Hong Kong
Legislative and Regulatory Amendments
- Securities and Futures Commission (SFC)
Voluntary Code of Conduct for ESG ratings and Data Products Providers
The SFC announced that the Hong Kong ESG Ratings and Data Products Providers VCoC Working Group (VCWG) has published a voluntary code of conduct (VCoC). The VCoC aims to establish a benchmark for the provision of high quality, reliable and transparent ESG information to combat greenwashing in Hong Kong’s growing green and sustainable finance ecosystem.
Date of Release: 3 Oct 2024
Implementation on: ESG ratings providers and ESG data products providers will have respective implementation periods of six months and 12 months from 3 Oct 2024
Applicable to: ESG ratings and data products providers
The SFC released consultation conclusions on proposals to introduce a statutory scheme of arrangement and compulsory acquisition mechanism for real estate investment trusts (REITs) (REIT Scheme Proposal) and an enhanced market conduct regime for listed collective investment schemes (CIS) under the Securities and Futures Ordinance (SFO). The REIT Scheme Proposal would enable REITs to conduct privatisation and corporate restructuring in a clear and orderly manner, with similar safeguards and protection for investors as embodied in the statutory framework under the Companies Ordinance.
Date of Release: 8 Oct 2024
Implementation on: The bill on legislative amendments to implement the proposals is being prepared with a target to complete in Dec 2025.
Applicable to: REITs
Asset Manager Misconduct in Managing Private Funds and Discretionary Accounts
The SFC issued a circular that flags various deficiencies and substandard conduct identified during its supervision of licensed corporations engaged in managing private funds and discretionary accounts. The severity of misconduct in many of these cases has seriously jeopardised investor interests, thereby undermining confidence in Hong Kong’s market integrity and status as an international asset management centre.
Date of Release: 9 Oct 2024
Implementation on: 9 Oct 2024
Applicable to: Asset Managers
Joint Statement on Enhanced Timeframe for New Listing Application Process
The SFC and The Stock Exchange of Hong Kong Limited announced an enhanced timeframe for the new listing application process (Enhanced Application Timeframe), to further elevate Hong Kong’s attractiveness as the leading international listing venue in the region. The Enhanced Application Timeframe will provide greater clarity and certainty to the timeline for reviewing New Listing applications by the SFC and the Exchange.
Date of Release: 18 Oct 2024
Implementation on: 18 Oct 2024
Applicable to: Capital Markets
Fast-tracks Simple Fund Authorisation to Bolster Hong Kong Market Appeal
The SFC announced that it will be expediting the processing of applications from simple investment funds by launching the Fund Authorisation Simple Track (FASTrack). Under FASTrack, the SFC aims to grant authorisations within 15 business days after receiving complete and quality submissions from applicants. The new approach will cover simple funds from jurisdictions which have mutual recognition of funds (MRF) arrangements with the SFC. The SFC will monitor the operation of FASTrack during a six-month pilot period ending 4 May 2025 and refine it as appropriate before formal adoption.
Date of Release: 21 Oct 2024
Implementation on: Formal adoption on or after 4 May 2025
Applicable to: Asset Managers and Funds
The SFC issued a circular to management companies of SFC-authorised unit trusts and mutual funds regarding information disclosure on information portal of integrated fund platform that is expected to be launched by The Hong Kong Exchanges and Clearing Limited (HKEX) in phases from end of 2024. The information portal will serve public interest by providing one-stop access to fund information which is required to be made available to investors.
Date of Release: 21 Oct 2024
Implementation on: End of 2024
Applicable to: SFC-authorised unit trusts and mutual funds
Full Adoption of e-IP Application/Submission System on WINGS
The SFC issued a circular to inform the industry about the extension of the parallel run period of its new online application/submission system for investment products, e-IP, by one month to 29 November 2024. After the extended period, applications and submissions of investment products administered by the Investment Products Division (IPD) must be submitted to IPD via e-IP from 30 November 2024.
