Hong Kong Regulations

SECURITIES AND FUTURES (FINANCIAL RESOURCES) RULES - SECT 16

Treatment of repurchase transactions

(1) Where a licensed corporation is the purchaser in the first instance of any
securities under a repurchase transaction, it is deemed for the purposes of
these Rules-

   (a)  to have an amount receivable from the seller of the securities equal
        to the consideration for which it purchased the securities; and

   (b)  not to own the securities purchased and so shall not include them in
        its liquid assets under section 27.

(2) Where a licensed corporation is the seller in the first instance of any
securities beneficially owned by it under a repurchase  transaction, it is
deemed for the purposes of these Rules-

   (a)  to remain the owner of the securities sold by it; and

   (b)  to be liable to the purchaser of the securities for an amount equal to
        the consideration for which it sold the securities.