A liquidity provider has provided quotes with 30 spreads in response to my quote request. Has the liquidity provider breached its obligation to quote within the maximum bid-ask spread set out in the relevant listing document?

Yes, unless the situation falls within any of the circumstances described:

(a) during a pre-opening session or a closing auction session (if applicable);

(b) during the first 5 minutes of each morning session or the first 5 minutes after trading commences for the first time on a trading day;

(c) when the warrant or CBBC or any underlying asset is suspended from trading for any reason;

(d) when there is no warrant or CBBC available for market making activities;

(e) if the theoretical value of the warrant or CBBC is less than HK$0.01;

(f) in the case of CBBCs only, upon the occurrence of a mandatory call event;

(g) where the underlying asset is an index, if there occurs or exists any suspension of, or limitation imposed on, trading of options or futures contracts relating to the index or if the index level is not calculated or published as scheduled for any reason;

(h) when there are operational and technical problems beyond the control of the liquidity provider that hinder the liquidity provider’s ability to provide liquidity; or

(i) if there is a “fast market” which materially affects the issuer’s hedging ability.

The new tightened liquidity providing obligations for quote requests prescribe a maximum spread for quote request (20 spreads) with effect from 31 October 2012.