Date of Release: 24 Oct 2024
Implementation on: 24 Oct 2024
Applicable to: Investment Products
The SFC issued a circular to management companies of SFC-authorised unit trusts and mutual funds regarding the amendments to the existing requirements for SFC-authorised funds’ enhanced fund data reporting to enhance its ability to perform supervisory and regulatory responsibilities, with effect from 31 January 2025.
Date of Release: 25 Oct 2024
Implementation on: 31 Jan 2025
Applicable to: SFC-authorised unit trusts and mutual funds
Consultation Conclusion on Market Sounding Guidelines
The SFC published consultation conclusions on its proposed guidelines for market soundings. The guidelines set out the principles and requirements applicable to licensed or registered persons when they conduct market soundings, which are most commonly seen in block trades. These requirements include implementing protocols to protect confidential information they are entrusted with during market soundings.
Date of Release: 31 Oct 2024
Implementation on: 2 May 2025
Applicable to: Licensed or Registered Corporations
Use of Generative AI Language Models
The SFC issued a circular to licensed corporations regarding the use of Artificial Intelligence Language Models (AI LMs) in conducting their regulated activities. It was noted that some firms are leveraging AI LMs to respond to client enquiries via public facing chatbots, summarise information, generate research reports, identify investment signals as part of the investment decision making process, or generate computer code during the development of software applications. In this context, the SFC outlined the requirements applicable to licensed corporations offering services or functionality provided by AI LMs or AI LM-based third-party products in relation to their regulated activities.
Date of Release: 12 Nov 2024
Implementation on: 12 Nov 2024
Applicable to: Licensed Corporations
The SFC issued a circular to provide guidance to asset managers regarding due diligence expectations for third-party ESG ratings and data products providers. Pursuant to General Principles 2 and 3 of the Code of Conduct, asset managers are generally expected to exercise due skill, care and diligence when engaging third-party service providers and ensure that such resources are adequate and effective for the proper performance of their business activities. To meet such regulatory expectations, asset managers should conduct reasonable due diligence and ongoing assessments on third-party ESG service providers.
Date of Release: 25 Nov 2024
Implementation on: 25 Nov 2024
Applicable to: Asset Managers
The revised list of persons designated as financial services providers (FSPs) for the purposes of the Securities and Futures is gazetted. Licensed persons are reminded that in case their average total position in OTC, during the calculation period has reach the Clearing threshold, relevant OTC derivative transactions they enter on and after the corresponding Prescribed Day, including those with FSPs must be centrally cleared in accordance with the Clearing Rules.
Date of Release: 6 Dec 2024
Implementation on: 1 Jan 2025
Applicable to: FSPs under the OTC Derivatives Regulatory Regime
Launch of Integrated Fund Platform
The SFC announced the Hong Kong Exchanges and Clearing Limited’s (HKEX) launch of the first phase of the Integrated Fund Platform (IFP). The Fund Repository, part of this new financial infrastructure in Hong Kong, will provide investors with a one-stop access to information on retail funds. HKEX will roll out other functionalities of the IFP, including a business platform and a communications network to facilitate dealing of funds on a business-to-business basis between fund managers and distributors.
Date of Release: 13 Dec 2024
Implementation on: 13 Dec 2024
Applicable to: Funds
Circular to Management Companies of SFC-authorised Money Market Funds
The SFC issued a circular to highlight its requirements and expectations for management companies (Managers) of SFC-authorised money market funds (MMFs) in managing the liquidity risk of such funds. Managers are required to maintain and implement effective liquidity risk management policies and procedures to monitor the liquidity risk of the MMFs under their management, taking into account factors including the funds’ investment strategy and objectives, investor base, liquidity profile, underlying obligations and redemption policy.
Date of Release: 17 Dec 2024
Implementation on: 17 Dec 2024
Applicable to: SFC-authorised money market funds
The SFC issued a circular to set out a clear roadmap for virtual asset trading platforms (VATPs) on the licensing process and provide more guidance on the second-phase assessment.
