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Clifford Chance

Clifford Chance


HKMA and SFC Consultation Conclusions pave way for mandatory reporting of OTC derivatives in Hong Kong in 2015

3 December 2014

The Hong Kong Monetary Authority ("HKMA") and the Securities and Futures Commission ("SFC") released their consultation conclusions (the "Consultation Conclusions")  in relation to the proposed reporting and record keeping rules ("Rules") in respect of OTC derivative transactions.  In a welcome development for the fund management industry and end users, the HKMA and SFC have decided to adopt a phased approach to the introduction of mandatory reporting of OTC derivatives in Hong Kong, with dealers being the first category of market participants to be subject to the reporting requirements. The revised Rules applicable to dealers are expected to come into effect in the first quarter of 2015, with a six month grace period before mandatory reporting commences.

The regulators have made a number of amendments to the Rules after consideration of market feedback, such as an extension of the grace period, clarification of the product scope and broadening the availability of data masking. This client briefing sets out our main observations on the revised Rules contained in the Consultation Conclusions, and highlights the key developments that market participants should be aware of for 2015.

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