Capital Markets Comparative Guide

1 Legal and regulatory framework

1.1 Which laws and regulations govern the capital markets in your jurisdiction?

Capital markets are, first and foremost, regulated by:

• the Financial System Act (FSA), approved by Decree-Law 32/93/M; and
• the Commercial Code, approved by Decree-Law 40/99/M.

Considering that the FSA dates from 1993 and the Commercial Code from 1999, the local regulator has issued directives to keep the local market up to speed with the latest trends. These include:

• Notices 009/B/2019-DSB/AMCM and 008/B/2021-DSB/AMCM (‘Bond Directives'); and
• Notice 008/B/2022-DSB/AMCM (‘Guideline on Bond Registration and Settlement').

The above are the core regulations with relevance to capital markets. Currently Macau does not have a stock market and the bond market is in its early stages, despite a significant push for its development since 2019.

1.2 Is your jurisdiction part of a supranational, transnational or multinational framework with relevance to capital markets? If yes, how does this work?

N/A.

1.3 Which bodies are responsible for regulating the capital markets in your jurisdiction? What powers do they have?

Capital markets in Macau are regulated by the Monetary Authority of Macau (AMCM).

The AMCM has a wide range of powers of licensing, oversight and enforcement over all financial institutions and activities in Macau.

With particular relevance to capital markets, the FSA empowers the AMCM to set:

• the limits and terms on which debt securities, certificates of deposit and other debt instruments may be issued;
• the limits and terms on which transferable loan certificates and other instruments of a similar nature may be issued; and
• the limits in respect of the underwriting of securities for indirect subscription or for the guarantee of their placement.

1.4 How does enforcement work and what kinds of sanctions may be applied?

The AMCM may investigate potential infractions through:

• complaints filed by the public;
• information that it becomes generally aware of;
• inspections conducted when considered necessary; and
• infractions that it becomes aware of in the exercise of its regulatory duties (eg, upon reviewing documents submitted by entities that are subject to supervision).

The AMCM may impose a wide range of sanctions, such as:

• monetary penalties;
• loss of capital applied in the operations subject to sanction;
• publication of sanctions;
• suspension of voting rights up to a maximum of five years;
• inhibition of office;
• cancellation of licences; and
• other remedial measures deemed appropriate.

2 Capital markets infrastructure

2.1 What is the capital markets infrastructure in your jurisdiction (eg, trading venues, central counterparties, central securities depositaries (CSDs)?

Currently, the main capital markets infrastructure in Macau comprises:

• Chongwa (Macao) Financial Asset Exchange Co, Ltd (MOX) – a platform for listing bonds and other securities in Macau; and
• Macao Central Securities Depository and Clearing Limited (MCSD), which mainly provides securities registration, clearing, settlement, depository and related services.

2.2 What are the main exchanges and other trading venues in your jurisdiction? What are the key differences between those various trading venues?

Currently, the only exchange in Macau is MOX.

2.3 What kinds of securities does your jurisdiction provide for (eg, electronic securities)?

Although by law physical certificates are allowed, currently only electronic certificates are provided.

2.4 Is it mandatory to deposit securities with a (local) CSD (eg, for listing)?

According to the Guideline on Bond Registration and Settlement, all bonds issued in Macau are subject to centralised registration, custody and settlement at the MCSD.

This notwithstanding, it is common in Macau for investors to deal in over-the-counter debt securities acquired through locally authorised financial institutions and which are not subject to deposit with the MCSD.

2.5 Are there rules in place governing crypto-assets and crypto-infrastructure (eg, crypto-exchanges, local crypto-money)?

There is no regulatory framework in place regarding crypto-assets/crypto-infrastructure.

The position of the Monetary Authority of Macau (AMCM) is that cryptocurrencies are ‘virtual commodities' and are neither legal tender nor financial instruments; therefore, they are not subject to the AMCM's supervision.

