The Securities and Futures Commission (SFC) of Hong Kong and the Taiwan Financial Supervisory Commission (FSC) on Friday signed and exchanged a Side Letter to a bilateral Memorandum of Understanding (MOU) which will facilitate cross listing of exchange-traded funds (ETF) in the two markets.
The SFC said that under the terms of the Side Letter, ETFs listed on the Hong Kong or Taiwan stock exchange and managed by asset managers licensed respectively by the SFC or the FSC will be mutually recognized in each other's jurisdiction for the purpose of cross listings and offerings.
The MOU was entered into by the two financial regulators in 1996. The Side Letter will also strengthen regulatory cooperation between the SFC and the FSC, in particular arrangements relating to information sharing and confidentiality regarding management of ETFs.
Welcoming the exchange of the Side Letter, John Tsang, financial secretary of the Hong Kong Special Administrative Region government, said that the Government attaches great importance to the cooperation between Hong Kong and Taiwan in the financial services sector.
"We look forward to the listing of Hong Kong/Taiwan ETFs in each other's stock exchange as soon as possible, so that market participants from both sides could benefit from a more diversified market," he said.