The People’s Bank of China and Hong Kong’s Securities and Futures Commission (SFC) have published revised implementation arrangements for the cross-boundary wealth management connect (WMC) pilot scheme in the Greater Bay Area (GBA).
These enhancements include allowing eligible licensed corporations (LCs) to participate in the cross-boundary WMC in the GBA, which includes nine mainland cities in Guangdong plus Hong Kong and Macau.
The scope of eligible investments will also be expanded to include riskier products scope and clarifying the promotion and sales arrangements. The measures also include increasing individual quotas to RMB 3m ($422,500), which is three times the current level.
The WMC scheme was launched in 2021 in an attempt to grow the GBA’s wealth management market, with a particular focus on mass-affluent and high net worth clients. It has coincided with China’s move to integrate Hong Kong more closely with the Mainland.
Prior to the launch of any Cross-Boundary WMC related activities, eligible LCs which intend to participate in the Cross-Boundary WMC must, among other requirements, partner with an eligible Mainland broker and work with it to ensure that all preparatory work, including the relevant system set-up, is properly performed.
Upon receiving the no objection notification from the SFC, LCs may conduct business activities under the Southbound Scheme, the Northbound Scheme or both.
The revised implementation rules will come into effect on 26 February 2024.