Nevertheless, and considering the AMCM's view that crypto-assets bear significant risks, all local financial institutions have been barred by the AMCM from participating in any transactions related to crypto-assets (eg, wire transfers to crypto-exchanges; cryptocurrency purchases with local credit cards).

2.6 Are special rules in place for crowdfunding products?

Currently there are no rules in place for crowdfunding.

2.7 What kinds of databases are available on instruments issued and traded in your jurisdiction, and how can they be accessed?

Instruments issued and traded in Macau are available on MOX's website at www.cmox.mo/wcm/macao_en/html/index.html. It is also possible to obtain information regarding bonds issued in Macau on the MCSD's website at www.mcsd.com.mo/en/information.

3 Trading and post-trading infrastructure

3.1 What kind of market infrastructure does your jurisdiction provide for?

Currently, the main capital markets infrastructure in Macau comprises:

• Chongwa (Macao) Financial Asset Exchange Co, Ltd (MOX) – a platform for listing bonds and other securities in Macau; and
• Macao Central Securities Depository and Clearing Limited (MCSD), which mainly provides securities registration, clearing, settlement, depository and related services.

3.2 What are the rules governing liquidity flows across execution venues (eg, use of systematic internalisers, trading obligations)?

N/A.

3.3 Are there rules on light and dark markets and how do these apply?

N/A.

3.4 Are market participants subject to best execution requirements?

N/A.

3.5 Does your jurisdiction apply a target market concept?

There are three main target markets defined in applicable regulations pertaining to the issuance and distribution of securities:

• professional investors;
• the general public; and
• for certain matters, persons aged 65 or over.

In summary, distribution of securities to the general public is subject to stricter requirements (eg, a favourable opinion of the Monetary Authority of Macau and authorisation of the chief executive in the case of bonds); whereas for professional investors, the requirements are less strict and are mainly aimed at ensuring fair treatment and sufficient information disclosure.

‘Professional investors' are:

• individuals or institutions with a portfolio of at least MOP 8 million; or
• institutions with total assets of not less than MOP 400 million.

Finally, additional information duties and duties of care are imposed on financial institutions when distributing financial products to persons aged 65 or over.

3.6 How does securities settlement work in your jurisdiction?

Settlement of bonds issued in Macau must be made through the MCSD. Participants will register with the MCSD and appoint one of the designated settlement institutions (currently Bank of China Limited Macau Branch and Industrial and Commercial Bank of China (Macau) Limited).

All funds shall be settled through clearing accounts opened with these settlement institutions.

As for other securities sold or distributed in Macau through financial institutions, typically such financial institutions will settle the securities in the client's bank account in accordance with the agreements entered into with the clients.

4 Listing and delisting of shares and bonds

4.1 What key requirements must be met to obtain a primary listing in your jurisdiction? What restrictions apply in this regard? Do any exemptions apply?

Public subscription bonds issued to professional investors:

• An audit confirming:
• • profit – the issuer has obtained profits (after tax) in the past three years;
  • operating cash flow – net cash flow in the previous year;
  • interest paying capacity – average profit (after tax) in the past three years of at least 100% of the total annual interest payments; and
  • value of assets/capital – net assets (excluding intangible assets) of at least MOP 100 million;
• verification of robust internal control and risk management without material defects;
• no debt default or interest in arrears in the past three years;
• no breach of law of or material irregularities by the issuer, its directors or main shareholders;
• an appropriate, reasonable and feasible bond issuance plan;
• for foreign issuers, evidence of any authorisations by foreign regulators that may be required; and
• such other requirements as MOX, MCSD or the Monetary Authority of Macau (AMCM) may deem appropriate.

Public subscription bonds issued to the general public: In addition to the requirements stated above:

• a rating by a rating agency;
• no debt default or interest in arrears in the past five years;
• net profit (after tax) in the past five years of at least 150% of the total annual interest payments; and
• such other requirements as MOX, MCSD or the AMCM may deem appropriate.

