SFC proposes to enhance asset management regulation and point-of-sale transparency

23 Nov 2016

The Securities and Futures Commission (SFC) today launched a three-month consultation on proposals to enhance the regulation of the asset management industry in Hong Kong to better protect investors’ interests and ensure market integrity.  

The SFC formulated the proposals following a review of the major international regulatory developments, and taking into account observations and views of industry stakeholders.   

"A robust and responsive regulatory regime is fundamental to the development and growth of an international asset management centre. As part of the SFC’s broader initiative to enhance Hong Kong’s position as a major international asset management centre, it is important to ensure that our regulations are properly benchmarked to evolving international standards,” said Mr Ashley Alder, the SFC’s Chief Executive Officer.

The proposed changes will be made to the SFC’s Fund Manager Code of Conduct (FMCC) and the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission (Code of Conduct). Details are set out in the consultation paper (Notes 1 & 2).

Interested parties are invited to submit their comments to the SFC on or before 22 February 2017 via the SFC website (www.sfc.hk), by email to amrconsultation@sfc.hk, by post or by fax to 2877 0318.



  1. The key areas of enhancements under the FMCC are in respect of securities lending and repurchase agreements, custody of fund assets, liquidity risk management, and disclosure of leverage by fund managers. 
  2. The proposed changes to the Code of Conduct aim to address the potential conflicts of interest in the sale of investment products and enhance disclosure at the point-of-sale by:

    (i) restricting an intermediary from representing itself as “independent” or using any term(s) with a similar inference if the intermediary receives commission or other monetary or non-monetary benefits or it has links or other legal or economic relationships with product issuers which are likely to impair its independence; and

    (ii) requiring an intermediary to disclose the range and maximum dollar amount of any monetary benefits received or receivable that are not quantifiable prior to or at the point of sale. 

Page last updated : 23 Nov 2016