Date of Release: 18 Dec 2024
Implementation on: 18 Dec 2024
Applicable to: VATPs
Enhancement to Mainland-Hong Kong Mutual Recognition of Funds
The SFC announced the issuance of the revised Provisions on the Administration of Recognised Hong Kong Funds by the China Securities Regulatory Commission and the revised operating guidelines jointly by the People’s Bank of China and the State Administration of Foreign Exchange, for the purpose of implementing the enhancements to the Mutual Recognition of Funds (MRF) scheme. In this respect, the SFC also published a revised Circular on Mutual Recognition of Funds between the Mainland and Hong Kong.
Date of Release: 20 Dec 2024
Implementation on: 1 Jan 2025
Applicable to: Funds
The SFC issued a circular regarding the publication of (i) a revised Business and Risk Management Questionnaire (BRMQ) for licensed corporations (LCs) and associated entities (AEs); and (ii) an analysis of scheme assets for associated entity of an intermediary licensed or registered for Type 13 regulated activity in relation to the carrying on by the intermediary of Type 13 regulated activity (an RA13 Intermediary). The revisions to the BRMQ are made primarily for the implementation of the RA13 regime. All LCs and AEs should use the revised BRMQ for financial years ending on or after 31 December 2024 and submit the BRMQ electronically to the SFC via WINGS.
Date of Release: 27 Dec 2024
Implementation on: Financial years ending on or after 31 Dec 2024
Applicable to: Licensed Corporations and Associated Entities
- Hong Kong Monetary Authority (HKMA)
Establishment of CMU OmniClear Limited
The HKMA announced the establishment of CMU OmniClear Limited (CMU OmniClear), a wholly owned subsidiary of the Exchange Fund. Currently, the Central Moneymarkets Unit (CMU) operates as a unit of the HKMA. To enable the CMU to pursue a more commercial development path, CMU OmniClear has been established to operate the CMU system and pursue new business development initiatives under a contractual arrangement with the HKMA. The establishment of CMU OmniClear is an important step toward developing CMU into a major international central securities depository in Asia.
Date of Release: 18 Oct 2024
Implementation on: Jan 2025
Applicable to: Hong Kong Money Market
MOU between CMU OmniClear Limited and SIX to Unlock Further Cross-border Investment Opportunities
The HKMA announced that CMU OmniClear Limited and SIX signed a Memorandum of Understanding (MOU) for cooperation in securities depository and settlement to foster the growth of cross-border investment. Based on the MOU, the two parties will collaborate in a joint international securities settlement and safekeeping, develop a closer working relationship, and maintain channels for the exchange of information.
Date of Release: 18 Oct 2024
Implementation on: 18 Oct 2024
Applicable to: Hong Kong Money Market
Sustainable Finance Action Agenda
The HKMA announced the launch of the Sustainable Finance Action Agenda (“Action Agenda”) (Annex), setting out its vision to further consolidate Hong Kong’s position as the sustainable finance hub in the region and support the sustainable development of Asia and beyond. The Action Agenda sets out eight goals in four areas, covering aspirations not only for the HKMA, but also the banking sector. The following goals have direct implications in formulating the HKMA’s banking policy: (1) All banks to strive to achieve net zero in their own operations by 2030 and in their financed emissions by 2050; (2) All banks to enhance transparency on climate-related risks and opportunities; and (8) Close talent and knowledge gaps in sustainable finance in the region.
Date of Release: 21 Oct 2024
Implementation on: 21 Oct 2024
Applicable to: Banks
Partnership between HKMA and Banco Central do Brasil on Cross-Border Tokenisation Initiatives
The HKMA announced the collaboration with the Banco Central do Brasil (BCB) to conduct cross-border tokenisation experiments under Project Ensemble and Drex pilot programme. The two institutions will link their experimental central bank digital currency (CBDC) infrastructures, namely the Ensemble Sandbox and the Drex pilot platform, to explore cross-border payment-versus-payment (PvP) and delivery-versus-payment (DvP) settlement use cases in areas such as trade finance and carbon credits.