Private subscription bond issuances are exempt from the above requirements, but can only be sold to professional investors.

4.2 What key requirements must be met to obtain a secondary listing in your jurisdiction? What restrictions apply in this regard? Do any exemptions apply?

A secondary listing shall be subject to the same requirements as outlined in question 4.1.

4.3 What are the most common listing structures? What are the advantages and disadvantages of these different types of structures? What other factors should companies consider when deciding on a listing structure?

The most common listing structures in Macau are:

• the issuance of public subscription bonds to professional investors by local banks; and
• the issuance of private subscription bonds by foreign entities.

Both of these structures have the advantage of not being subject to the authorisation of the chief executive of Macau, which streamlines the procedures.

4.4 How does the listing of bonds differ from the listing of shares?

N/A. Currently Macau does not have a stock market.

4.5 What advisers are typically involved in the listing process? What claims (if any) can be brought against advisers with regard to their role in the listing process? Is there any way to mitigate such liability?

Typically, the advisers involved in the listing of bonds in Macau will be auditors of the issuer and counsel to the parties involved.

Both auditors and counsel (and other advisers) are subject to general civil liability rules, although there are no known cases of claims being brought against advisers in Macau.

Given the dearth of legal precedent, it is hard to anticipate any mitigation measures beyond exercising customary duties of care and adding appropriate qualifications and disclosure when required.

4.6 What other factors should companies consider when deciding on a listing strategy?

N/A.

4.7 What are the typical reasons for voluntary delisting? What are the grounds for compulsory delisting? What is the process for delisting?

Given the embryonic nature of the market, there are no known cases of voluntary or compulsory delisting. In addition, there are no rules on voluntary and/or compulsory delisting.

In cases of compulsory delisting, the AMCM and/or MOX will issue the relevant directives/guidelines.

As for MCSD, there are general rules stating that MCSD may suspend or cancel a participant and that, in such event, all outstanding fees must be settled.

In cases of voluntary delisting, delisting must be arranged by the parties. MCSD's rules provide that in cases of voluntary delisting, any outstanding fees must be settled prior to delisting.

4.8 What tax considerations should be borne in mind from the issuer's perspective?

By law, the issuance of bonds in Macau is subject to stamp duty at the rate of 0.2% on the issuance amount. In addition, the sale and purchase of bonds are subject to stamp duty at the rate of 0.5% on the consideration value.

As for income tax, interest payments or proceeds obtained from the sale and purchase, redemption or other forms of disposal of bonds issued in Macau are subject to income tax, which is charged on taxable income at the maximum rate of 12%.

The latest version of the Income Tax Law (Law 21/78/M, as amended by Law 21/2019) grants exemptions from income tax in relation to interest payments and profits obtained from the sale and purchase, redemption or other forms of disposal of three types of bonds (government bonds, local government bonds and central state-owned enterprise bonds).

Moreover, as a show of support to the bond market in Macau, the Macau Budget Law has been granting annual exemptions from:

• stamp duty in transactions for the issuance and sale and purchase of bonds issued in the Macau Special Administrative Region; and
• income tax on interest payments,or proceeds obtained from the sale and purchase, redemption or other forms of disposal of bonds issued in Macau.

It is expected that such exemptions will continue to be granted.

5 Prospectus rules and marketing

5.1 What kinds of instruments are subject to prospectus requirements?

All bonds issued in Macau are subject to the issuance of a prospectus.

However, there are different requirements established for public subscription bonds and private subscription bonds.

5.2 What are the key exemptions from the prospectus requirements and what kinds of selling restrictions might apply?

The prospectus for private subscription bonds need only provide sufficient information to allow the investors to understand the risks involved.

While the applicable regulations do not set out strict criteria, by ‘sufficient information' it is understood that at least the following elements must be addressed:

• the activity of the issuer;
• the financial standing of the issuer;
• information regarding the issuance;
• information communication mechanisms (eg, deadlines, methods and means of communication);
• procedures for the settlement of principal and interest; and
• other information deemed relevant.

