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 2014. For more information on the consultation conclusions, please see our previous blog entry.
The aim of the Amendment Ordinance was to broaden the Securities and Futures Commission’s (SFC) powers to obtain information in order to assist regulators outside Hong Kong in non-enforcement matters.
The Amendment Ordinance introduces the following focal amendments:
- The SFC can now enter into a supervisory memoranda of understanding with regulators outside Hong Kong to enable two-way supervisory assistance, and provide a narrow form of supervisory assistance to such regulators.
- The SFC will only be allowed to provide assistance to a regulator outside Hong Kong if:
- providing such assistance is in the interests of the investing public or the public interest or such assistance will enable the recipient to perform its functions (which are in the interests of the investing public or the public interest);
- the regulator confirms, in writing, it was not able to fully ascertain the matters in relation to potential risks and impact to the financial stability of its jurisdiction and complying with legal/regulatory requirements in relation to transactions and activities regarding securities[1] in relation to a licensed corporation that is regulated by the SFC and the overseas regulator; and/or a related corporation of a licensed corporation where the related corporation is regulated by the overseas regulator; and
- the regulator confirms in writing that it will use the information ascertained solely for the purposes set out above, it will not use the information in relation to legal proceedings without the permission of the SFC and it will treat all information as confidential and will not disclose it to any other person.
[1] Including futures contracts, leveraged foreign exchange contracts, collective investment schemes, OTC derivative products or other similar transactions that the overseas regulators regulates
