The Securities and Futures Commission (SFC) today published its latest Quarterly Report which summarises key developments from October to December 2019.
Highlights of the quarter included the launch of a consultation on proposed changes to the open-ended fund companies regime to encourage more private funds to set up in Hong Kong and the release of a position paper setting out a new licensing framework for virtual asset trading platforms.
The SFC also published consultation conclusions on enhancements to the investor compensation regime which raised the compensation limit to $500,000 per investor per default and on proposals to impose margin requirements for non-centrally cleared over-the-counter derivatives to help reduce systemic market risks.
As part of ongoing efforts to address corporate misconduct, the SFC issued a statement in November to remind listed companies not to disclose false, incomplete or misleading information about their counterparties in a transaction, together with a circular reminding asset managers to properly assess potentially dubious arrangements and transactions involving private funds or discretionary accounts which are proposed or directed by investors.
A report published by the SFC in December shared the findings of its survey on integrating environmental, social and governance factors and climate risks in asset management.
Key figures for the quarter include:
- The number of licensees and registrants rose 2.3% from last year to 47,437, including the number of licensed corporations, which grew 6.2% to 3,084.
- The SFC conducted 76 on-site inspections of licensed corporations to review their compliance with regulatory requirements.
- The SFC authorised 50 unit trusts and mutual funds and 18 unlisted structured investment products for public offering.
- 51 new listing applications were vetted.
- In reviewing corporate disclosure, the SFC issued section 179 directions to gather additional information in 14 cases and wrote to detail its concerns in six transactions (Note 1).
- It made 2,345 requests to intermediaries for trading and account records triggered by untoward price and turnover movements.
- Five licensed corporations and five individuals were disciplined, resulting in total fines of $413.3 million.
The report is available on the SFC website.
Note:
- Section 179 of the Securities and Futures Ordinance gives the SFC the power to compel the production of records and documents from persons related to a listed company.