Private subscription bonds may only be sold to a maximum of 50 professional investors and the minimum subscription amount is MOP 500,000.

‘Professional investors' are defined as individuals or institutions with a portfolio of at least MOP 8 million or institutions with total assets of not less than MOP 400 million.

5.3 What key information must be included in a prospectus? What other requirements and restrictions apply with regard to the content of the prospectus?

In general, all prospectuses must contain sufficient information to allow the investors to understand the risks involved.

The prospectuses of public subscription bonds must contain at least the following information:

• general information regarding the issuance;
• risk factors;
• the financial standing of the issuer;
• general information regarding the issuer;
• financial and accounting information of the issuer;
• credit support and other guarantees;
• information regarding the custodians; and
• a list of key information documents.

As for private subscription funds, the following information is required:

• the activity of the issuer;
• the financial standing of the issuer;
• information regarding the issuance;
• information communication mechanisms (eg, deadlines, methods and means of communication);
• procedures for the settlement of principal and interest; and
• other information deemed relevant.

5.4 What is the process for preparation, approval, filing and publication of the prospectus? How long does each step take?

The prospectus is prepared by the issuer and other advisers to the transaction. The timing of preparation will vary from deal to deal, but typically takes between two weeks and one month, although other factors such as foreign regulatory approvals may delay the process.

If the bonds to be issued are destined for private subscription (or for public subscription by professional investors and issued by local banks), the finalised draft of the prospectus, together with other documentation required for the transaction (eg, legal opinions, audit reports), must be submitted to MOX and MCSD, which will issue confirmation within approximately one to two weeks.

Once confirmation is received from MOX and MCSD, publication will be relatively fast; although again, the required formalities and approvals from foreign jurisdictions may delay the process.

As bonds destined for public subscription require a previous favourable opinion from the Monetary Authority of Macau (AMCM) and the approval of the chief executive, which will introduce additional timing constraints and uncertainties, these are not currently being issued in Macau.

5.5 What are the rules governing prospectus summaries/key information documents (KIDs) in your jurisdiction?

The prospectus summaries and key information documents are governed by AMCM Notices 009/B/2019-DSB/AMCM and 008/B/2021-DSB/AMCM (‘Bond Directives').

5.6 Who is liable for the content of a prospectus/KID in your jurisdiction? On what grounds can such claims be brought? Is there any way to mitigate such liability?

Under the Bond Directives, members of the board of directors and top management are ultimately responsible for conducting due diligence procedures; while the issuer is ultimately responsible for ensuring the authenticity of the information disclosed (including in the prospectus).

In accordance with the Macau Commercial Code, directors and companies (the issuer) are liable towards third parties, under general civil liability rules, in case of intentional harm to their rights as creditors. The auditors and counsel (and other advisers) are also subject to general civil liability rules in the exercise of their duties.

There are no known cases of claims being brought against issuers, directors, auditors or counsel in Macau in connection with the issuance of bonds.

Given the dearth of legal precedent, it is hard to anticipate any mitigation measures beyond exercising customary duties of care and adding appropriate qualifications and disclosure when required.

6 Financial services (marketing and distribution)

6.1 What kinds of services in financial instruments are subject to authorisation requirements? Is proprietary trading allowed per se?

Under the Financial System Act, financial institutions are only allowed to provide the services contemplated in their respective licence.

With relevance to capital markets, licences typically contemplate the following services:

• trading for own account or for the account of customers in money, financial and foreign exchange market instruments, financial futures and options, and transactions involving foreign exchange or interest rates and transferable securities;
• participation in issues and placements of securities and provision of other services related to such issues;
• portfolio safekeeping, administration and management; and
• management of other assets.

In general, entities allowed to provide the above services are:

• banking institutions;
• financial intermediaries; and
• asset management companies.

