Asia

Topic: Securities

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Hong Kong: SFC releases consultation conclusions on proposed guidelines for securities margin financing activities

On 4 April 2019, the Securities and Futures Commission (SFC) released the conclusions of its consultation on proposed guidelines for securities margin financing activities (the Guidelines). The existing conduct requirements for securities margin financing activities are mainly prescribed in the Code of Conduct for Persons Licensed by or Registered with the SFC and the Management, … Continue Reading

Hong Kong: SFC issues reminder about security token offerings

On 28 March 2019, the Securities and Futures Commission (SFC) published a statement reminding parties who engage in security token offerings (STOs) to be aware of the applicable legal and regulatory requirements.  This statement is helpful given that STOs are a relatively new form of token issuance. STOs are specific offerings which are structured to … Continue Reading

SFC publishes consultation conclusion on disclosure requirements for discretionary accounts

The Securities and Futures Commission (SFC) published its consultation conclusion on 23 May 2018 in relation to the proposed disclosure requirements for intermediaries providing discretionary account management services (Discretionary Account Managers). This consultation conclusion has been released in connection with the consultation on this topic issued by the SFC in November 20171. In view of … Continue Reading

Hong Kong’s SFC steps in to halt ICO

An investigation by Hong Kong’s Securities and Futures Commission (SFC) has led to the halt and unwinding of an initial coin offering (ICO) by Black Cell Technology Limited (Black Cell) to the Hong Kong public on the basis that Black Cell potentially engaged in unauthorized promotional and unlicensed regulated activities. Black Cell promoted the token … Continue Reading

Hong Kong: Cyber security and internet trading

The Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) are increasingly focused on cyber security in light of the threat posed to the integrity, efficiency and soundness of financial markets by cyber threats and hacks. On 27 October 2017, the SFC issued new Guidelines for Reducing and Mitigating Hacking Risks Associated … Continue Reading

Singapore: Revised regulatory regime for venture capital fund managers

The venture capital landscape in Asia continues to be robust. By Q2 2017,  global venture capital deal value reached US$ 40.1 billion, a healthy 55.3% increase.1  Asia accounted for US$12.7 billion, taking the second place from United States led venture capital investments which aggregated US$21.8 billion.2  Europe accounted for US$4.1 billion of global venture capital … Continue Reading

Hong Kong: Securities and Futures Commission has voiced concerns over asset management practices

The Securities and Futures Commission (SFC) recently issued two circulars to licensed corporations engaged in asset management business.  The circulars were issued following routine inspection by the SFC of corporations licensed for such activity. Irregularities identified relating to private funds and discretionary accounts The first circular was issued by the SFC on 31 July 2017 … Continue Reading

SFC and SEC enter into a memorandum of understanding to enhance supervision of cross-border regulated entities

To facilitate mutual assistance in the supervision and oversight of cross-border regulated entities, the Securities and Futures Commission (SFC) and the United Stated Securities and Exchange Commission (SEC) have recently entered into a memorandum of understanding (MoU). The MoU is a response to the growing globalisation of financial markets and the increased cross-border activities of … Continue Reading

SFC launches consultation into asset management regulation and point-of-sale transparency

In an effort to strengthen Hong Kong’s status as a leading asset management centre, on 23 November 2016 the Securities and Futures Commission (SFC) launched a three-month consultation into proposals to amend the Fund Manager Code of Conduct (FMCC) and the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures … Continue Reading

Hong Kong: Further consultation conclusions on introducing mandatory clearing and expanding mandatory reporting for OTC derivatives market

On 15 July 2016, the Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission published their further conclusions (Further Conclusions) on their consultation paper issued in September 2015 (Consultation Paper) on introducing mandatory clearing and expanding mandatory reporting for the second stage of the over-the-counter derivatives regulatory regime. The consultation conclusions, summarising and addressing … Continue Reading

Hong Kong: SFC releases updated Frequently Asked Questions on Offers of Investments and provides specific guidance on real property structures

On 17 June 2016, the Securities and Futures Commission (SFC) published an updated set of Frequently Asked Questions on “Offers of Investments” under the Securities and Futures Ordinance (FAQs). The FAQs now include a new Appendix 1 which provides guidance on collective investment schemes involving interests in real property, as well as updated answers to … Continue Reading

Hong Kong: Increased supervision and oversight in HK and the USA of regulated entities

On 20 May 2016, the Securities and Futures Commission (SFC) announced it had entered into a memorandum of understanding (MoU) with the United States’ Financial Industry Regulatory Authority (FINRA). The MoU records the authorities’ willingness to provide mutual assistance in the supervision and oversight of regulated entities that operate on a cross-border basis in Hong … Continue Reading

Hong Kong: Changes to the list of “specified shares” that are subject to the Short Position Reporting regime

