Draft laws for scripless trading will go to public consultation in the third quarter of 2003 for tabling at the Legislative Council in the next legislative session.

This was the message from Secretary for Financial Services & the Treasury Frederick Ma responding to a question from Henry Wu in LegCo today.

The Securities & Futures Commission published in December a report setting out the strategy for implementing the various initiatives of the Steering Committee on the Enhancement of the Financial Infrastructure in Hong Kong, including straight-through processing of securities transactions and a scripless securities market.

Mr Ma said: "We are now drafting the enabling legislation to allow for scripless trading."

With regard to the implementation of straight-through processing for securities transactions, straight-through processing for trading at the retail level has been made available since the Hong Kong Exchanges & Clearing launched the Automatic Order Matching & Execution System/Third Generation in phases from October 2000 to February 2001.

The system is equipped with new peripheral systems, including a Multi-workstation System, Broker Supplied System and Order Routing System.

Investors can now enter orders directly into their brokers' systems through various electronic means (the Internet, mobile phones or PDAs) for execution.

To enhance investor protection and settlement efficiency at the retail level of straight-through processing, the commission has established a Task Force on Investor Participant Account Enhancement.

The objective of the task force is to look into ways to enhance the current Investor Participant Account structure to provide for full straight-through processing for retail investors (that is, enabling trading, securities and money settlement to be conducted by a single instruction).