In addition, under Notice 033/B/2010-DSB/AMCM issued by the Monetary Authority of Macau (AMCM), prior to launching in the market a new financial product that falls within the scope of their licence, licensed entities must give notice to the AMCM and provide the following information:

• the procedural manual;
• the code of conduct;
• internal control guidelines;
• the eligibility policy; and
• product-specific information.

The AMCM will then:

• consent (expressly or tacitly) to the distribution of such products;
• issue recommendations; and/or
• ban the distribution of such product.

Approvals/consents are typically obtained for a certain line of business or general type of product and need not be obtained on a case-by-case basis.

Proprietary trading is allowed, provided that the AMCM grants the requisite authorisation to the relevant financial institution offering the platform.

6.2 Do special authorisation requirements apply to members of trading venues and/or issuers?

Besides the requirements mentioned in question 6.1, there are no applicable special authorisation requirements.

6.3 How are financial instruments typically marketed in your jurisdiction? Are there special rules for initial public offerings?

Typically, financial products will be marketed by financial institutions holding the requisite licences (eg, banks, insurers, financial intermediaries, asset management companies).

Financial institutions will either market their products directly or act as an agent/partner to foreign institutions.

As there is no stock exchange in Macau, there are no special rules for initial public offerings in Macau.

6.4 Is book building commonly used in your jurisdiction? If so, what does this process typically involve and do the regulatory requirements apply to book building? What are the advantages and disadvantages of book building?

Bookbuilding is commonly used in Macau. Taking into account that, although permitted by law, there are no offers of securities to the general public in Macau, but only to professional investors, book building is done by the underwriters under the terms contractually agreed and no specific legal requirements apply to this process.

6.5 What requirements and restrictions apply with regard to price stabilisation in your jurisdiction?

There are no applicable requirements and restrictions.

7 Derivatives

7.1 What trading and clearing obligations apply to derivatives?

Derivatives are not subject to special trading and clearing obligations. In summary, provided that financial institutions are licensed to offer derivatives, have complied with the requirements outlined in question 6.1 and have obtained the authorisation/implicit consent of the Monetary Authority of Macau, no other special requirements or obligations will apply.

Trading in derivatives is not very common in Macau. In addition, typically trading in derivatives by Macau investors will be done through foreign platforms which have obtained authorisation to operate in Macau by means of an agreement with a local financial institution.

7.2 Do mandatory risk mitigation techniques (eg, provision of collateral) apply?

There are no mandatory risk mitigation techniques applicable in Macau to the trading of derivatives. Nevertheless, as with the distribution of other financial products in Macau, local financial institutions must make a risk assessment and risk profile of their customers.

In addition, local financial institutions must ensure that the terms and conditions of the products being sold are comprehensible and in accordance with Macau laws.

7.3 Is a mandatory reporting system for derivatives transactions in place?

Besides general reporting requirements to which financial institutions are subject, there is no mandatory reporting system in place.

7.4 What are the commonly used framework agreements in your jurisdictions for non-cleared and cleared derivatives?

Taking into account that there is no specific legislation addressing the trading of derivatives, and that this is not a product commonly traded in Macau, typically the framework agreements to be used will depend on a foreign jurisdiction's/the counterparty's requirements.

This notwithstanding, we would say that International Swaps and Derivatives Association agreements are likely the most common.

8 Corporate governance/continuing obligations

8.1 What corporate governance requirements apply to listed companies?

N/A. Currently Macau does not have a stock market.

8.2 Is there a mandatory or voluntary corporate governance index? If so, what does it contain?

N/A. Currently Macau does not have a stock market.

8.3 What reporting obligations apply to listed companies? Do these vary if the issuer is a foreign company or between trading venues/segments?

N/A. Currently Macau does not have a stock market.

8.4 What other continuing obligations apply to listed companies?

N/A. Currently Macau does not have a stock market.

8.5 What are the consequences of breach of any of these obligations?

N/A. Currently Macau does not have a stock market.

