SFC provides licensing guidance for private equity firms and family offices

7 Jan 2020



The Securities and Futures Commission (SFC) today issued guidance on the licensing obligations of private equity (PE) firms and family offices which conduct business in Hong Kong.

In a circular to PE firms seeking to be licensed, the SFC provides more information about the licensing requirements for PE firms’ general partners, investment committee members and fund marketing activities. The circular also clarifies how the SFC assesses PE firms’ discretionary investment authority and investments in securities of private companies as well as the industry experience requirement for their responsible officers (Note 1).

A separate circular discusses how the SFC’s licensing regime applies to family offices intending to carry out asset management or other services in Hong Kong and explains the potential implications for both single and multi-family offices. Licensing exemptions, or carve-outs (Note 2), may be available depending on how a family office operates.

"PE firms and family offices are two key building blocks of any leading asset and wealth management centre," said Mr Ashley Alder, the SFC’s Chief Executive Officer. "Our two circulars clarify how our licensing obligations apply to the activities of these firms in Hong Kong."

The circulars were issued in response to enquiries from industry participants and their professional advisers. Interested parties are encouraged to approach the SFC to discuss their business plans or seek further clarification (Note 3).

End

Notes:

  1. Please also see paragraphs 1.4.18 and 1.4.19 of the SFC’s Licensing Handbook for further guidance on private equity and venture capital firms.
  2. Paragraph 1.3 of the Licensing Handbook provides general guidance on some situations in which licensing exemptions may apply under the Securities and Futures Ordinance. 
  3. Enquiries about the licensing requirements for PE firms may be sent to enquiry.pefirm@sfc.hk and those related to family offices to enquiry.familyoffice@sfc.hk.

 



Page last updated : 7 Jan 2020