Clifford Chance
SFC further consults on proposed regulatory regime for depositaries of Hong Kong public funds
10 March 2022
In 2019, the Securities and Futures Commission ("SFC") launched a consultation to propose a new Type 13 regulated activity ("RA13") to put trustees and custodians of Hong Kong public funds under the SFC’s direct supervision. On 22 February 2022 the SFC published its conclusions and started further consultation on proposed amendments to subsidiary legislation, codes and guidelines to implement the regime.
The new RA13 regulatory framework was proposed by the SFC to enhance the regulation of how trustees and custodians ("depositaries") safeguard scheme assets and oversee scheme operations for Hong Kong public funds, which until now not directly regulated by the SFC. Noting that many major overseas regulators such as the UK, Singapore and Australia have already put in place a direct regulatory handle over entities which provide trustee, custodial or depositary services for, at a minimum, public funds since the global financial crisis, the proposal forms part of the SFC’s efforts to develop Hong Kong as an international, full-service asset management centre that is comparable with other key international markets.
Part I of this briefing sets out the key responses provided by the SFC to address the comments received during the 2019 Consultation. Part II discusses the subject matters further consulted by the SFC to implement the RA13 regime.
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