The first Hong Kong ETF approved for offering in Taiwan

The Securities and Futures Commission (SFC) welcomes the Taiwan Financial Supervisory Commission’s (Taiwan FSC) approval of the offering of the first Hong Kong exchange-traded fund (ETF) in Taiwan and its application to the Taiwan Stock Exchange for listing.

W.I.S.E. CSI 300 China Tracker, managed by BOCI-Prudential Asset Management Ltd (Note 1), became the first Hong Kong ETF approved by the Taiwan FSC following the exchange of the Side Letter to a bilateral Memorandum of Understanding between the two regulators in May 2009 (Note 2).

The SFC has also granted an approval-in-principle to the first Taiwan ETF, Polaris Taiwan Top 50 Tracker Fund, to cross-list in Hong Kong via a feeder fund. The final authorisation and listing of the ETF in Hong Kong is expected to take place soon.

“The respective approval of the first Hong Kong and Taiwan ETFs by the Taiwan FSC and the SFC marks the beginning of a strategic relationship that will bring long-term benefit to both markets. We look forward to closer co-operation with our Taiwan counterpart to facilitate market development on both sides,” said Mr Eddy Fong, the SFC’s Chairman.

The industry in Hong Kong and Taiwan are keen to capitalise on cross-listing opportunities facilitated by the Side Letter. A number of Hong Kong and Taiwan managers have indicated interest in cross-listings of their ETFs.

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Notes:

1. The listing of W.I.S.E. CSI 300 China Tracker (CSI 300) on Taiwan Stock Exchange will be done via a feeder fund structure, in which a Taiwan ETF will invest substantially all of its assets in the units of CSI 300 listed on the Stock Exchange of Hong Kong.
2. For details, see SFC press release dated 22 May 2009.