On 18 May 2016, the Securities and Futures Commission published an updated list of “specified shares” listed on the Hong Kong Stock Exchange which are subject to the Securities and Futures (Short Position Reporting) Rules (Cap 571AJ).  A report is required to be made to the Securities and Futures Commission where a person has a … Continue Reading

Revision of The Singapore Code on Take-overs and Mergers

The revised Singapore Code on Take-overs and Mergers (Code) will come into effect on 25th March 2016. Key changes to the Code include, but are not limited to, the following: 1. Competing Offers (a) Alignment of Offer Timetable for Competing Offers The final day on which an offer can become or be declared unconditional as … Continue Reading

Proposed Amendments to the Securities & Futures (Reporting of Derivatives Contracts) Regulations

The Monetary Authority of Singapore (MAS) has issued a Consultation Paper on proposed amendments to the regulations for the reporting of derivatives contracts (Regulations) on 18 January 2016, as part of the ongoing development of the regulatory regime governing OTC derivatives. MAS also released its proposed implementation schedule for new reporting phases in relation to … Continue Reading

Hong Kong: SFC concludes on expanding scope of short position reporting

On 24 February 2016, the Securities and Futures Commission (SFC) published conclusions to their consultation proposing to expand the scope of the short position reporting by amending the Securities and Futures (Short Position Reporting) Rules (SPR Rules). The SFC has concluded that, as proposed in the original consultation, the short position reporting will be expanded … Continue Reading

Hong Kong: Introducing mandatory clearing and expanding mandatory reporting for the OTC derivatives market

On 5 February 2016, the Securities and Futures Commission (SFC) and Hong Kong Monetary Authority (HKMA) published their conclusions to the joint consultation paper they issued in September 2015 on introducing mandatory clearing and expanding mandatory reporting for the second stage of the over-the-counter derivatives regulatory regime. Amongst other things, the conclusions defer the commencement … Continue Reading

Hong Kong financial services: SFC introduces “suitability clause” to protect investors

Key points: The Securities and Futures Commission has introduced a “suitability clause” for client agreements governing the sale of financial products by intermediaries. The clause will provide a mechanism for investors to claim contractual damages against an intermediary where the licensed person either recommends a financial product or solicits its sale and the product is … Continue Reading

The Government publishes the Securities and Futures (Amendment) Ordinance

On 13 November 2015, the Government published in the Gazette the Securities and Futures (Amendment) Ordinance (Amendment Ordinance), which amends the Securities and Futures Ordinance (Cap. 571) (Ordinance) with immediate effect. The Amendment Ordinance follows on from the consultation conclusions published on 5 June 2015 in response to the consultation paper issued on 19 December … Continue Reading

Hong Kong: SFC Circular on persons engaging in activities relating to over-the-counter derivative products or transactions

The Securities and Futures Commission published a circular on 22 October 2015 to update the market on the implementation of the over-the-counter (OTC) derivatives regulatory regime (OTC Regime) in Hong Kong. The OTC Regime constitutes a new framework for introducing, reporting, clearing and trading requirements through subsidiary legislation and also: ­ brings certain activities relating … Continue Reading

Hong Kong cyber security: Monetary Authority calls for proactive approach to tackle threats

On 15 September 2015, the Hong Kong Monetary Authority (HKMA) issued a circular to authorised institutions to highlight the management of cyber security risk. Cyber security risk has been in the spotlight for a number of financial services regulators across the globe as an area of heightened risk, given the number of high profile attacks … Continue Reading

Hong Kong: Extension of profits tax exemption to PE funds welcomed

The Inland Revenue (Amendment) (No. 2) Ordinance 2015 (Amendment Ordinance) was gazetted and came into force on 17 July 2015. It amends the Inland Revenue Ordinance. Before the enactment of the Amendment Ordinance, the Inland Revenue Ordinance offered a profits tax exemption for certain transactions conducted by offshore funds in respect of eligible overseas portfolio … Continue Reading

Hong Kong consultation on changes to the Securities and Futures (Financial Resources) Rules

On 17 July 2015, the Securities and Futures Commission (SFC) released a consultation paper on proposed changes to the Securities and Futures (Financial Resources) Rules (FRR) relating to capital and other prudential requirements for licensed corporations engaged in over-the-counter (OTC) derivatives activity (Proposals). The purpose of the Proposals is to enhance the SFC’s prudential regulatory regime … Continue Reading

Cyber security in China: Draft law strengthens regulation of internet and data privacy

China has published a draft Cyber Security Law (Draft Law) for public discussion and feedback until 5 August 2015. This law, if enacted in its current form, will have far-reaching consequences for financial institutions with operations in China. In recent years, China has dedicated efforts to enhance the security and supervision of the Internet and telecommunication networks, in particular, … Continue Reading
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