Paul Chan Says HKEX Will Consult Market On T+1 Settlement Implementation Plan In First Half Of Year

On February 25, Financial Secretary Paul Chan presented the Government’s budget for the 2026–2027 fiscal year to the Legislative Council.

Paul Chan said that to further enhance the securities market, attract issuers and improve market efficiency, the Hong Kong Exchange will advance a series of initiatives. In the first quarter, the Exchange will consult the market on revisions to listing requirements for weighted voting rights companies, measures to facilitate secondary listings for overseas issuers, streamlining initial public offering procedures, and providing greater flexibility for biotech and special technology companies. During the first half of the year, the Exchange will finalize enhancements to the structured products listing framework and consult the market on the detailed implementation plan for a T+1 settlement cycle. In collaboration with the Securities and Futures Commission and industry participants, the Exchange will also pursue reforms to board lot sizes and introduce a paperless securities market system within the year.

Paul Chan indicated that Hong Kong will actively coordinate with mainland authorities to accelerate work on launching treasury futures in Hong Kong, including real estate investment trusts in Stock Connect, adding RMB trading counters to Stock Connect, and exploring further optimizations to Bond Connect.

To improve the business environment and facilitate corporate restructuring, Paul Chan proposed relaxing the stamp duty exemption criteria for intra‑group asset transfers by broadening the scope of eligible related entities. The government will submit legislative amendments within the year, and the proposed measures would apply to documents signed from today onward.

He noted that the quota for RMB business fund arrangements was doubled at the start of the month to RMB 200 billion to promote wider RMB usage in trade and cross‑border activities. Additional measures include promoting more convenient FX quoting and trading between the RMB and other regional currencies to reduce transaction costs, regularly issuing RMB bonds of various maturities to enrich offshore RMB products and improve the offshore RMB yield curve, working with the industry to develop the offshore RMB interest rate curve and strengthen short‑ and medium‑term rate price discovery, and attracting high‑quality issuers to expand RMB bond issuance in Hong Kong and encourage more cross‑border RMB transactions to be settled in the city.

Following the cooperation agreement signed earlier this year with the Shanghai Gold Exchange and the establishment of a Hong Kong central gold clearing system, Paul Chan said the government will study tax incentives for qualified institutions conducting gold trading and settlement in Hong Kong. The government will assist the industry in forming an association to consolidate resources, enhance promotion, expand domestic and international links, support industry training and skills development, and establish a training framework.

Paul Chan added that Hong Kong can help mainland aerospace firms connect with global markets by providing research, financing, risk management and legal services. The Office for Attracting Strategic Enterprises will identify suitable aerospace companies for development in Hong Kong, and he has asked the Hong Kong Exchange and Clearing Limited to review relevant listing rules to facilitate and attract more aerospace companies to list in the city.

Finally, Paul Chan announced that the first commercially operated autonomous transport system in Hong Kong is expected to commence operations within the year. The “Aerospace Corridor” autonomous transport system is slated to become the city’s first commercial driverless transport project.