The Central Bank of Ireland (the Central Bank) permits Irish authorised investment funds to acquire Chinese shares via the Shanghai-Hong Kong Stock Connect programme. The Central Bank has set the following conditions:
- The depository must to satisfy itself that the manner in which the shares are to be held meet with the requirements of the UCITS/AIFM Regulations and any conditions imposed by the Central Bank.
- The depository or an entity within its custodial network (i.e. a sub-custodian) must ensure that it retains control over the shares at all times.
- The depository (or its sub-custodian) must be a participant in the Hong Kong Securities Clearing Company Ltd (HKSCC) (arrangements where the broker of the investment fund is a participant of HKSCC but not an entity within the depositary's custodial network, will not satisfy the provisions of the relevant legislation).
- The depository or a member of its custodial network can be a General Clearing Participant, Direct Clearing Participant or Custodian Participant as appropriately determined by the depositary in line with its legal obligations as depositary.
- The depository must keep under review the Stock Connect infrastructure arrangements to ensure that its legal obligations can be met.