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The Securities and Futures Commission (SFC) today published its Annual Report 2015-16 summarising its work during a year which saw high levels of market volatility as well as greater connectivity with markets in mainland China.
The report details regulatory enhancements currently underway which are directed to market efficiency, competitiveness and orderliness. These include conducting a joint review of the listing structure with Hong Kong Exchanges and Clearing Limited and a listing thematic review, as well as developing an asset management strategy for Hong Kong. Other ongoing initiatives include clarifying the requirement to ensure the suitability of investment products for clients across different intermediary business models and implementing the second phase of the over-the-counter derivatives regime.
"Regulation is the cornerstone of Hong Kong’s position as a leading international financial centre," said Mr Carlson Tong, the SFC's Chairman. "Our priority is to promote the soundness and competitiveness of our financial markets. We must ensure that our regulatory regime can operate well in an unpredictable environment."
"We keep an open mind to new proposals and reforms that promote market development provided that they are consistent with the protection of investor interests and rest on sound regulatory principles," emphasised Mr Ashley Alder, the SFC’s Chief Executive Officer. "Hong Kong’s traditional role is as a place where the world interacts with a rapidly changing China, and further capital market integration is clearly the future. This lays the groundwork for Hong Kong to further develop as a centre for managing Mainland risk."
During the year, the SFC deepened cooperation with the China Securities Regulatory Commission and other regulatory counterparts to ensure that high standards of regulation support the long-term development of new cross-boundary schemes, including Mainland-Hong Kong Mutual Recognition of Funds (MRF).
The SFC also seeks to intensify its participation in global regulatory initiatives through Mr Alder's chairmanship of the Board of the International Organization of Securities Commissions.
Other highlights of the SFC’s operations featured in the report:
- Handled 7,975 licence applications, up 13% year-on-year, as the total number of SFC licensees increased to over 41,000
- Authorized 158 collective investment schemes for public offering, including Mainland funds under the MRF scheme, and implemented a streamlined fund authorization process
- Reviewed 218 listing applications under the dual filing regime, up 33% year-on-year, and raised 142 enquiries with listed companies
- Supervised 435 takeovers-related transactions and applications
- Conducted 306 risk-based, on-site inspections of intermediaries
- Made 7,997 requests for trading and account records from intermediaries as a result of our market surveillance work
- Took disciplinary action against 41 licensed corporations and individuals with total fines amounting to $87.1 million
An online version of the Annual Report is available on the SFC's website.
