Compliance updates
Circular on Operation of Bank accounts
July 7, 2021

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Circular to intermediaries, responsible officers and licensed representatives Waiver of annual licensing fees
March 23, 2021

19 Mar 2021 The Securities and Futures Commission (SFC) will waive the annual licensing fees of all intermediaries and licensed individuals incurred during the period from 1 April 2021 to 31 March 2022.  The SFC will not issue the usual demands for payment for annual licensing fees which would ordinarily [...]

[Regulatory Updates] Circular to Licensed Corporations and Associated Entities – Anti-Money Laundering / Counter-Financing of Terrorism
March 10, 2021

(1)  FATF Statement on High-Risk Jurisdictions subject to a Call for Action Further to our circular issued on 9 November 2020 Note 1, this is to inform you that the Financial Action Task Force (“FATF”) in a statement issued on 25 February 2021 Note 2 advised its members to refer [...]

regulatory update
AML/CFT Regtech: Case Studies and Insights
January 21, 2021

21 Jan 2021 HKMA published today (21 January 2021) a report titled “AML/CFT Regtech: Case Studies and Insights” highlighting the opportunities that Regtech offers to transform the effectiveness and efficiency of Anti-Money Laundering and Counter-Financing of Terrorism (AML/CFT) efforts, and sharing end-to-end approaches which worked in real-life examples. Following the [...]

HKEX STATEMENT ON STRUCTURED PRODUCTS
January 11, 2021

10 Jan 2021 Hong Kong Exchanges and Clearing Limited (HKEX) notes the decision to delist some structured products by some issuers, as a direct result of the US imposed sanctions. We do not believe this will have a material adverse impact on Hong Kong’s structured products market, the largest in [...]

regulatory update
SFC concludes consultation on customer due diligence requirements for open-ended fund companies
December 23, 2020

23 Dec 2020 SFC today released consultation conclusions on proposed customer due diligence requirements for open-ended fund companies (OFCs). The SFC will implement the proposal to require OFCs to appoint a responsible person to carry out anti-money laundering and counter financing of terrorism (AML/CFT) functions, in line with the Financial [...]

SFC licenses first virtual asset trading platform
December 16, 2020

16 Dec 2020 The Securities and Futures Commission (SFC) announces that it has granted the first licence to a virtual asset trading platform in Hong Kong. The platform will only serve professional investors under the close supervision of the SFC (Note 1) and will be subject to tailor-made requirements similar [...]

SFC statement on US sanctions
November 12, 2020

12 Nov 2020 The SFC is issuing this statement in response to enquiries following the latest announcement by the US government on the imposition of sanctions against additional individuals in Hong Kong and Mainland China. The SFC reiterates that in considering the implications of the sanctions, intermediaries are expected to [...]

Circular providing Interpretation Notes relating to the Guideline on Offering of Gifts (GL25) and the Guideline on Long Term Insurance Policy Replacement (GL27)
September 23, 2020

22 Sep 2020 The IA issues these Interpretation Notes with the aim of providing further guidance to authorized insurers and licensed insurance intermediaries in respect of the Guidelines after consultation with the key stakeholders. The Interpretation Notes are prepared in the form of Frequently Asked Questions to help illustrate the [...]

SFC launches consultation on anti-money laundering guidelines
September 21, 2020

18 Sep 2020 The SFC today launched a three-month consultation on proposals to amend its anti-money laundering and counter-financing of terrorism guidelines. The proposed amendments would facilitate the adoption of a risk-based approach to AML/CFT measures by the securities industry. They address some areas for enhancement identified in the latest [...]

Companies Registry to resume normal public services starting from September 15
September 14, 2020

11 Sep 2020 To align with the announcement by the Government yesterday (September 10) to resume normal public services from September 15, the Companies Registry announced today that it will resume normal services from September 15 while continuing to implement targeted measures to reduce social contact and to apply infection [...]

