Hong Kong institutions step up efforts to clean up illegal mainland transactions, with many tightening measures and some taking a wait-and-see approach.

Mainland investors' window to participate in Hong Kong capital market transactions through illegal cross-border channels is closing tighter and tighter. Yicai has learned that a number of Chinese-funded brokerages in Hong Kong have tightened their existing mainland business: mainland investors logging into their accounts from the mainland can only sell and withdraw funds, and cannot deposit funds or buy. The key to whether restrictions apply lies in whether the IP address used by mainland investors to log into their Hong Kong securities accounts shows they are in the mainland. According to the reporter's understanding, Industrial Securities International and Guotai Junan International implemented relevant restrictions starting September 7 and September 26, respectively, while Orient Financial Holdings recently issued a relevant notice to investors, to be implemented starting in October. Multiple industry insiders said that some Chinese-funded brokerages in Hong Kong are clearing up their existing mainland business mainly in connection with the Implementation Plan for the Comprehensive Rectification of Illegal Cross-Border Securities, Futures, and Fund Business Activities jointly issued by the China Securities Regulatory Commission and seven other departments in May this year. Previously, internet brokerages such as Futu, Tiger Brokers, and Longbridge had already adjusted their mainland business in June this year. However, some Chinese-funded brokerages in Hong Kong have not yet imposed relevant restrictions. Interviewees said some foreign institutions are in a wait-and-see state. Nevertheless, in the industry's view, whether Chinese-funded overseas institutions or foreign institutions, all face the need to clean up illegal existing mainland business, and more overseas institutions will adjust their existing mainland business going forward.