but not limited to Shanghai Stock Exchange and Shenzhen Stock Exchange.
“China Connect Order” means an order input into the CSC via a China 2 Connect Open Gateway or via a China Connect Central Gateway session of a China Connect Exchange Participant for routing to a China Connect Market System to buy or sell China Connect Securities (including an order to sell Special China Connect Securities), and the terms “China Connect buy order” and “China Connect sell order” shall be construed accordingly.
“China Connect Rules” means any laws, rules, regulations, policies or guidelines published or applied by any Authority from time to time in respect of China Connect or any activities arising from China Connect. “China Connect Securities” means securities listed and traded on the China Connect Markets that orders for buying and/ or selling these securities shall be placed via the China Connect Services. The list of China Connect Securities and its admission criteria can be revised by SEHK from time to time.
“China Connect Service” means the order-routing service through which Northbound orders placed by certain Exchange Participant may be transmitted by an SEHK Subsidiary to the corresponding China Connect Market for the buying and selling of China Connect Securities and any related supporting services.
“China Connect Market System” means a system for trading of China Connect Securities under China Connect, i.e. (a) SSE Securities on SSE, as operated by SSE, (b) SZSE Securities on SZSE as operated by SZSE (as the case may be) and/or (c) China Connect Securities on the relevant China Connect Market, as operated by the relevant exchange that operates such China Connect Market and has entered into trading links with SEHK.
“ChinaClear” means China Securities Depository and Clearing Corporation Limited.
“ChiNext Shares” mean shares accepted for listing and admitted to trading on the ChiNext market operated by SZSE which are accepted as China Connect Securities, unless such ChiNext Shares were received by an investor as a result of any distribution of rights or entitlements, conversion, takeover, other corporate actions or special circumstances arising from China Connect Securities.
“CSRC” means China Securities Regulatory Commission.
“Exchange Participant” means (a) any broker, appointed by the Bank, which is a person registered as a China Connect Exchange Participant (as defined in the SEHK China Connect Rules) by SEHK; or (b) where the context requires, any China Connect Exchange Participant (as defined in the SEHK China Connect Rules).
“HKEx” means the Hong Kong Exchanges and Clearing Limited.
“HKSCC” means the Hong Kong Securities and Clearing Company Limited.
“SEHK” means the Stock Exchange of Hong Kong Limited.
“SEHK Subsidiaries” means a wholly-owned subsidiary of SEHK duly authorised as an automated trading service provider under the Securities and Futures Ordinance and licensed under applicable laws in Mainland China to provide order-routing service under China Connect.
“Shanghai – Hong Kong Stock Connect” is a securities trading and clearing links programme developed by SEHK, SSE, HKSCC and ChinaClear for the establishment of mutual market access between Hong Kong and Shanghai.
“Shanghai – Hong Kong Stock Connect Services” refers to the order-routing service provided by the Bank, such that orders for buying and selling certain securities listed and traded on the Shanghai Stock Exchange can be placed by you and routed to the Shanghai Stock Exchange by the Bank’s appointed execution broker.
“Shenzhen – Hong Kong Stock Connect” is a securities trading and clearing links programme developed by SEHK, SZSE, HKSCC and ChinaClear for the establishment of mutual market access between Hong Kong and Shenzhen.
“Shenzhen – Hong Kong Stock Connect Services” refers to the order-routing service provided by the Bank, such that orders for buying and selling certain securities listed and traded on the Shenzhen Stock Exchange can be placed by you and routed to the Shenzhen Stock Exchange by the Bank’s appointed execution broker.
“SSE” means the Shanghai Stock Exchange.
“Standard Chartered China Connect Securities Services” refers to the services provided by the Bank to the client who may trade China Connect Securities pursuant to the China Connect Rules and relevant banking terms and conditions of the Bank.
“SZSE” means the Shenzhen Stock Exchange.
- Trade Settlement and Settlement Instructions
2.1 With respect to a BUY order:
i. Before placing a BUY order, you are required to ensure you have the sufficient Renminbi to deliver to the Bank upon settlement;
ii. You authorize the Bank to debit the funding required to settle your Buy trades from your settlement account on trade day (“T”);
iii. You acknowledge and agree that if for any reason the Bank does not receive by T all or any part of the China Connect Securities bought on your behalf on T, released from HKSCC or the Bank’s execution broker and custodian, the Bank shall only deliver to you on T the quantity of the China Connect Securities actually received by the Bank on T from HKSCC, the Bank’s execution broker and custodian.
