HL16 Oct 2019 15:06
QUESTIONS AND ANSWERS
Why will my China New Energy Ltd Shares be held with HSBC?
Hargreaves Lansdown uses the UK Central Securities Depository, CREST, for all equity and bond settlement and if a stock is withdrawn or cannot be held through CREST it restricts the trading options available to Hargreaves Lansdown clients.
In order to provide an on-going dealing facility in China New Energy Ltd Shares we have entered a global custody agreement with HSBC Bank plc. This agreement means that the stock can be held in its relevant overseas settlement system which ensures that trades in the stock can be settled. The Shares will continue to show in your Hargreaves Lansdown portfolio, but as the underlying custodian will be HSBC, or a sub-custodian of HSBC, there will be certain implications you should be aware of.
Whilst the stock is held with HSBC we will only allow sale instructions to be processed and all purchase requests will be rejected. It will only be possible to sell the Shares by phoning our Stockbrokers on 0117 980 9800, subject to telephone dealing rates of 1% of the consideration, subject to a minimum of £20 and a maximum of £50. Trades will be placed in Hong Kong Dollars and converted by Hargreaves Lansdown subject to our standard currency conversion fees.
Our Hong Kong broker will also charge a commission fee of HKD1,000.00 (currently approximately £100), which will be passed on to you.
Trades may also be bulked with other client orders, which may in some instances work to a client’s disadvantage.
You can find more information on our overseas Share dealing service at https://www.hl.co.uk/shares/share-dealing/overseas-share-dealing-service.
Are there any additional charges for holding the stock through HSBC?
There are no additional charges for transferring to or holding the stock through HSBC but there will be a transaction charge of £15.00 applied by HSBC to settle any transactions, which will be reflected on any contract notes.
When will I be able to trade my Shares on the Hong Kong Stock Exchange?
You will be able to trade your Shares on the Hong Kong Stock Exchange once they have been successfully transferred into our HSBC Account. This process will begin shortly after the Cancellation date that is yet to be scheduled and may take a number of weeks to complete, although we will work to ensure the transfer is concluded as quickly as possible.
Are there any additional risks created by Hargreaves Lansdown holding the Shares with HSBC?
The Shares will be held with our third party custodian, HSBC, who may in turn hold the Shares through a sub-custodian in the home country of the investment. The settlement, legal or regulatory requirements that apply to the Shares may differ from those applicable in the UK. Your investment may not benefit from the same protections in the event of the insolvency of the third party that may apply under UK law. A more detailed explanation of these additional ri
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