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The Government announced that three sets of subsidiary legislation made under the Securities and Futures Ordinance (SFO) (Cap. 571) are gazetted today (December 6).
Among the subsidiary legislation gazetted is the Securities and Futures (Collective Investment Schemes) Notice made by the Financial Secretary, to continue existing arrangements for the Securities and Futures Commission (SFC) to regulate offer of "paper gold schemes" on commencement of the SFO.
The other two sets of subsidiary legislation are the Securities and Futures (Registration of Market Misconduct Tribunal Orders) Rules and the Securities and Futures (Registration of Appeals Tribunal Orders) Rules made by the Chief Justice, to provide for the manner in which the orders of the Market Misconduct Tribunal (MMT) and the Securities and Futures Appeals Tribunal (SFAT) are to be registered with the Court of First Instance for enforcement as necessary. The MMT and SFAT are to be established under the SFO.
The SFO was enacted in March 2002. It consolidates and modernizes 10 existing ordinances governing the securities and futures markets into a composite piece of legislation to keep the Hong Kong regulatory regime on a par with international standards and practices.
"For effective regulation, the SFO provides flexibility in addressing changing market practices and global conditions by empowering the SFC and relevant authorities to prescribe detailed and technical requirements as necessary by way of subsidiary legislation," a Government spokesman said.
"The subsidiary legislation seeks to supplement the regulatory framework laid down under the SFO."
The three sets of subsidiary legislation gazetted are amongst the 39 sets of subsidiary legislation that have to be in place for commencing the SFO.
The three sets of subsidiary legislation will come into force on commencement of the SFO. "An announcement of the target commencement date of the SFO will be made by the end of 2002," the spokesman said.
"A reasonable period of time will be allowed for the industry to make necessary adjustments to their operation systems with reference to the subsidiary legislation," he added.
Major features of the three sets of subsidiary legislation gazetted are set out in the Annex.
Annex
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Securities and Futures (Collective Investment Schemes) Notice
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- The Notice prescribes the arrangements for the purchase of gold coins or gold bullion with certain specified characteristics as "collective investment schemes". Such schemes are commonly known as "paper gold schemes". The effect of the Notice is that any person who offers such "paper gold schemes" to the public is required to obtain prior authorization from the Securities and Futures Commission (SFC).
Securities and Futures (Registration of Market Misconduct Tribunal Orders) Rules
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- The Market Misconduct Tribunal (MMT) is an independent full-time body, chaired by a Judge, set up under the SFO to deal with a range of market misconduct through civil proceedings and sanctions.
- The MMT is empowered to make orders in relation to the conduct of its proceedings. It may also impose by order a range of civil sanctions on a person identified as having engaged in market misconduct.
- The Rules prescribe the manner in which the MMT is to give notice to the Court of First Instance in respect of registration of its orders so that the orders may be enforced as if they are an order of the Court of First Instance.
Securities and Futures (Registration of Appeals Tribunal Orders) Rules
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- The Rules supplement the operation of the Securities and Futures Appeals Tribunal (SFAT). The Tribunal is an independent full-time body established under the SFO, chaired by a Judge, which may review, on application, the merits of a range of regulatory decisions made by relevant regulatory authorities including the SFC and the Hong Kong Monetary Authority. The SFAT is empowered to make a range of orders under the SFO in relation to its review proceedings.
- The Rules prescribe the manner in which the SFAT is to give notice to the Court of First Instance in respect of registration of its orders so that the orders may be enforced as if they are orders of the Court of First Instance.
End/Friday, December 6, 2002
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