2.2 With respect to a SELL order:
i. Before placing a SELL order, you are required to ensure you have the sufficient China Connect Securities to deliver to the Bank upon settlement;
ii. The Bank will credit the sales proceeds to your settlement account on trade day (“T”) upon receipt of the relevant sales proceeds from the Bank’s execution broker.
- Trading Restrictions
Client agrees to fully comply with and be bounded with the trading restrictions, including but not limited to the following, imposed by China Connect Markets, SEHK, the Bank and its execution broker from time to time:
(a) Client may only place limit orders to trade Eligible China Connect Securities. Limit orders placed before the end of Opening Call Auction session will be submitted to China Connect Markets and participate in the Opening Call Auction. Client should note that China Connect Markets limit orders are different from SEHK limit orders and can be matched at the specified price or a better price, whereas SEHK limit orders can only be matched at the specified price.
(b) Orders for Eligible China Connect Securities are subject to price limits prescribed by Authorities and the price limits may be changed from time to time without prior notice. All orders in respect of China Connect Securities must be within the prescribed price limits or else such orders will be rejected by the Bank, its execution broker or China Connect Markets.
(c) Orders for China Connect Securities are subject to Daily Quota as announced by the Authorities from time to time. You acknowledge that your China Connect Securities orders may be rejected by SEHK, the Bank or its execution broker if such Daily Quota is fully utilized as determined and announced by SEHK.
(d) China connect Markets do not accept amendments of orders. Client acknowledges that for order amendment, the outstanding order must first be cancelled followed by a new order placement to China Connect Markets if Client modifies an outstanding China Connect Securities order. Order priority will be lost and the new order will be subject to the Daily Quota balance restrictions at the time the new order is placed.
(e) Situations exist under which Eligible China Connect Securities may be restricted from trading, e.g. China Connect Securities under “risk alert” or its corresponding H shares are suspended from trading on the relevant China Connect Market. Any change to the risk alert board of China Connect Markets or suspension or restriction from trading may occur without prior notice. If a China Connect security which is eligible for China Connect Services trading is subsequently suspended or restricted from trading through China Connect Services, Clients may only be allowed to sell the relevant China Connect security under China Connect Services and may be restricted from further buying of such China Connect Market security.
(f) No day trading is allowed. For China Connect Securities that you have purchased, you may not sell such China Connect Securities before the purchase transaction of such China Connect Securities has been settled. Settlement shall be effected when the on hold status has been released in accordance with the Operational Procedures set by SEHK.
(g) Should Client places an order with order quantity exceeding the maximum limit imposed by China Connect Markets, the Bank or its execution broker would split up the order into multiple child-orders in a manner that will comply with the relevant limit and send the childorders to China Connect Markets.
(h) Buy orders involving odd lots through China Connect Services are not permitted. Sale of odd lots through China Connect Services is allowed provided that such order relates to the sale of all and not part of the odd lots held by the Client.
(i) Under applicable regulations, the “short swing profit rule” requires an investor to return any profits made from purchases and sales in respect of shares of a PRC company listed on a PRC stock exchange if:
a. the client’s shareholding in the PRC listed company exceeds the single foreign investor threshold prescribed by the relevant Authority from time to time; and
b. the corresponding transaction occurs within six months after a purchase transaction or vice versa, Client acknowledges that Client shall, and it is the Client’s responsibility to, comply with such “short swing profit rule”.
(j) Trading of ChiNext Shares through the China Connect Services are restricted to ‘professional investors” within the meaning of paragraph (a), (b), (c), (d), (e), (f), (g), (h) or (i) of the definition of ‘professional investor’ in section 1 of Part 1 of Schedule 1 to the Securities and Futures Ordinance (Cap.571) (‘SFO’) and unless the context otherwise requires, any subsidiary legislation made thereunder (‘Institutional Professional Investor’). Violation on this would lead to unwind the position and face disciplinary action.
- Foreign Shareholding Restrictions
(i) Under applicable regulations, there is a limit to how many shares a single foreign investor is permitted to hold in a PRC listed company, and also a limit to the maximum combined holdings of all foreign investors in a single PRC listed company. It is your responsibility to comply with such limit. Such foreign ownership limits may be applied on an aggregate basis (i.e. across both domestically and overseas issued shares of the same listed company, whether the relevant holdings are through Shanghai-Hong Kong Stock Connect, the Qualified Foreign Institutional Investors (“QFII”) regime, the RMB Qualified Foreign Institutional Investors (“RQFII”) regime or other investment channels)
(ii) If the aggregate foreign shareholding of an A Share reaches 28%, SEHK will not accept any further purchase orders until the shareholding reduces to 26%.