Changes to the open-ended fund companies regime take effect
September 14, 2020

11 Sep 2020 The SFC today announced that amendments to the Code on Open-ended Fund Companies (OFC Code) have taken effect. Among other changes, private open-ended fund companies (OFCs) in Hong Kong are no longer subject to investment restrictions and the eligibility requirements for OFC custodians have been expanded. The [...]

Insurance Authority consults on the proposed Insurance (Special Purpose Business) Rules
September 7, 2020

4 Sep 2020 The Insurance Authority launched a six-week public consultation on the draft Insurance (Special Purpose Business) Rules (the “SPB Rules”) to tie in with the expected implementation of the new regulatory regime for the issuance of insurance-linked securities (“ILS”) in Hong Kong in 2021. ILS are sophisticated financial [...]

SFC concludes consultation on changes to the open-ended fund companies regime and further consults on customer due diligence requirements
September 4, 2020

2 Sep 2020 The SFC today released consultation conclusions on enhancements to the open-ended fund companies (OFC) regime , including the removal of all investment restrictions for private OFCs. The SFC will also allow licensed or registered securities brokers to act as custodians for private OFCs and introduce a statutory [...]

Exchange publishes consultation conclusion on codification of general waivers and principles relating to IPOs and listed issuers and minor rule amendments
September 1, 2020

28 Aug 2020 The Stock Exchange of Hong Kong Limited today published conclusions to its consultation on the Codification of General Waivers and Principles relating to IPOs and Listed Issuers and Minor Rule Amendments (Consultation Conclusions). The Exchange also published a new Guidance Letter on Experience and Qualification Requirements of [...]

Applications for new licences by insurance agents and their technical representatives, licensed insurance brokers and their technical representatives who are deemed licensees
August 26, 2020

25 August 2020 When the Insurance Authority took over the direct supervision and regulation of insurance intermediaries on 23 September 2019, all insurance agents, their responsible officers (“ROs”) and their technical representatives (“TRs”) registered with the Insurance Agents Registration Board immediately prior to that date, and all insurance broker companies, [...]

Hong Kong’s asset and wealth management business reports strong growth in 2019
August 26, 2020

25 August 2020 The SFC latest Asset and Wealth Management Activities Survey found that the assets under management (AUM) of the asset and wealth management business in Hong Kong increased by 20% year-on-year to $28,769 billion as at 31 December 2019. “Hong Kong’s asset and wealth management business posted strong [...]

Insurance Authority office reopens to the public from 24 August
August 26, 2020

22 August 2020 The IA today announced that its office will reopen to the public and resume normal public services starting 24 August 2020. To minimise social contact and the risk of virus infection, members of the public are encouraged to make use of the IA’s hotline and online services [...]

Exchange Publishes Chapter 37 Consultation Conclusion and Guidance on Disclosures in Listing Documents and Continuing obligations under Chapter 37
August 26, 2020

21 August 2020 The Exchange received 22 responses from a broad range of respondents.  The feedback indicated strong support for the consultation proposals to enhance the listing regime for debt issues to professional investors only (Professional Debt Regime).  The Exchange will implement the consultation proposals, with modifications, reflecting comments received.  [...]

Latest arrangements for Companies Registry’s public services starting from 24 August
August 26, 2020

21 August 2020 Starting from 24 August, the Companies Registry will reopen the Public Search Centre on Monday, Wednesday and Friday while maintaining the limited counter services which it provides currently from Monday to Friday. Read more: https://www.cr.gov.hk/en/about/news/highlights.htm [...]

SFC issues quarterly report
August 21, 2020

20 August 2020 The SFC today published its latest Quarterly Report which summarises key developments from April to June 2020. To ensure that Hong Kong’s international financial markets function efficiently during the COVID-19 outbreak, the SFC stepped up its supervisory work and stress tests and allowed a measure of flexibility [...]

Insurance Authority consults on the proposed Insurance (Group Capital) Rules
August 21, 2020

19 Aug 2020 The Insurance Authority launched a six-week public consultation on the draft Insurance (Group Capital) Rules (the “Group Capital Rules”) to tie with the implementation of the new supervisory framework for multinational insurance groups tentatively in the first quarter of 2020. The main objective of the proposed Group [...]