Date of Release: 28 Oct 2024
Implementation on: 28 Oct 2024
Applicable to: CBDC
HKMA and Multilateral Organisations Enhance Strategic Partnership for Climate Investment in Asia
The HKMA announced its strategic partnership with multilateral organisations, including the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), and International Finance Corporation (IFC), a member of the World Bank Group. The partnership marks a significant step towards strengthening strategic cooperation in sustainable finance in Asia.
Date of Release: 11 Nov 2024
Implementation on: 11 Nov 2024
Applicable to: Sustainable Finance
Enhanced Competency Framework on Green and Sustainable Finance
The HKMA announced the launch of the Professional Level of the Enhanced Competency Framework on Green and Sustainable Finance (ECF-GSF). The ECF-GSF sets out the competency standards for banking practitioners performing GSF-related functions in the banking industry in Hong Kong. The HKMA in collaboration with the banking industry has developed the Professional Level for middle-level and senior-level banking practitioners to acquire specialised domain knowledge related to GSF and develop professional competencies in the GSF-related area.
Date of Release: 21 Nov 2024
Implementation on: 21 Nov 2024
Applicable to: Banking Industry
Completion of Migration of Consumer Credit Reference Services to Credit Data Smart
The Hong Kong Association of Banks, the Hong Kong Association of Restricted Licence Banks and Deposit-taking Companies, and the Hong Kong S.A.R. Licensed Money Lenders Association Limited (collectively as the Industry Associations) made a joint announcement on the completion of the migration of consumer credit reference services to Credit Data Smart. The HKMA has been working closely with the Industry Associations to introduce more than one consumer credit reference agency (CRA) in Hong Kong, with a view to promoting the market competition of consumer credit reference services in Hong Kong, enhancing the service quality of consumer CRAs and reducing the operational risk of having only one commercially run service provider in the market, particularly the risk of single point of failure.
Date of Release: 25 Nov 2024
Implementation on: 25 Nov 2024
Applicable to: Credit Reference Services Market
Launch of Digital Bond Grant Scheme
The HKMA launched the Digital Bond Grant Scheme (DBGS). It aims to promote the development of the digital securities market and encourage broader adoption of tokenisation technology in capital market transactions.
Date of Release: 28 Nov 2024
Implementation on: 28 Nov 2024
Applicable to: Capital Market
Launch of HKUST's InvestLM Generative A.I. Platform
The HKMA announced the launch of the InvestLM Generative A.I. Platform by the School of Business and Management of The Hong Kong University of Science and Technology. This innovative platform aims to support the local financial services industry, particularly small-to-medium financial institutions, in harnessing the potential of Generative Artificial Intelligence technologies.
Date of Release: 28 Nov 2024
Implementation on: 28 Nov 2024
Applicable to: Financial Services Industry and Financial Institutions
New Supervisory Policy Manual (SPM) Module TM-C-1 on “Supervisory Approach on Cyber Risk Management”
The HKMA announced the issuance, by notice in the Gazette, of a new SPM module TM-C-1 on “Supervisory Approach on Cyber Risk Management” as a statutory guideline under section 7(3) of the Banking Ordinance. In light of the escalating cyber risks and the potential systemic impact of a severe cyber incident on financial stability, the HKMA considers it timely to articulate in a SPM module its policy, overarching principles and supervisory approach on banks for managing cyber risks. This SPM module is not intended to introduce any new requirements but sets out holistically the HKMA’s guidance and supervisory processes on cyber risk management as well as its expectation for deeper collaboration between the banking sector and other stakeholders in the ecosystem.
