Corporate Actions

The corporate action platform provides an efficient and automated channel for market participants to disseminate and receive corporate action information of securities, streamlining income distribution events and enhancing post-trade operational efficiency within a unified circle of communication. This embodies the CMU's commitment to innovation and excellence, ensuring CMU Members and investors are at the forefront.

Benefits

• Hassle-Free Post-Trade Management: Simplifies the management of corporate actions, allowing participants to focus on core activities.
• Enhanced Operational Efficiency: Automated platform enables easy monitoring through real-time reports, reducing operational risks and back-office costs.
• Structured and Standardised Communication: Adoption of ISO 20022 standard message formats ensures structured and standardised corporate action messages, fostering clarity and consistency.

• The paying agents of CMU Instruments announces information about corporate actions to CMU Participants who hold the relevant CMU Instruments;
• The holding participants receive the corporate action notifications and sends authenticated custody instructions to the respective agents; and
• Where applicable and necessary, the CMU system distributes the proceeds of custody operations to CMU Participants on behalf of the respective paying agents. The custody distributions supported in the CMU system include securities and cash distributions which can be settled through the RTGS systems in Hong Kong

Mandatory (non-voluntary) and voluntary corporate actions

Non-voluntary events include mandatory corporate actions and do not generally require any action from holders. They are reported for information purposes only.

Voluntary corporate actions are generally options and offers, where holders can decide to participate, not to participate or for which a 'no action' instruction can be input.

• Options require action by the holders. They are described in the governing documentation of the security prospectus, and they are generally valid for a long period. Example is conversion of bonds into shares.
• Offers require action by the holders. They are announced from time to time by the management of the company or the issuing agent, and they are generally valid for a limited period only. Examples are subscription for new debt securities of a company, or taking up a purchase.

Related Information