Fees Reduction on Annual Return and e-Incorporation of Companies (with effect from 1 October 2020)
August 20, 2020

17 August 2020 With effect from 1 October 2020, the registration fees for annual returns (except for late delivery) charged by the Companies Registry will be waived for two years, and the fees payable for electronic incorporation of companies (including registration of non-Hong Kong companies) will also be reduced by [...]

Statement on Next Digital Limited
August 11, 2020

August 11 The SFC is issuing this statement in response to a large volume of enquiries it has received and the overall level of public interest in relation to the significant recent increases in the price and turnover in the shares of Next Digital Limited. In view of these exceptional [...]

iAM Smart Pilot Sandbox Programme
August 10, 2020

August 10 iAM Smart is one of the Government’s newest innovation initiatives to facilitate Hong Kong residents transacting online with the Government and commercial entities by enabling them to use a single unique electronic identity. Hong Kong residents can register and use iAM Smart free of charge and on a [...]

Response of the Insurance Authority to imposition of sanctions by the United States Government on individuals in Hong Kong
August 10, 2020

8 August 2020 The Insurance Authority (IA) is closely monitoring repercussions arising from unilateral sanctions recently imposed by the United States Government on a number of individuals in the Mainland and Hong Kong on 7 August 2020. An IA spokesperson said, “In assessing potential impact arising from the sanctions, market [...]

SFC statement on sanctions imposed by the US government
August 10, 2020

8 August 2020 On 7 August 2020, the US government announced the imposition of sanctions against individuals in Hong Kong and Mainland China. The SFC is monitoring closely the impact that the sanctions may have on the operation of intermediaries, the interests of investors and financial stability and orderliness of [...]

EXCHANGE PUBLISHES CONSULTATION PAPER ON REVIEW OF DISCIPLINARY POWERS AND SANCTIONS
August 10, 2020

7 August 2020 The Stock Exchange of Hong Kong Limited (the Exchange), published a consultation paper in relation to proposed changes in respect of the Exchange’s disciplinary regime. The Consultation Paper seeks comments on a number of proposals and enhancements, with a particular emphasis on strengthening the Exchange’s powers to [...]

Sandbox application for the distribution of long term insurance policies via video conferencing tools
August 7, 2020

5 August 2020 Authorized institutions (“AIs”) that intend to distribute long term insurance products via video conferencing tools should observe the requirements in the Circular and submit, through their appointing authorized insurers, the InsurTech Sandbox applications to the IA. The Hong Kong Monetary Authority (“HKMA”) will work with the IA [...]

Simplified Arrangements for Sale and Distribution of Eligible Retail Bonds Issued by Government and Related Organisations
July 31, 2020

31 July 2020 The HKMA considers correspondingly streamline the sale and distribution process for eligible plain vanilla and low-risk retail bonds issued by government and related organisations.Registered institutions (“RIs”) can execute customers’ orders of these bonds without triggering the suitability requirement if solicitation or recommendation is not involved. Where there [...]

Coronavirus disease (COVID-19) and Anti-Money Laundering and Counter-Financing of Terrorism (AML/CFT) measures – An Update
July 30, 2020

July 30 2020 Observations and industry practices to assist Authorized Institutions (AIs) in developing sustained efforts to cope with the evolving COVID-19 situation (I) Customer due diligence under social distancing and travel restrictions  Social distancing and a significant reduction in travel due to COVID-19 continue to significantly impact the ability [...]

Promoting Regtech Adoption in Hong Kong
July 27, 2020

27 July 2020 The HKMA has appointed an external consultant, KPMG Advisory (Hong Kong) Limited , to assist with organising a series of activities to further facilitate the adoption of Regtech. The HKMA, with the help of KPMG, launched a Regtech survey and will arrange a series of interviews with [...]

