HK Stock Market Move | HSBC Holdings (00005) rose by nearly 3% in early trading, reportedly planning to pay around $300 million to settle the French "Cum-Cum" tax case.

HSBC Holdings (00005) rose nearly 3% in early trading, as of press time, up 2.6% to HKD 114.6, with a turnover of HKD 521 million. On the news front, according to market news on December 10, sources revealed that HSBC Holdings is prepared to pay around $300 million to settle a French criminal case involving its alleged role in the so-called "Cum-Cum" dividend tax scandal. This scandal also involves some of France's largest banks. The logic behind the so-called Cum-Cum transactions is to allow foreign shareholders holding French stocks to lend their securities to tax-exempt entities, such as local banks, during the dividend season to avoid withholding tax. HSBC, the French National Financial Prosecutor's Office, and French tax officials all declined to comment. It is understood that both "Cum-Cum" and "Cum-Ex" are dividend-related tax evasion schemes that have occurred in European markets, with "Cum-Cum" mainly exploiting cross-border tax differences for arbitrage, while "Cum-Ex" focuses on creating ownership ambiguity through high-frequency trading to falsely claim multiple reimbursements. HSBC, as a major European financial institution, has been accused of deeply involved in such transactions from the late 2000s to the early 2010s, particularly in markets such as Germany and France.