The trading tariff of HK$0.5 ($0.064) on each transaction will be removed from Jan 1, Hong Kong Exchanges and Clearing Ltd said, adding ad valorem fee, a tax derived from the value of a transaction, will be hiked from 0.005% to 0.00565%.

Besides simplifying fees and making trade costs more predictable, the decision will lower the trading fee rate from a historical average of about 0.00576% to 0.00565%, the bourse said in a statement.

The move comes as the exchange struggles to revive trading activity on its main markets. Average daily turnover of equity products traded on the bourse dropped 43% in the third quarter of 2022 from a year ago, data from it's latest earnings show.

The fee change "reflects HKEX's longstanding ongoing commitment to enhancing the attractiveness and competitiveness of its markets", Wilfred Yiu, co-chief operating officer and co-head of markets said in the statement.

(Reporting by Selena Li; Editing by Sumeet Chatterjee; Editing by Louise Heavens)

By Selena Li