Compliance Report ISSA Recommendations 2000

ISSA - International Securtities Services Association

Compliance to the ISSA Recommendations 2000

Market: China

Status: October 31, 2001

Recommendation 1
Recommendation 2
Recommendation 3
Recommendation 4

Recommendation 5
Recommendation 6
Recommendation 7
Recommendation 8

Market selection

Recommendation 3

The industry worldwide must satisfy the need for efficient, fast settlement by full adherence to the International Securities Numbering process (ISO 6166) and uniform usage of ISO 15022 based standards for all securities messages. The industry should seek to introduce a global client and counterpart identification methodology (BIC - ISO 9362) to further facilitate straight through processing. Applications and programmes should be structured in such a way as to facilitate open inter-action between all parties.

1. Does the market use ISIN as the primary securities identification code? ISIN code is not officially recognized at this stage. The market uses the stock code assigned by Shanghai/Shenzhen stock exchanges as the securities identification code.

2. Are the major participants in the market linked electronically? The central depositories' settlement clearing system is linked to all clearing participants including custodian bank electronically via B_Com/PROP. All trades related information and report can be transferred via that system.

3. Does the depository communicate using true (i.e. not bilaterally agreed on sub-standards) ISO standards for securities messaging? Since the two central depositories have been centralized on 30 March 2001, their systems are supposed to be integrated and standardized in future. Currently, all report message communicated between central depositories and counterparties are in the form of database file and ISO standards for securities messaging has not been introduced by central depositories.

4. Does the market operate standard identification codes for counterparties or client accounts and, if so, how do (or could) these fit into a single global identification methodology? The central depositories have assigned the unique counterparty code and investor code to identify their participants / investors. However, BIC code is not officially used.

1.	Does the market use ISIN as the primary securities identification code?	ISIN code is not officially recognized at this stage. The market uses the stock code assigned by Shanghai/Shenzhen stock exchanges as the securities identification code.
2.	Are the major participants in the market linked electronically?	The central depositories' settlement clearing system is linked to all clearing participants including custodian bank electronically via B_Com/PROP. All trades related information and report can be transferred via that system.
3.	Does the depository communicate using true (i.e. not bilaterally agreed on sub-standards) ISO standards for securities messaging?	Since the two central depositories have been centralized on 30 March 2001, their systems are supposed to be integrated and standardized in future. Currently, all report message communicated between central depositories and counterparties are in the form of database file and ISO standards for securities messaging has not been introduced by central depositories.
4.	Does the market operate standard identification codes for counterparties or client accounts and, if so, how do (or could) these fit into a single global identification methodology?	The central depositories have assigned the unique counterparty code and investor code to identify their participants / investors. However, BIC code is not officially used.