Introduction of a Limited Partnership Fund Regime
July 24, 2020

24 July 2020 The Limited Partnership Fund Ordinance (Cap. 637), which establishes a new limited partnership fund regime to enable private funds to be registered in the form of limited partnerships in Hong Kong, will come into operation on 31 August 2020 Read More: https://www.cr.gov.hk/en/publications/docs/ec2-2020-en.pdf [...]

Exchange seeks feedback on proposals to introduce a paperless listing & subscription regime, online display of documents and reduction of the types of documents on display
July 24, 2020

24 July 2020 The Stock Exchange of Hong Kong Limited, published : (i) a consultation paper seeking public feedback on proposals to introduce a paperless listing and subscription regime, online display of documents and a reduction of the types of documents on display (Consultation); Welcomes responses by 24 September 2020 [...]

Companies Registry to provide limited counter services starting from 20 July
July 19, 2020

The Companies Registry announced today that it will provide limited counter services every working day for receiving documents delivered in hard copy and collection of certificates for company incorporations from tomorrow until further notice. The limited opening hours of the Registry will be as follows with effect from July 20: [...]

Closure of Insurance Authority office
July 19, 2020

In view of the latest development of COVID-19, the Insurance Authority (IA) announced today (19 July 2020) that its office will be closed to the general public until further notice. However, enquiry and complaint hotline services will continue as normal, and their operating hours are set out on the IA [...]

Policy Statement by the Securities and Futures Commission
July 19, 2020

19 July 2020 The SFC would like to clarify that it is not aware of any aspect of the National Security Law which would affect or alter the existing ways in which firms and listed companies originate, access, disseminate and transmit financial market and related business information under the regulatory [...]

Circular to Licensed Corporations and Associated Entities – AML/ CFT Early Alert on United Nations Sanctions
July 17, 2020

July 17 2020 The sanctions committee of the United Nations Security Council (“UNSC”) which administers the sanctions regime for ISIL (Da’esh) and Al-Qaida added one individual to its sanctions list on 16 July 2020. Licensed corporations (“LCs”) and associated entities (“AEs”) should update their screening databases with the above changes [...]

Companies Registry releases statistics for the first half of 2020
July 14, 2020

July 14 2020 The total number of local companies registered under the Companies Ordinance was 1,381,355 as at the end of June this year, compared to 1,380,185 by the end of 2019.  A total of 48,760 local companies were newly registered during the first half of 2020, which shows a [...]

Circular to Licensed Corporations and Associated Entities – Anti-Money Laundering / Counter-Financing of Terrorism
July 10, 2020

10 Jul 2020 (1) FATF Statement on High-Risk Jurisdictions subject to a Call for ActionThe FATF advised its members to refer to the list of high-risk jurisdictions subject to a call for action adopted in February 2020, namely Iran and the Democratic People’s Republic of Korea, and that the FATF’s [...]

Government welcomes passage of limited partnership fund bill
July 10, 2020

9 July 2020 The Secretary for Financial Services and the Treasury, Mr Christopher Hui, welcomed the passage of the Limited Partnership Fund Bill by the Legislative Council today (July 9). The new Ordinance establishes a limited partnership fund regime which enables funds to be registered in the form of limited [...]

Circular to Licensed Corporations Updated Technical Specifications for OTC Derivatives Trade Reporting
July 8, 2020

8 Jul 2020 Today the Hong Kong Trade Repository (HKTR) issued a notice (Notice) about updated specifications for over-the-counter (OTC) derivatives trade reporting. A copy of the Notice is attached to this Circular. Licensed Corporations that may be subject to mandatory reporting obligation are advised to refer to the Notice. [...]

SFC office relocation
June 30, 2020

30 Jun 2020 The Securities and Futures Commission (SFC) is pleased to announce the relocation of its office. Effective 6 July 2020, please reach the SFC at: 54/F, One Island East18 Westlands Road, Quarry Bay, Hong Kong Please note that the move will take place in phases, and the SFC [...]