(iii) If the aggregate foreign shareholding of an A Share reaches 30%, SEHK will identify the relevant exchange participant(s) (on a Last-In-First-Out basis) and require such exchange participant(s) to sell such A Shares within a time specified by SEHK. In such a situation, the Bank, its execution broker and/ or custodian may be required by the Authorities to sell your holdings in the relevant China Connect Securities. You acknowledge that the Bank shall not be liable for, any losses suffered or costs incurred by you and undertake to indemnify the Bank and to hold the Bank harmless from and against, any cost incurred by the Bank as a result of the Bank, its execution broker and / or custodian acting upon the instruction by the Authorities.
(iv) It shall be Client’s responsibility to comply with any disclosure of interest rules from time to time imposed by the relevant Authorities and arrange for any relevant filings.
- Corporate Actions
(i) Following existing market practice in the PRC, investors engaged in the trading of A-Shares will not be able to attend meetings by proxy or in person, unlike the current practice in Hong Kong in respect of SEHK-listed shares.
(ii) Since the distribution proceeds received by the Bank from CCASS in relation to corporate action entitled by Clients are after tax deduction, unless otherwise specified, the distribution rate specified in the correspondence issued by the Bank for corporate action events is after tax deduction.
(iii) The Bank does not and cannot ensure the accuracy, reliability or timeliness of any company announcements of corporate actions and the Bank accepts no liability (whether in tort or contract or otherwise) for any loss or damage arising from any errors, inaccuracies, delays or omissions or any actions taken in reliance thereon. The Bank expressly disclaims all warranties, expressed or implied, as to the accuracy of any company announcement or as to the fitness of the information for any purpose.
(iv) Any corporate action in respect of China Connect Securities will be announced by the relevant issuer through China Connect Markets website and the channel as officially approved by the Authority. You should note that issuers that are listed on the China Connect Markets may publish such corporate action documents in Simplified Chinese only, and documents in Traditional Chinese or English may not be available, and the Bank has no responsibility to produce such translation for its clients.
- Investor Protection
(i) Trading in A Shares does not enjoy the protection afforded by the Investor Compensation Fund established under the Securities and Futures Ordinance. Accordingly, unlike the trading of SEHK listed securities, clients will not be covered by the Investor Compensation Fund in respect of any loss clients may sustain by reason of a default by persons licensed by or registered with the Securities and Futures Commission of Hong Kong.
(ii) As the A Shares are not listed or traded on the SEHK, clients will not have protection under the Securities and Futures (Client Securities) Rules, unless otherwise specified by an Authority. As a result, clients engaging in Northbound Trading under China Connect do not have protection under the SFO and related subsidiary legislation.
(iii) ChinaClear has established a risk management framework and measures that are approved and supervised by the China Securities Regulatory Commission (“CSRC”). If ChinaClear (as the host central counterparty) defaults, HKSCC may (but shall have no obligation) to take any legal action or court proceeding to seek recovery of the outstanding A Shares and monies from ChinaClear through available legal channels and through ChinaClear’s liquidation process, if applicable. As ChinaClear does not contribute to the HKSCC guarantee fund, HKSCC will not use the HKSCC guarantee fund to cover any residual loss as a result of closing out any of ChinaClear’s positions. HKSCC will in turn distribute the A Shares and/or monies recovered to clearing participants on a pro-rata basis as prescribed by the relevant Authorities. The Bank, in turn, will only be distributing the A Shares and/or monies to the extent recovered directly or indirectly from HKSCC. Although the likelihood of a default by ChinaClear is considered to be remote, investors should be aware of this arrangement and of this potential exposure before engaging in Northbound Trading.
(i) SEHK may disclose your information (including any personal data) without the Bank’s prior approval to SEHK’s affiliates and relevant Authorities, including but without limitation for surveillance or investigation purposes.
(ii) In order to comply with Applicable Regulations (including but not limited to requirements to conduct pre-trade checks and settlement of China Connect Securities trades in Renminbi), the Bank may disclose its clients’ China Connect Securities data for use in compliance with Applicable Regulations.