Date of Release: 29 Nov 2024
Implementation on: 29 Nov 2024
Applicable to: Banking Industry
Guidelines For Counterparty Credit Risk Management
The HKMA issued a circular to inform authorised institutions about the publication of Guidelines for counterparty credit risk management by the Basel Committee on Banking Supervision (BCBS). The key practices include (i) conducting comprehensive due diligence of counterparties both at initial onboarding and on an ongoing basis; (ii) developing a comprehensive credit risk mitigation strategy to effectively manage counterparty exposures; (iii) using a wide variety of complementary metrics to measure, control and limit CCR; and (iv) building a strong CCR governance framework. The HKMA will update its Supervisory Policy Manual module CR-G-13 “Counterparty Credit Risk Management” in due course to reflect the sound practices introduced by the guidelines.
Date of Release: 13 Dec 2024
Implementation on: Updates to SPM will be introduced in due course.
Applicable to: Authorised Institutions
Good Practices on Transition Planning
The HKMA issued a circular to highlight key observations and good practices on transition planning (as set out in Annex), based on the responses of Authorised Institutions (“AIs”) to a survey that the HKMA conducted in Q4 2023. The HKMA also announced that it is preparing a new Supervisory Policy Manual module GS-2 on “Transition Planning” to set out its expectations on how AIs should manage and address the risks associated with the net-zero transition, including expectations on how AIs should fulfill Goal #1 of the Action Agenda. The HKMA will consult the industry when the draft module is ready.
Date of Release: 16 Dec 2024
Implementation on: 16 Dec 2024
Applicable to: Authorised Institutions
Financial Market Co-operation between Hong Kong and the UAE
The HKMA announced that a Memorandum of Understanding (MOU) has been established between the HKMA and the CBUAE to strengthen and formalise their co-operation arrangements. Under the MOU, the two authorities have agreed to establish connectivity of the debt capital markets and the related financial market infrastructures between Hong Kong and the UAE with a view to facilitating cross-border debt securities issuance and investment activities.
Date of Release: 20 Dec 2024
Implementation on: 20 Dec 2024
Applicable to: Debt Capital Markets
- Hong Kong Exchanges and Clearing Limited (HKEX)
The Hong Kong Securities Clearing Company Limited, a wholly owned subsidiary of Hong Kong Exchanges and Clearing Limited, issued an information paper, which is published on HKEX website, to provide an overview of USM and explain the process for securities to participate in the USM regime. The USM regime seeks to remove the need for manual and paper-based processes, thereby enhancing operational efficiencies and elevating Hong Kong’s financial market infrastructure. Investors will have the capability to hold prescribed securities in their own names and in uncertificated form, thus granting them direct legal ownership of their securities electronically. This advancement will provide investors with improved shareholder protection and the convenience of managing their portfolios electronically.
Date of Release: 2 Oct 2024
Implementation on: Expected to be implemented by the end of 2025
Applicable to: Capital Market
The SEHK Options Clearing House Limited (“SEOCH”), a wholly owned subsidiary of Hong Kong Exchanges and Clearing Limited, issued a circular regarding amendments to the Options Clearing Rules (the “Rules”) and the Operational Clearing Procedures for Options Trading Exchange Participants (the “Procedures”) of SEOCH. The amendments to the Rules and Procedures are for the purpose of introducing weekly expiries for single stock options listed on The Stock Exchange of Hong Kong Limited.
Date of Release: 2 Oct 2024
Implementation on: 4 Nov 2024
Applicable to: SEOCH Participants and Options Trading Exchange Participants
The Stock Exchange of Hong Kong Limited, a wholly owned subsidiary of Hong Kong Exchanges and Clearing Limited, issued a circular in relation to the proposed enhancement of the settlement arrangement for Multi-counter Eligible Securities in Central Clearing and Settlement by adopting a single tranche multiple counters arrangement. Exchange Participants, along with their Clearing Participants (if applicable), are advised to review their internal systems and operation arrangements in order to ensure a smooth transition, including pre-trade checking, and to prevent any settlement failure.
Date of Release: 18 Oct 2024
Implementation on: June 2025 (tentative)
Applicable to: Exchange Participants
Digitalisation of ETP Servicing Capabilities with Online Platform
The HKEX announced its plans to digitise and automate the in-kind creation and redemption process for relevant exchange-traded products (ETP) in 2025 through the adoption of a web-based platform, subject to technical readiness and regulatory approval. This platform will be integrated into the ETP creation and redemption process, connecting key ETP participants with the use of Distributed Ledger Technology (DLT) and smart contracts, and will help increase overall ETP market efficiency, supporting the continued growth of secondary market activity for ETPs.
