SFC consults on new OFC Rules and OFC Code

28 Jun 2017

The Securities and Futures Commission (SFC) today launched a two-month consultation on the detailed legal and regulatory requirements applicable to the new open-ended fund company (OFC) structure (Note 1). The OFC structure will enable investment funds to be established in corporate form in Hong Kong, in addition to the current unit trust form.

The consultation sets out the SFC’s proposed Securities and Futures (Open-ended Fund Companies) Rules (OFC Rules) and Code on Open-ended Fund Companies (OFC Code), which include requirements relating to the OFC’s formation, its key operators, ongoing maintenance, termination and winding-up, and will be applicable to all OFCs (Note 2).

“The introduction of the OFC vehicle is part of our initiatives to develop Hong Kong as a full-service international asset management centre,” said Mr Ashley Alder, the SFC’s Chief Executive Officer. “The new fund structure will accelerate the development of Hong Kong’s asset management industry and enhance Hong Kong’s position as a preferred fund domicile,” he added.

In preparing the proposed OFC Rules and OFC Code, the SFC took into account comments received during the Government’s public consultation on the OFC framework (Note 3) and the views of industry stakeholders, as well as international regulatory standards and local company laws. Implementation of the new OFC regime is envisaged in 2018 following the conclusion of the consultation and completion of the legislative process.

The public is invited to submit their comments to the SFC on or before 28 August 2017 via the SFC website (www.sfc.hk), by email to ofc-consultation@sfc.hk, by post or by fax to 2877 0318.



  1. The Securities and Futures (Amendment) Ordinance 2016, gazetted on 10 June 2016, provides a legal framework for OFCs in Hong Kong. Under this framework, all OFCs will be required to be registered with the SFC as the primary regulator.
  2. The Securities and Futures (Amendment) Ordinance 2016 empowers the SFC to make subsidiary legislation and issue codes and guidelines in relation to the regulation of OFCs. OFCs which are intended to be offered to the public will have to obtain the SFC’s authorisation under Part IV of the Securities and Futures Ordinance unless an exemption applies. Accordingly, publicly-offered OFCs will also be subject to the authorisation and ongoing post-authorisation requirements set out in the SFC Handbook for Unit Trusts and Mutual Funds, Investment-Linked Assurance Schemes and Unlisted Structured Investment Products.
  3. The Financial Services and the Treasury Bureau (FSTB) conducted a public consultation on the legal and regulatory framework for OFCs. The consultation paper was released in March 2014 and consultation conclusions were issued in January 2016.  Both the consultation paper and consultation conclusions paper are accessible on the FSTB’s website. 

Page last updated : 28 Jun 2017