- Personal Information Collection Statement concerning China Connect Orders
Processing of Personal Data as part of the China Connect Securities Services
You acknowledge and agree that in Standard Chartered Bank (Hong Kong) Limited (the “Bank”), its service providers and its execution broker (collectively as “we” or “us”) providing China Connect Securities Services (“Services”) to you, we will be required to:
(i) tag each of your orders submitted to the trading system with a Broker-to-Client Assigned Number (“BCAN”) that is unique to you or the BCAN that is assigned to your joint account with the bank, as appropriate; and
(ii) provide to the Stock Exchange of Hong Kong (“SEHK”) your assigned BCAN and such identification information of you (“Client Identification Data” or “CID”), including your name in English and Chinese (if applicable and available), Identity Document (“ID”) issuing country / region, ID type and ID number relating to you, as SEHK may request from time to time under the Rules of the Exchange.
Without limitation to any notification we have given you or consent we have obtained from you in respect of the processing of your personal data in connection with your account and our services to you, you acknowledge and agree that we may collect, store, use, disclose and transfer personal data relating to you as required as part of our Services, including as follows:
(a) to disclose and transfer your BCAN and CID to the Exchange and the relevant SEHK Subsidiaries from time to time, including by indicating your BCAN when inputting a China Connect Order into the trading system, which will be further routed to the relevant China Connect Market Operator on a real-time basis;
(b) to allow each of SEHK and the relevant SEHK Subsidiaries to: (i) collect, use and store your BCAN, CID and any consolidated, validated and mapped BCANs and CID information provided by the relevant China Connect Clearing House (in the case of storage, by any of them or via Hong Kong Exchanges and Clearing Limited) for market surveillance and monitoring purposes and enforcement of the Rules of the Exchange; (ii) transfer such information to the relevant China Connect Market Operator (directly or through the relevant China Connect Clearing House) from time to time for the purposes set out in (c) and (d) below; and (iii) disclose such information to the relevant regulators and law enforcement agencies in Hong Kong so as to facilitate the performance of their statutory functions with respect to the Hong Kong financial markets;
(c) to allow the relevant China Connect Clearing House to: (i) collect, use and store your BCAN and CID to facilitate the consolidation and validation of BCANs and CID and the mapping of BCANs and CID with its investor identification database, and provide such consolidated, validated and mapped BCANs and CID information to the relevant China Connect Market Operator, the SEHK and the relevant SEHK Subsidiary; (ii) use your BCAN and CID for the performance of its regulatory functions of securities account management; and (iii) disclose such information to the Mainland regulatory authorities and law enforcement agencies having jurisdiction over it so as to facilitate the performance of their regulatory, surveillance and enforcement functions with respect to the Mainland financial markets; and
(d) to allow the relevant China Connect Market Operator to: (i) collect, use and store your BCAN and CID to facilitate their surveillance and monitoring of securities trading on the relevant China Connect Market through the use of the Services and enforcement of the rules of the relevant China Connect Market Operator; and (ii) disclose such information to the Mainland regulatory authorities and law enforcement agencies so as to facilitate the performance of their regulatory, surveillance and enforcement functions with respect to the Mainland financial markets.
By instructing the Bank in respect of any transaction relating to China Connect Order, you acknowledge and agree that we may use your personal data for the purposes of complying with the requirements of SEHK and its rules as in force from time to time in connection with the Services. You also acknowledge that despite any subsequent purported withdrawal of consent by you, your personal data may continue to be stored, used, disclosed, transferred and otherwise processed for the above purposes in connection with the Services, whether before or after such purported withdrawal of consent.
Consequences of failing to provide Personal Data or Consent
Failure to provide the Bank with your personal data or consent as described above may mean that the Bank will not, or no longer be able, as the case may be, to carry out your trading instructions or provide you with our Services.
This authorization and consent of the use and transfer of personal data is in addition to the Notice to customers and other individuals relating to the Personal Data (Privacy) Ordinance (“Ordinance”) and the Code of Practice on Consumer Credit Data (“Notice”) you received previously. You can refer to the Notice in more detail on the Bank’s website if you wish to read before giving the above prescribed consent.
The person to whom requests for access to or correction of data held by the Bank, or for information regarding the Bank’s data policies and practices and kinds of data held by the Bank is “Data Protection Officer, Standard Bank (Hong Kong) Limited, GPD Box 21, Hong Kong”