On “Shanghai-Hong Kong Stock Co-nnect” Program Cross-border Supervision Of Legal Issues

Prmier Li said in a speech at the opening of the Boao Forum for Asia(BFA) Conference, April 10,2014: “we will actively create conditions to establish a Shanghai-Hong Kong stock exchanges connectivity mechanism, and further promote two-way opening-up and healthy development of the capital markets on t-he mainland and Hong Kong. ”after that, China Securities Regulatory Commis-sion( hereinafter referred to as “ CSRC ”) and the Hong Kong Securities and Futures Commission( hereinafter referred to as “ SFC ”) on the same time issued a “Joint Announcement ”, so far Shanghai-Hong Kong Stock Connect w-as officially put on the agenda and there is a six-month lead time. the Shanghai-Hong Kong Stock Connect is another innovation after the Hong Kong S-tock express in 2007. Although Hong Kong Stock express as a pioneer in China’s capital account liberalization in 2008, but in the shadow of the US subprime mortgage crisis. But it does not affect the pace of China’s capital market li-beralization. unlike Hong Kong Stock express, Shanghai-Hong Kong Stock Connect is in the policy environment, economic environment ripe to carry out,both policy makers stock investors are far more rational.Shanghai-Hong Kong Stock Connect as a special mechanism for opening up the capital market, its biggest feature is to follow the existing rules and laws,at the same time it does not change the premise of bilateral investment transactions habits,which is able to achieve the sale of shares in the other market. the tiral of Shanghai-Hong Kong Stock Connect is benefit for Mainland and Hong Kong investors.Shanghai-Hong Kong Stock Connect is undoubtedly good news for investo-rs. After that Two securities markets will be more closely linked. the Mainland or Hong Kong investors can buy and sell other securities directly in the local market, which saves a lot of investment costs for investors. But incresing the cost of the securities regulatory supervision department. Especially in the case of the Mainland and Hong Kong stock market trading system, securities regulatory framework are differences of regulatory legal system.it is likely to lead to securities regulation and cooperation between the two unachieveing the desired results fully. Therefore the cross-border supervision of both Shanghai and Hong Kong through all of the securities regulatory authorities proposed two new requirements in the regulation of the images, content regulation, the scope of regulation or regulatory proceedings.In addition, after Shanghai-Hong Kong Stock Connect, Mainland and Hong Kong Information illegal disclosure, insider trading, market manipulation and securities fraud will be more diverse. Once participants violate the law tooking place in mainland China stock market, the securities regulatory authority in Hong Kong can not directly exercise administrative enforcement powers in the Mainland. So SFC inevitably seek with the securities regulatory authorities of the mainland, CRSC only have administrative enforcement powers and does not Quasi-judicial powers. CRSC should be what limits its scope to provide assistance? How to punish illegal behavior in the Shanghai-Hong Kong Stock Connect? CRSC in securities regulatory how coordinate with the Hong Kong Securitie regulations? Mainland Exchange and the Stock Exchange of Hong Kong in terms of how self-regulation with each other to achieve a comprehensive regulation of the securities market? Mainland securities law for acts of institutional and individual investors to invest in Hong Kong, how to regulate the securities market? How to define the powers of both sides of the border securities regulation ? And how to use the opportunity to improve the mainland via Hong Kong and Shanghai stock market regulatory standards ?Resolving this series regulatory issues is the focus of this research and Is the value of this paper. this article is based on the early period of the general business focus and dynamic understanding after opening,Through the analysis of Shanghai-Hong Kong Stock Connect program and its impact after it is introducted.