Xu Zhengyu: As of the end of May, a total of 85 funds have obtained mutual recognition between Mainland and Hong Kong.

In a written reply to legislators’ questions, Christopher Hui, Secretary for Financial Services and the Treasury, said that optimization measures for the mutual recognition of funds arrangement between the Mainland and Hong Kong have been implemented since last year, including easing the sales ratio limits for mutual recognition funds in the host market and allowing the investment management functions of Hong Kong mutual recognition funds to be delegated to overseas asset management institutions within the same group as the managers. These measures have enhanced the flexibility and scale of the arrangement. As of the end of May this year, a total of 85 funds have been recognized by the regulators in both places. In the whole of last year, the net subscription amount of Hong Kong mutual recognition funds in the Mainland was RMB 82.5 billion, representing an annual increase of 2.3 times.

Hui said that the Securities and Futures Commission has always maintained close communication with local fund managers, encouraging them to actively participate in the mutual recognition of funds arrangement based on factors such as their business development plans. The government and regulatory authorities will continue to discuss with the Mainland different optimized cross-border connectivity arrangements to support market development.

He added that as of the end of May this year, the comprehensive fund platform established by Hong Kong Exchanges and Clearing Limited has successfully attracted 55 financial institutions to participate, including fund companies, distributors, and registration agents. The platform is expected to launch “Platform and Agent Services” in the second half of this year, expanding its functions to cover agent services, and facilitating payments and settlement to improve market efficiency and reduce transaction costs. HKEX will continue to maintain close communication with regulators and industry stakeholders to enhance the platform’s operational efficiency and promote broader industry participation in the platform.