The Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) today issued a joint consultation on standardising the calculation periods (Note 1) for each year under the Clearing Rules (Note 2) for the over-the-counter (OTC) derivatives regulatory regime.
Under the current approach that requires the central clearing of OTC derivative transactions, the existing list of calculation periods specified in the Clearing Rules needs to be updated regularly. In a move to further increase the efficiency of the operation of the Clearing Rules, the SFC and the HKMA propose to designate, once and for all, standard calculation periods for each year with effect from 1 March 2027 (Note 3).
As part of the regulators’ ongoing efforts to enhance the OTC derivatives regulatory regime in Hong Kong, the proposed change would also offer greater certainty to derivative dealers in identifying future calculation periods to ensure compliance.
Interested parties are invited to submit comments to the SFC or HKMA by 27 February 2026. The joint consultation paper can be downloaded from the SFC or HKMA websites.
Notes:
- Under the Clearing Rules, a calculation period is used to determine whether a person is subject to mandatory clearing obligation, based on the size of its applicable position in OTC derivative transactions for a calculation period as calculated in accordance with the Clearing Rules.
- The Securities and Futures (OTC Derivative Transactions – Clearing and Record Keeping Obligations and Designation of Central Counterparties) Rules.
- Under the proposed approach to be effective from 1 March 2027 onwards, the Clearing Rules will be amended to designate two calendar periods, ie, 1 March to 31 May and 1 September to 30 November, in each year as calculation periods.
