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To explain the Securities anld Futures Commission of Hong Kong’s new FAQs on external electronic data storage.

The article analyses the existing legal and regulatory requirements relating to the keeping of records as well as the circular and FAQs on the use of external electronic data storage. It also discusses the practical implications of the newly added FAQs.

The SFC has relaxed the requirement as regards the appointment of two Managers-In-Charge in Hong Kong for the purposes of the circular on the use of external electronic data storage. The SFC has offered more flexibility with respect to the undertaking by electronic data storage providers in the FAQs. The FAQs have also provided more certainty with respect to the approval requirements pursuant to section 130 of the SFO where non-Hong Kong affiliates are concerned.

The additional guidance from the SFC regarding external electronic data storage in the form of the new FAQs shows a helpful clarification in the SFC’s approach on the practical implementation of the relevant requirements under the circular on the use of external electronic data storage.

The article offers practical guidance in respect of the implications of the newly added FAQs on the external electronic data storage regime from experienced financial services and asset management lawyers.

To provide an overview of the Hong Kong regulatory regime for crypto-related investment products.

Describes the existing regulatory regime in Hong Kong for crypto-related investment products prior to November 2018 and, following circulars issued by the Hong Kong Securities and Futures Commission (SFC) in November 2018, regulatory standards relating to virtual asset portfolio managers and fund distributors and a conceptual framework for potential regulation of virtual asset trading platform operators. Discusses the implications of the regulatory standards and conceptual framework.

The regulatory standards have aligned the requirements relating to crypto-related securities and futures contracts with those for crypto-related assets that do not fall within such definitions. The opt-in approach under the conceptual framework demonstrates that the SFC is actively trying to learn about the operations of platform operators and develop appropriate regulations accordingly.

Practical guidance from experienced lawyer with expertise in fund formation, fund investments and retail fund registration

To examine the nine common areas of non-compliance in managing investment funds and discretionary accounts, detailed in a Hong Kong Securities and Futures Commission (SFC) circular dated September 15, 2017, directed at SFC-licensed asset managers.

Discusses a July 2017 circular indicating the SFC’s general concerns and analyzing the following nine common areas of non-compliance cited in the September 15, 2017 circular: (1) inappropriate receipt of cash rebates giving rise to apparent conflicts of interests, (2) failure to follow investment-suitability and discretionary account mandates during solicitation, (3) failure to implement liquidity-risk management processes, (4) deficiencies in governance structures and fair-valuation procedures, (5) deficiencies in systems for ensuring best execution, (6) failure to safeguard fair order allocation, (7) inadequate controls for protection of client assets, (8) inadequate systems to comply with investment restrictions, and (9) inadequate safeguards to address market misconduct risk.

The nine examples of non-compliance provide a useful insight into key “problem areas” indicated to currently be of particular concern to the SFC.

All SFC-licensed asset managers would be well advised to revisit their internal governance structures and operational policies and procedures in order to ensure that they are compliant with applicable standards and requirements.

Practical guidance from a lawyer with extensive experience advising investment managers and advisers, fund administrators, trustees and other fund service providers on investment fund-related issues.

The purpose of this paper is to draw attention to the Hong Kong Securities and Futures Commission (SFC) Consultation Paper on Proposals to Enhance Protection for the Investing Public, issued on September 23, 2009, and some of the key issues that financial services providers operating in or dealing with the Hong Kong market will need to consider.

The paper explains the purpose of the Consultation Paper and summarizes its proposals in three subject categories: retail products offered to the public in Hong Kong, intermediares’ conduct, and post‐sale arrangements and cooling‐off periods.

The paper finds that the SFC's overall intention is to enhance Hong Kong's existing regulatory regime for the sale of retail investment products.

The Consultation Paper addresses a significant number of wide ranging proposals that could have a material effect on those issuing and distributing retail investment products to the Hong Kong public, whether from inside or outside Hong Kong.

The paper provides practical guidance from experienced securities and financial institution lawyers.

This study explores the interrelationship between regulatory risks and strategic controls within the financial supervision architecture of an emergent global financial centre of China that embraces innovation as part of its strategic objectives.

This paper employs a longitudinal case study approach to examine the institutional dynamics of the key financial regulators in connection with the regulated financial institutions in Hong Kong before and after the financial tsunami of 2008.

First, this study reveals an organic development of a specialised financial regulatory architecture that resists transforming itself structurally despite the significant impact of externalities. Second, in this post-financial crisis analysis, regulated financial institutions swiftly respond by strengthening their risk controls through compliance with the guidelines imposed by the regulator. Institutional dynamics in influencing the implementation of risk controls through a top-down interactive mechanism are observed. Such dynamic and pertinent rapid responses induce the pursuit of optimal risk management within a regulatory framework.

This paper provides a longitudinal case study to reveal regulatory risks and strategic controls of the global financial centre of China. It unveils mitigating risk control measures in the aftermath of the global financial crisis. The study demonstrates how regulatory institutions strive to take precautionary, coercive measures such that the regulated institutions mimic and implement prudent mechanisms.

The integrity of the financial markets in the Hong Kong Special Administrative Region (Hong Kong) is maintained by an approach which involves cooperation between government, the banking sector, the Hong Kong Monetary Authority (the HKMA), the Securities and Futures Commission (the SFC) and the industry itself.

The purpose of this paper is to discuss the new “Guidance Note on Cooperation with the SFC” released by the Hong Kong Securities and Futures Commission (“SFC”) on 12 December 2017, which updates the SFC’s previous guidance note issued in 2006.

This paper explains key features to the guidance note, the SFC’s current approach in investigations and enforcement and the impact on regulated parties and senior management. In particular, the authors discuss what cooperation means in disciplinary, civil court and market misconduct tribunal proceedings.

The new guidance note confirms that the SFC will play an increasingly active role in investigations and that taking proactive steps at an early stage, including involving senior management, will have a positive impact on the outcome of the investigation.

Commentary and practical guidance from experienced securities enforcement and financial services regulatory enforcement lawyers.

The purpose of this paper is to provide an overview of a recent Court of Appeal case regarding the Securities and Futures Commission’s (SFC’s) powers to seek remedial orders with respect to market misconduct.

This paper summarises the decision of the Court of First Instance and the judgement on appeal to the Court of Appeal, and the practical implications for financial institutions in preventing and detecting the disclosure and use of confidential material price-sensitive information.

The Court of Appeal’s decision reconfirms the extensive powers of the SFC to pursue conduct involving insider dealing, including where this involves trading in overseas-listed shares and a substantial measure of the elements of the offence that occurred in Hong Kong. The decision also affirms the breadth of the SFC’s powers to seek remedial orders against anyone involved in such offences, even where the person is unaware of the particular contravention.

Organisations should ensure they have adequate systems and controls established to prevent and detect the disclosure or use by employees of confidential material price-sensitive information, including strong information barriers. Insider dealing policies should also expressly cover both Hong Kong and overseas-listed securities, and employees should be given regular training to ensure that they are aware of their obligations with respect to such inside information.

This paper presents a summary that assesses developments in the case of law regarding the SFC’s powers to pursue remedial orders by experienced contentious regulatory lawyers.

To discuss likely trends in the enforcement activities of the Securities and Futures Commission (SFC) in Hong Kong and to explore key areas of focus and what impact they may have on Hong Kong companies.

Discusses the SFC’s most important current areas of focus, the need for cooperation with other regulators such as those in mainland China, and a recent increase in disclosure obligations for listed companies.

The SFC’s principal areas of focus are currently corporate fraud and malfeasance, market manipulation, and intermediary misconduct.

Expert guidance from experienced commercial and corporate lawyers.