China clamps down on cross‑border brokers

On May 25, 2026 the China Securities Regulatory Commission (CSRC) announced a formal crackdown on illegal cross-border brokerage activities involving mainland clients. The move targets securities, futures and fund businesses that serve mainland investors from overseas without proper authorization.

The CSRC said the enforcement drive is backed by a joint implementation plan issued together with seven other government departments and approved by the State Council. The plan is designed to eradicate illegal cross-border securities, futures and fund operations over a two-year rectification period.

Regulators framed the initiative as a comprehensive clean-up of unlicensed or improperly structured services that allow mainland investors to trade offshore markets through overseas platforms.

During the two-year rectification period, overseas institutions that have been serving mainland investors face tight operating limits. They are prohibited from facilitating new buy orders or fresh capital inflows from mainland clients.

Under the plan, affected investors will only be allowed to place sell orders and conduct capital withdrawals via these platforms. The arrangement effectively shifts activity toward unwinding positions rather than building new offshore portfolios through the targeted brokers.

At the end of the two-year window, overseas institutions that had targeted mainland clients must shut down their mainland-facing websites, trading applications and supporting servers, according to the implementation plan.

The CSRC stated that Tiger Brokers (NZ) Limited, Futu Securities International (Hong Kong) Limited and Longbridge Securities (Hong Kong) Limited are being cracked down on for illegal cross-border business operations involving mainland clients.

Regulators said they will confiscate illegal gains from the associated domestic and overseas entities of Tiger, Futu and Longbridge. The CSRC added that it will impose severe penalties under relevant laws, signaling a punitive approach toward past conduct.

Market participants identified Futu and Tiger as among the largest overseas brokers serving mainland investors, suggesting that enforcement against these firms could have broad implications for cross-border retail trading flows.

Citic Securities estimated on May 25 that the new trading curbs could affect as much as HK$250 billion of assets in Hong Kong. Within that figure, Citic projected that Futu accounts for about HK$150–180 billion and Tiger Brokers for about HK$45–50 billion.

Analysts and market observers warned that restricting mainland investors’ ability to add new funds or positions via these brokers could influence trading activity and liquidity in Hong Kong, including demand for future share offerings.

Some commentary highlighted that the mandatory shutdown of mainland-targeted platforms after two years may further reshape how mainland investors access offshore markets through Hong Kong.

Media reports on May 25–26 described a swift reaction among mainland retail investors following the CSRC announcement. Some clients of the targeted platforms began selling offshore holdings and preparing to move assets away from the affected brokers.

Bloomberg reported that Chinese investors rushed to find alternative ways to buy and sell overseas equities after the crackdown. One investor cited in the report said he sold around US$120,000 of U.S. stocks in response to the new measures.

Market observers said investors have been seeking alternative execution or custody channels to maintain access to overseas markets, amid concerns about future restrictions on existing cross-border trading routes.