Date of Release: 5 Nov 2024
Implementation on: In 2025, subject to technical readiness and regulatory approval
Applicable to: Exchange-Traded Products
The Stock Exchange of Hong Kong Limited (the Exchange) issued a report (the Report) on the findings and recommendations of its annual review of issuers’ annual reports for the 2023 financial year end. In conjunction with the publication of the Report, the Exchange has published a Guide on Preparation of Annual Report (the Guide), which summarises prevailing recommendations from our previous reviews as well as all disclosure Rules applicable to annual reports, to facilitate issuers in preparing future annual reports.
Date of Release: 10 Dec 2024
Implementation on: 10 Dec 2024
Applicable to: Listed Issuers
Waiver of Stamp Duty on REITs Transactions
The Exchange issued a circular regarding the “Stamp Duty Legislation (Miscellaneous Amendments) Bill 2024” published by Government. The Amendment Ordinance relates to waiving the stamp duty payable on the transactions and transfers of shares or units of real estate investment trusts (REITs). EPs are reminded to prepare for the relevant amendment, including update their Broker Supplied Systems, back-office systems, relevant applications and operational facilities as necessary.
Date of Release: 11 Dec 2024
Implementation on: 21 Dec 2024
Applicable to: Real Estate Investment Trusts
Introduction of New Post-Trade Services on Orion Cash Platform
The HKEX announced that it is embarking on a multi-year post-trade services enhancement programme for its cash equities market, reflecting the Group’s ongoing commitment to build future-ready market infrastructure. Starting from mid-2025, new features will be progressively added to the Orion Cash Platform (OCP), HKEX’s integrated cash market platform, to provide more advanced, reliable and efficient post-trade services for the securities market. New features include automated post-trade report download and information exchange, as well as enabling real-time transmission and processing of trade data, related positions and reference data, and real-time matching of settlement instructions. As part of the enhancement programme, HKEX’s post-trade systems will become technically ready to support a T+1 settlement cycle by the end of 2025, though any future changes to Hong Kong’s settlement cycle will be subject to extensive market engagement.
Date of Release: 12 Dec 2024
Implementation on: Starting from mid-2025.
Applicable to: Cash Equities Market
Reduction of Minimum Spreads in Hong Kong Securities Market
The HKEX announced the conclusions to its Consultation Paper on the proposed reduction of minimum spreads in the Hong Kong securities market. Having carefully considered feedback from the consultation, HKEX will proceed with its proposal to reduce minimum spreads of the Applicable Securities in two phases (as indicated in the table). In order to provide adequate preparation time, Phase 1 will be implemented in mid-2025, while Phase 2 will be implemented in mid-2026, subject to a review of Phase 1’s results.
Date of Release: 17 Dec 2024
Implementation on: Phase 1 in mid-2025 and Phase 2 in mid-2026 (subject to review of Phase 1 results)
Applicable to: Securities Market
Launch of HKEX Data Marketplace
The HKEX announced the launch of the HKEX Data Marketplace, a web-based platform that offers data users a more intuitive experience in accessing HKEX’s historical and reference data. The new platform will feature a modern user interface with multiple data delivery channels including cloud transfer, providing data directly from HKEX to offer optimal user experience and convenience. In its initial stage, the HKEX Data Marketplace will offer shareholding data from the Central Clearing and Settlement System (CCASS) for commercial use, as well as historical full book data from HKEX’s securities and derivatives markets, and securities market daily non-trading reference data.