8.6 Do mandatory auditing rules apply and is there a special review/enforcement process?

N/A. Currently Macau does not have a stock market.

9 Inside information and market manipulation

9.1 What qualifies as inside information?

There is no definition of ‘inside information' in Macau's legal framework.

Guidance can be found in certain provisions of the Commercial Code (Articles 153 to 173), which generally prohibit acts of unfair competition and/or acts that cause harm to Macau's economy.

In addition, Article 122 of the Financial System Act (FSA) deems as subject to sanction all actions that breach the FSA or that in general disturb the credit system and the financial markets.

Lastly, the Private Sector Corruption Law (19/2009) establishes certain criminal offences for persons who breach their managerial/functional duties, including where the breach causes situations of unfair competition.

In the absence of a clear definition, we believe that inside information could be covered by all of the above quoted provisions; although we are not aware of any inside information case having been raised or litigated in Macau that could be used as a benchmark.

9.2 What prohibitions apply to inside information? Is there a legitimate behaviour exemption?

N/A.

9.3 What are the rules on mandatory disclosure of inside information?

N/A.

9.4 Are there special provisions on the operation of insider lists and Chinese walls?

N/A.

9.5 Do special rules apply to personal transactions?

N/A.

9.6 What kinds of activities may amount to market manipulation?

There is no definition of ‘market manipulation' (in capital markets) in Macau's legal framework.

Guidance can be found in certain provisions of the Commercial Code (Articles 153 to 173), which generally prohibit acts of unfair competition and/or acts that cause harm to Macau's economy.

In addition, Article 122 of the Financial System Act (FSA) deems as subject to sanction all actions that breach the FSA or that in general disturb the credit system and the financial markets.

Lastly, the Private Sector Corruption Law (19/2009) establishes certain criminal offences for persons who breach their managerial/functional duties, including where the breach causes situations of unfair competition.

In the absence of a clear definition, we believe that market manipulation could be covered by all of the above quoted provisions; although we are not aware of any market manipulation case having been raised or litigated in Macau that could be used as a benchmark.

9.7 What are the consequences of breach of these requirements and restrictions, both for issuers and for their directors and officers?

Those that are harmed by acts of unfair competition may commence litigation against the party that has breached its duties. If successful, the court will order:

• the payment of compensation in a certain amount;
• the cessation of acts of unfair competition; and
• appropriate remedial measures.

If it is considered that there was a breach of Article 122 of the FSA, the Monetary Authority of Macau may impose sanctions such as:

• fines up to MOP 5 million (or MOP 10 million in case of recidivism);
• suspension of voting rights for one to five years;
• prohibition from exercising any office in a corporate body, as well as management or direction duties, in any supervised entities for six months to five years;
• loss of capital used on the sanctioned operations; and
• publication of the sanctions.

Finally, breaches of the Private Sector Corruption Law may be punished with monetary penalties or imprisonment for up to three years.

10 Short selling

10.1 What kinds of restrictions apply to short selling?

N/A.

10.2 Is a mandatory disclosure requirement in place regarding short selling?

N/A.

10.3 Is it permitted to write research reports while holding short positions?

N/A.

11 Sustainability

11.1 Is the term ‘sustainability' defined in your jurisdiction and, if so, how? Does it cover environmental as well as social objectives? How is compliance with sustainability assessed (eg, quantitatively or qualitatively)? Are there certain minimum requirements?

There is no definition of ‘sustainability' in the applicable legislation.

11.2 Are there special rules in place in your jurisdiction on the identification, management and disclosure of sustainability issues?

N/A.

11.3 Do applicable sustainability rules distinguish between sustainability risks (ie, financial risks resulting from sustainability issues) and the actual impact of corporate actions on, for example, the environment?

N/A.

11.4 Does your jurisdiction provide for a special green bond regime?

Chongwa (Macao) Financial Asset Exchange Co, Ltd (MOX) currently allows for the issuance and listing of green bonds. Although there is no special legal framework for green bonds, MOX will require external certification that the bonds to be issued qualify as green bonds.

