Bank of China interview: Keys to success

What is the general structure of Bank of China (Hong Kong)'s in-house legal team

There are 20 of us in the legal services centre at Bank of China (Hong Kong) Limited (BOCHK). 13 of us are Hong Kong, PRC or England qualified and seven of us are paralegals and administrative staff. I believe our 100% tri-lingual team is a very diverse and professional legal unit, serving over 14,000 employees within the Group. Even though most of the subsidiaries have their own legal staff, my in-house legal team has been working wholeheartedly providing guidance and support to them on issues at the Group level. We have weekly internal meetings and adopt an open-door policy in the office so that everyone is welcome to knock on our door with questions or issues.

What were some of the legislative changes this year

It has so far been a year of breakthrough. In March, company law reforms took place in both the PRC and Hong Kong. In Hong Kong, the new Companies Ordinance introduced significant changes to Hong Kong's corporate governance landscape; while in the PRC, the amended Company Law has completely revamped the concept of “registered capital” and removed its minimum requirement. A “one-yuan” company can now exist in the PRC.

The State Administration of Foreign Exchange (SAFE) has once again relaxed China's exchange control by announcing in May the long-awaited Provisions on Foreign Exchange Control in Connection with the Cross-Border Provision of Security and its implementing rules. Their biggest highlight is the streamlined administration and the removal of the old regime, which required SAFE approval and/or registration as pre-conditions to validity and effectiveness of cross-border security. As of June 1 2014, the validity of any cross-border security has no longer been subject to SAFE approval, registration, filing and any other administrative requirements. This represents a huge step forward by SAFE in terms of administrative efficiency and capital account liberalisation.

What is a typical day like for you working in the legal team of BOCHK

My typical day begins well before 9:00am. Equipped with a very capable team, I concentrate more on the managerial side of legal services. I manage six senior legal counsels and six legal counsels covering many areas of the law, such as banking and finance, capital markets, private banking, funds and asset management, cash management and custody, labour and dispute resolution. PRC law is definitely a key area given the significant growth of cross-border transactions. I am accountable for the overall performance of the legal function within the bank so I spend a huge amount of time with my team, offering mentorship, guidance and supervision.

What are some of the qualities you look for when working with outside counsel

A sound and solid knowledge of the law is of course a must, but being consistently excellent is also very important. And because BOCHK is often a pioneer in new banking products, we work very closely with external counsel to make sure that all legal issues are accounted for. The firms we work closely with are well-informed on regulatory trends in Hong Kong and the PRC, as well as global market practice. As our team serves the whole Group, the engagement of capable and efficient external counsel with good commercial acumen is key.

What are some of the efforts you have seen in the past year that aid in the internationalisation of the renminbi

We have witnessed multiple initiatives of the PRC authorities in bringing renminbi to wider international use, including renminbi outbound direct investments, renminbi foreign direct investments, RQFII, renminbi bonds, provision of renminbi services to non-Hong Kong residents and the cross-border renminbi loan trial scheme in Qianhai.

This year, the People's Bank of China (PBOC) announced several policies regarding offshore renminbi loans, renminbi cash pooling and renminbi Free-Trade Accounts in the China (Shanghai) Pilot Free Trade Zone (SFTZ). Policies surrounding the SFTZ are seen as innovative schemes which would likely form the basis of future nation-wide policies.

The recent joint statement of the China Securities Regulatory Commission and the Securities and Futures Commission on the Shanghai-Hong Kong Stock Connect pilot programme for establishing mutual stock market access between the Mainland and Hong Kong has sparked further hopes for the internationalisation of the renminbi.

The Hong Kong government has also shown tremendous support to renminbi internationalisation – officials of the Financial Services and the Treasury Bureau, including the Secretary himself, have on numerous occasions affirmed the government's efforts to strengthen Hong Kong's status as an offshore renminbi centre.

The PBOC has set up various clearing channels for offshore renminbi in Hong Kong, Taiwan, Macau and Singapore. Clearing banks will also soon be appointed in London and Frankfurt. In 2003, BOCHK was authorised as the sole renminbi clearing bank in Hong Kong and was designated to provide clearing and settlement services to renminbi-participating banks as well as a seamless interface for the securities clearing and settlement systems in Hong Kong. In the past year, the Hong Kong Monetary Authority has been very supportive of the development and management of Hong Kong's renminbi business from a regulatory perspective.