Date of Release: 18 Dec 2024
Implementation on: 18 Dec 2024
Applicable to: Capital Market
Amendments to the General Rules of HKSCC of Hong Kong Securities Clearing Company Limited
The HKSCC issued a circular regarding amendments to the General Rules of HKSCC (the “Rules”). Participants of HKSCC should note that the SFC has approved amendments to the Rules for the purpose of enabling HKSCC to act as liquidation agent for its affiliates who are recognised clearing houses in respect of eligible collateral comprising bonds in the China Interbank Bond Market which are traded via Bond Connect issued by the Ministry of Finance of the People’s Republic China or a policy bank.
Date of Release: 18 Dec 2024
Implementation on: 13 Jan 2025
Applicable to: Bond Market
- Insurance Authority (IA)
Study Notes for Insurance Intermediaries Qualifying Examination
The IA issued a circular to announce the publication of the Study Notes for the Principles and Practice of Insurance Examination (2024 Edition) and Study Notes for the Investment-linked Long Term Insurance Examination (2024 Edition) (“Study Notes”). The new edition reflects an update on the Guideline on Anti-Money Laundering and Counter-Terrorist Financing last revised by the IA. For examination sessions of the Principles and Practice of Insurance Examination and the Investment-linked Long Term Insurance Examination under IIQE to be conducted from 17 February 2025 onwards, the examination questions will be based on the new edition of Study Notes.
Date of Release: 18 Nov 2024
Implementation on: Examination questions from 17 Feb 2025 onwards will be based on the new edition of Study Notes.
Applicable to: Authorised Insurers, Licensed Insurance Agencies, and Licensed Insurance Broker Companies.
The IA published a revised Guideline on Cybersecurity (“GL20”), which introduces the Cyber Resilience Assessment Framework (“CRAF”). The CRAF provides prescriptive guidelines on risk assessment and control principles to assist authorised insurers in implementing their cybersecurity frameworks effectively.
Date of Release: 11 Dec 2024
Implementation on: 1 Jan 2025
Applicable to: Authorised Insurers
Guideline on Actuary’s Report of Investigation in respect of Long-Term Business
The IA published a new Guideline on Actuary’s Report of Investigation in respect of Long-Term Business (“GL35”). The GL35 sets out the IA’s expectation of the minimum scope and content of the actuary’s report of investigation in respect of long-term business, as required under section 18 of the Insurance Ordinance.
Date of Release: 20 Dec 2024
Implementation on: 31 Dec 2024
Applicable to: Authorised Insurers carrying on long term business.
- Financial Services and the Treasure Bureau (FSTB)
Strategic Collaboration between FSTB and Bloomberg to enhance Hong Kong's family office ecosystem
The FSTB announced the establishment of Hong Kong Family Office Nexus, a strategic collaboration between the FSTB and Bloomberg L.P. (Bloomberg) with the goal of attracting family offices from around the world to establish or expand their presence in Hong Kong and reinforcing the city's status as a leading global asset and wealth management hub. The partnership with Bloomberg will focus on four key pillars, namely community building, knowledge sharing, technology support and philanthropic collaboration. The FSTB, together with Invest Hong Kong (InvestHK) and the Hong Kong Academy for Wealth Legacy (HKAWL), will collaborate with Bloomberg on various initiatives to bolster Hong Kong's family office ecosystem.
Date of Release: 9 Oct 2024
Implementation on: As indicated per respective initiatives
Applicable to: Family Offices
Policy Statement on Responsible Application of Artificial Intelligence in Financial Market
The Government issued a policy statement on responsible application of artificial intelligence (AI) in the financial market, emphasising the need for a balanced approach that promotes AI adoption while addressing challenges like cybersecurity and data privacy. Financial institutions are encouraged to develop AI governance strategies and utilise available resources, including AI models from the Hong Kong University of Science and Technology, to enhance their operations responsibly. The Government will collaborate with financial regulators and industry players to foster a sustainable market environment and continuously update regulations to adapt to the evolving AI landscape.
