Hong Kong beefs up regulation
With a new Memorandum of Understanding between the Securities and Futures Commission and the Hong Kong Monetary Authority, the level of cooperation has increased significantly. Whilst still falling a long way short of a unified regulator, the two will work much more closely and will seek to put in place measures that have considerable commonality.
With a new Memorandum of Understanding between the Securities and Futures Commission and the Hong Kong Monetary Authority, the level of cooperation has increased significantly. Whilst still falling a long way short of a unified regulator, the two will work much more closely and will seek to put in place measures that have considerable commonality.
The two say "this is a significant milestone in the preparation for the new regulatory regime under the Securities and Futures Ordinance (SFO) and the Banking (Amendment) Ordinance 2002."
Under the Securities and Futures Ordinance, authorized institutions under the Banking Ordinance will no longer be exempt from regulation in relation to dealing in and advising on securities. Instead of being exempt dealers under the current legislation, they will be required to seek registration from the SFC in order to carry out the regulated activities concerned.
In that regard, the criteria adopted in determining whether authorized institutions are fit and proper for the purpose of registration will be consistent with those adopted in considering applications for the grant of licences to stockbrokers. In addition, the relevant employees of registered institutions will be required to meet the same competence and continuous professional training requirements as for SFC licensed representatives.
Under the new regulatory regime, registered institutions and their relevant employees will be formally subject to the various rules, codes of business conduct and guidelines issued by the SFC. They will also be subject to the same disciplinary measures in case of misconduct as those applicable to SFC licensees.
This MOU will replace the existing one which was signed in October 1995. It will be effective on 1 April 2003, the day to be appointed for the commencement of the Securities and Futures Ordinance.
A copy of the MOU is at World Money Laundering Report: Resources
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