China's securities watchdog has moved to amend its regulations on the stock trading connectivity mechanism between the Chinese mainland and Hong Kong to ban mainland investors from trading through the northbound legs of the HK-mainland stock link program.

The China Securities Regulatory Commission (CSRC) is currently seeking public opinion on the amendment.

The amendment stresses that qualified investors in the northbound leg of the HK-mainland stock link program do not include mainland investors.

The CSRC further noted that Hong Kong stockbrokers can't trade though the northbound legs of the HK-mainland stock link program on behalf of mainland investors. But the regulators gave a one-year buffer period for the rule, during which mainland investors can still trade their A shares through the aforementioned mechanism.

After the buffer period, mainland investors cannot buy A-shares though the trading legs, but they can still sell A shares through the mechanism.

The northbound legs of the mainland-HK stock link mechanism allow capital to flow from overseas to A-share markets in Shanghai and Shenzhen.

The CSRC's move to ban mainland investors from trading through the northbound legs of the HK-mainland stock link program came at a time when some mainland investors have been opening accounts in Hong Kong to trade in A shares via the stock link mechanism.

According to the CSRC, there are about 1.7 million mainland investors that have gained such trading authority, and their trading volume accounts for about 1 percent of the overall northbound trade volume in the stock link mechanism.

This kind of trading has created the illusion of foreign investor involvement, which is not good for the long-term development of the stock link program, and can also lead to risks of cross-border illegal activities, the CSRC said.