Date of Release: 28 Oct 2024
Implementation on: 28 Oct 2024
Applicable to: Financial Industry
Companies (Amendment) Bill 2024
The Government published the Companies (Amendment) Bill 2024 (the Bill) in the Gazette. This amendment will enable listed companies incorporated in Hong Kong to hold shares bought back in the treasury and dispose of them and promote paperless corporate communication for both listed and unlisted Hong Kong companies. The Bill will be introduced into the Legislative Council for first reading on 4 Dec 2024.
Date of Release: 22 Nov 2024
Implementation on: To be introduced to the LegCo for first reading on 4 Dec 2024
Applicable to: Hong Kong Listed Companies
The Government published in the Gazette the Stablecoins Bill, which seeks to put in place a regulatory regime for issuers of fiat-referenced stablecoins (FRS) in Hong Kong. The Bill aims to enhance the regulatory framework for virtual asset (VA) activities, by addressing the potential financial stability risks posed by FRS, ensuring adequate user protection, and harnessing the potential benefits of VAs and their underlying technologies. The Bill will be introduced into the Legislative Council for first reading on 18 Dec 2024.
Date of Release: 6 Dec 2024
Implementation on: To be introduced to the LegCo for first reading on 18 Dec 2024
Applicable to: Fiat-Referenced Stablecoins
Roadmap on Sustainability Disclosure in Hong Kong
The Government launched a roadmap on sustainability disclosure in Hong Kong. The roadmap sets out Hong Kong's approach to require publicly accountable entities (PAEs) to adopt the International Financial Reporting Standards - Sustainability Disclosure Standards (ISSB Standards). It provides a well-defined pathway for large PAEs to fully adopt the ISSB Standards no later than 2028.
Date of Release: 10 Dec 2024
Implementation on: Expected to be fully adopted no later than 1 Jan 2028
Applicable to: Publicly Accountable Entities
Working Group on Promoting Gold Market Development
The Government announced that the Working Group on Promoting Gold Market Development has been established following the Chief Executive's announcement in the 2024 Policy Address to establish a working group under the FSTB to comprehensively review all aspects relating to the development of a gold market, take forward the establishment of an international gold trading centre, and formulate plans on enhancing the trading and regulatory mechanisms of the market.
Date of Release: 18 Dec 2024
Implementation on: 18 Dec 2024
Applicable to: Gold Market
Companies (Amendment) (No.2) Bill 2024
The Government published in the Gazette the Companies (Amendment) (No. 2) Bill 2024 (the Bill) to introduce a company re-domiciliation regime in Hong Kong. The Bill proposes to introduce a company re-domiciliation regime to enable non-Hong Kong-incorporated companies to re-domicile to Hong Kong while maintaining their legal identities as a body corporate and ensuring business continuity without the need to go through complicated and costly judicial procedures. The Bill will be introduced into the LegCo for first reading on 8 Jan 2025.
Date of Release: 20 Dec 2024
Implementation on: To be introduced to the LegCo for first reading on 8 Jan 2025.
Applicable to: Non-Hong Kong-incorporated Companies
Consultations
- Hong Kong Exchanges and Clearing Limited (HKEX)
Consultation Paper on Proposals to Optimise IPO Price Discovery and Open Market Requirements
The Exchange published a consultation paper seeking market feedback on proposals to optimise IPO price discovery and open market requirements (the Consultation Paper), ensuring its listing mechanism remains attractive and competitive for existing and prospective issuers. In particular, the Exchange proposes to: (1) Optimise the price discovery process for IPOs to increase the participation of “price setting” investors, thereby reducing the likelihood of the final offer price being set at a large disparity to the actual trading price when dealings in those shares commence; and (2) Review open market requirements, ensuring issuers will have sufficient shares in public hands that are available for trading at listing, whilst relaxing certain percentage thresholds which would imply a bar that may be too high in absolute dollar value.
Consultation Period: 19 Dec 2024 – 19 Mar 2025
Applicable to: Capital Market
This document is provided for information purposes only and does not constitute legal, tax, investment, regulatory, accounting or other professional advice. For more information on the legal and regulatory status of IQ-EQ companies please visit www.iqeq.com/legal-and-compliance.