Currently Macau has no certification agency and thus, typically, certification will be obtained in Hong Kong and/or mainland China.

11.5 Are there restrictions on the sale or distribution of instruments not considered sustainable?

N/A.

11.6 Is it necessary to comply with certain minimum standards (eg, on human rights) to qualify as a ‘green' issuer?

There are no minimum standards imposed by local law. That said, in order to qualify as a ‘green issuer', the issuer must obtain certification abroad – typically in Hong Kong and/or mainland China – and follow the standards imposed by those certification entities.

11.7 How will sustainability rules affect the capital markets in your jurisdiction?

N/A.

12 Product bans

12.1 What products are currently banned from sale or marketing to (certain kinds of) investors in your jurisdiction?

Currently, the only evident product ban is the prohibition imposed on all financial entities by the Monetary Authority of Macau (AMCM) from participating in any transactions related to crypto-assets (eg, wire transfers to crypto-exchanges; crypto-currency purchases with local credit cards).

Nevertheless, and as mentioned in question 6.1, the distribution by licensed entities of any new products is subject to prior notification to the AMCM, which may in turn allow or ban the distribution of such products and/or require that such products not be marketed to certain kinds of investors.

12.2 What is the process for imposing product bans and which regulators are in charge of this?

The AMCM is the entity in charge of imposing a product ban. There is no specific procedure to impose a product ban. In short, if the AMCM, upon conducting a review of a certain product, deems that it is not compliant with local laws or that it should not be offered, it will issue directives/instructions imposing a product ban.

13 Trends and predictions

13.1 How would you describe the current capital markets landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The capital markets in Macau are still in their early stages, with a focus on the development of the bond market. The primary objective is to attract entities from mainland China and Portuguese-speaking countries, encouraging their participation in renminbi financing operations.

This development coincides with the establishment of the Hengqin In-Depth Cooperation Zone, a key initiative in the Greater Bay Area plan where Macau aims to play a significant role. The Hengqin In-Depth Cooperation Zone focuses on sectors such as green finance, cross-border finance, traditional Chinese medicine, and cutting-edge technologies. Consequently, Macau's financial sector is expected to experience substantial growth to support these endeavours.

Another area expected to see growth is the issuance of debt in Macau by the central government, provincial governments, and local gaming operators. Additionally, the recent launch of the Micro Connect Macao Financial Assets Exchange (MCEX), a financial market platform connecting global capital with China's micro and small businesses, contributes to the diversification of Macau's economy and the development of a more sophisticated financial market.

Legislative initiatives are also underway to lay the foundation for the financial sector's growth. These initiatives include the revision of the Financial System Act and the introduction of new laws governing equities and funds. Furthermore, a new Trust Law came into effect in December 2022, aimed at attracting wealth management business to Macau and modernizing the financial sector to promote economic diversification.

While there has been discussion about establishing a renminbi-based stock market in Macau, no concrete steps have been taken to support this initiative thus far.

Overall, Macau is witnessing numerous initiatives and efforts to foster growth, and with its borders having reopened in early 2023, there is an expectation that attracting foreign investment and talent will become easier, providing a renewed impetus to the growth of Macau's financial markets.

14 Tips and traps

14.1 What are your top tips for the smooth conclusion of offerings in your jurisdiction and what potential sticking points would you highlight?

The conclusion of offerings in Macau is fairly simple and, as the market is still in its infancy, all the players involved in the process are cooperative and helpful. The underwriters will typically play a very active role and are familiar with the market. As such, the best tip is to find a reliable underwriter.

As for sticking points, offerings to the public are quite cumbersome (and dependent on the approval of the chief executive). As such, these are rare and there is a great market potential to be tapped if the appropriate legislative amendments are put in place.

It is expected that the revisions to the Financial System Act will address this matter and that things may change in the near future.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.