The Outline Development Plan for the Guangdong-Hong Kong-Macau Greater Bay Area (the plan) was launched in February 2019, with the aim of concretising goals (e.g. technological, financial, infrastructural development) set up by a framework agreement of developing the area from July 2017. In terms of the financial aspects of the 2019 plan, Hong Kong SAR and Macau SAR bear the responsibility for its external development, due to their historical comparative advantages. Internally, access to the mutual financial market among the Greater Bay cities is put in priority.
Following the guidance of internal development, the most recent milestone would be the establishment of the Memorandum of Understanding on the Launch of the Cross-boundary Wealth Management Connect Pilot Scheme (the scheme) in the Guangdong-Hong Kong-Macau Greater Bay Area (the memorandum), which was signed on February 5 2021 between seven parties. This included the People’s Bank of China (PBoC), China Banking and Insurance Regulatory Commission (CBIRC), China Securities Regulatory Commission (CSRC), State Administration of Foreign Exchange (SAFE), the Hong Kong Monetary Authority (HKMA), Securities and Futures Commission of Hong Kong (SFC) and the Monetary Authority of Macao (AMCM).
The scheme allows citizens of the Greater Bay Area to exercise individual cross-border banking investment. It is divided into the Northbound Scheme (mainland financial products for Hong Kong SAR and Macau SAR citizens) and the Southbound Scheme (Hong Kong SAR and Macau SAR products available for mainland citizens).
The memorandum aims at establishing common ground between the parties, ensuring effective operation and proper risk controls of the scheme.
Whereas this memorandum is not legally binding, the scheme will be operated under the principle of ‘regulation by the jurisdiction where the business is conducted’. Moreover, the parties would take up respective responsibilities in setting up guidance concerning management operation, anti-money laundering, personal information protection, etc. Besides, the parties have agreed on establishing a mechanism for collection and exchange of information under supervisory rules. In addition, regular liaison meetings would be held for the enhancement and arrangements of the implementation of the memorandum.
João Nuno Riquito
Managing partner, Riquito Advogados
Bernice Kwok
Trainee lawyer, Riquito Advogados
