The Securities and Futures Commission (SFC) today published its Quarterly Report summarising key developments from April to June 2018.
During the quarter, the SFC released consultation conclusions on the rules and regulations for the new open-ended fund companies regime, which enables investment funds to be established in corporate form in Hong Kong. The new regime came into effect on 30 July.
The SFC also concluded a consultation on amendments to the takeovers rules, including to increase the threshold for independent shareholder approval of a whitewash waiver to 75% to enhance investor protection. Separate consultation conclusions on the rules standardising the prescription of professional investors and disclosure requirements for intermediaries providing discretionary account management services were also published during the quarter.
In addition, consultations were launched on proposals to enhance the investor compensation regime and proposed margin requirements for non-centrally cleared over-the-counter derivatives transactions.
The SFC hosted its Compliance Forum in June to exchange views with the industry on current regulatory issues, including sponsor work on initial public offerings and the use and associated risks of innovative technologies.
A fourfold increase in the daily quotas for both the northbound and southbound trading links under Mainland-Hong Kong Stock Connect took effect on 1 May following a joint announcement by the SFC and the China Securities Regulatory Commission.
In enforcement, Citigroup Global Markets Asia Limited was reprimanded and fined $57 million for failings in its sponsor work on the listing application of Real Gold Mining Limited.
Key figures from the report include the following:
- The number of licensees and registrants reached 45,099, up 4.4% year-on-year, and the number of licensed corporations increased 8.9% to 2,775. Both were record highs.
- A total of 65 on-site inspections of licensed corporations were conducted to review their compliance with regulatory requirements.
- The SFC reviewed 124 new listing applications, up 69.9% from the previous quarter.
- The SFC made 2,152 requests for trading and account records from intermediaries triggered by untoward price and turnover movement.
The report is available on the SFC website.