Recommendation 1 Recommendation 2 Recommendation 3 Recommendation 4

Recommendation 5 Recommendation 6 Recommendation 7 Recommendation 8

Market selection

Recommendation 6

Convergence of Securities Systems, both within countries and across borders, should be encouraged where this eliminates operational risk, reduces cost and enhances market efficiency.

1.	Is the depository linked electronically and in real time with other segments of the core market infrastructure (e.g. trading platforms, netting systems, matching platforms, payment systems)?	CCASS is linked electronically with the trading system AMS/3 of the SEHK to facilitate the real-time transmission of trade details. It also has linkage with the Real Time Gross Settlement ("RTGS") system of Hong Kong Interbank Clearing Limited ("HKICL") for receiving messages of payment confirmations effected by participants' designated banks for securities settlement purpose.
2.	Is there one or more depository or settlement system in the market?	HKSCC is the only depository in Hong Kong providing central clearing and settlement services for securities listed on the SEHK. The Central Moneymarkets Unit ("CMU") of Hong Kong Monetary Authority ("HKMA") provides clearing and custody for Exchange Fund Bills and Notes and other debt instruments. It interfaces with the RTGS system to provide real time and end of day DvP services to CMU members.
3.	If there are several, has a consolidation been considered? If yes, by when?	Consolidation has not been considered.
4.	Does (do) the securities system(s) allow other domestic or foreign systems to establish direct links on an equal basis to local members?	Currently, CCASS does not allow direct link with other domestic or foreign systems. Upon the completion of CCASS/3 by mid 2002, we will be able to provide open connectivity to both local and overseas users. Participant Gateway ("PG"), a technical device installed at the participants' premises, will be able to provide an access point through which a Participant Supplied System ("PSS") can access CCASS/3.
5.	Does (do) the securities system(s) allow foreign market participants to become direct participants?	HKSCC currently only accepts companies registered in the British Virgin Islands under the International Business Companies Act as Corporate Investor Participants. CCASS/3 will ensure that we are technically ready to allow foreign market participants to become direct participants.