When you authorize Power Securities to lend your securities to or deposit them with a third party according to the “Securities and Futures Ordinance” and the relevant rules and regulations, a certain degree of risk does exist. The authorization will only become effective under the circumstance that written consent has been given by you in respect thereof. In addition, the above written consent shall specify the effective date and the relevant effective period shall last for no more than 12 months. While the current legislation does not require you to sign the said written authorization, you should note that this type of written authorization may be required in certain circumstances. These circumstances include the provision of margin borrowings to you, authorizing the lending of your securities to third parties or depositing these securities with third parties as collateral, etc.
Prior to signing the written authorization, you may make enquiries with Power Securities to ascertain the purpose for which the authorization is needed. In case you sign on the written authorization and, your securities have already been lent to or deposited with a third party, such third party shall have lien or charge over your securities. Although your dealers or securities margin financiers shall be liable to you in regards to the lending or depositing of your securities according to the written authorization, the defaults of the above dealers or securities margin financiers may result in the loss of your securities. In view of this, Power Securities provides cash accounts that do not involve any securities lending activities. If you have no need of margin borrowings or do not wish your securities to be lent or charged, you should not sign on the above written authorization and alternatively, request for the opening of such cash accounts with Power Securities.