SFC publishes Annual Report 2019-20
June 24, 2020

24 Jun 2020 The Securities and Futures Commission (SFC) today published its Annual Report 2019-20 which sets out its priorities to ensure the integrity and overall soundness of Hong Kong’s securities and futures markets in the face of unprecedented challenges, particularly stemming from the COVID-19 outbreak. The report recaps the SFC’s efforts [...]

China Banking and Insurance Regulatory Commission extends preferential treatment for the Hong Kong insurance industry to 30 June 2021
June 23, 2020

23 June 2020 The China Banking and Insurance Regulatory Commission (CBIRC) today (23 June 2020) announced an extension of the preferential treatment accorded to Hong Kong under the “China Risk Oriented Solvency System” for another year to 30 June 2021, allowing Mainland insurers who cede businesses to qualified local professional [...]

Circular to licensed corporations Revised financial return form
June 13, 2020

26 Jun 2020 The Securities and Futures Commission (SFC) today published the draft of the revised form of the return required to be submitted by licensed corporations (LCs) under section 56 of the Securities and Futures (Financial Resources) Rules. The draft is included in the Annex to this circular. The [...]

Practice Notes supplementing Standards and Practices 5.4 and 7.1 of the Code of Conduct for Licensed Insurance Brokers
June 3, 2020

June 1 2020 Two separate Practice Notes supplementing certain Standardsand Practices of the Code of Conduct for Licensed Insurance Brokers (the “Code of Conduct”) have been issued today. The first Practice Note, which supplements Standard and Practice 5.4 in the Code of Conduct, sets out the minimum information which the [...]

Banking (Capital) Amendment Rules 2020
May 29, 2020

29 May 2020 Further to our letter of 24 April 2020, I am writing to inform you that the negative vetting by the Legislative Council of the Banking (Capital) (Amendment) Rules 2020 (“BCAR”) has now expired. The BCAR will come into operation on 30 June 2021. Read More:https://www.hkma.gov.hk/media/eng/doc/key-information/guidelines-and-circular/2020/20200529e1.pdf [...]

Additional measures to alleviate the impact of Covid-19
May 27, 2020

26 May 2020 Further to the deferral of the Basel III implementation announced by the Group of Central Bank Governors and Heads of Supervision (GHOS) on 27 March 2020, the Basel Committee on Banking Supervision (BCBS) issued additional guidance to alleviate the impact of Covid-19 on the global banking system on [...]

Report on Fintech Adoption and Innovation in the Hong Kong Banking Industry
May 20, 2020

20 May 2020 The Hong Kong Institute for Monetary and Financial Research (HKIMR), the research arm and subsidiary of the Hong Kong Academy of Finance (AoF),   today (20 May 2020) released a report, titled “Fintech Adoption and Innovation in the Hong Kong Banking Industry” as the first in a series [...]

Common Assessment Framework on Green and Sustainable Banking
May 13, 2020

13 May 2020 The HKMA has developed a common framework to assess the “greenness baseline” of individual authorized institutions to promote green and sustainable banking. Through the assessment, we intend to facilitate AIs in reviewing readiness and preparedness in addressing climate and environmental risks, help AIs formulate strategies and approaches, [...]

Circular to licensed corporations Margin requirements for non-centrally cleared OTC derivative transactions
May 7, 2020

7 May 2020 Summary: This circular informs licensed corporations (LCs) that the Securities and Futures Commission (SFC) will defer the introduction of initial margin (IM) requirements for non-centrally cleared over-the-counter (OTC) derivative transactions1 by one year to provide operational relief amidst the COVID-19 situation. Subject to specified thresholds, the IM requirements [...]

Joint Statement in relation to General Meetings in light of the Prevention and Control of Disease (Prohibition on Group Gathering) Regulation
April 1, 2020

1 Apr 2020 Following the HKSAR Government’s introduction of the Prevention and Control of Disease (Prohibition on Group Gathering) Regulation (Cap. 599G of the Laws of Hong Kong) (the “Regulation“), which became effective on 29 March 2020, to promote and maintain social distancing in light of the COVID-19 pandemic1, the [...]