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The Securities and Futures Ordinance (Amendment of Schedule 5) Notice 2005 (Amendment Notice) will be published in the Government Gazette on Friday (November 11). The Amendment Notice is made by the Financial Secretary pursuant to section 142 of the Securities and Futures Ordinance (Cap. 571) (SFO).
"The Amendment Notice seeks to amend the definitions of some of the regulated activities under Part 2 of Schedule 5 to the SFO in order to keep up with the development of the securities and futures industry and in light of comments received from market participants and industry associations," a Government spokesman said today (November 9).
Schedule 5 to the SFO sets out nine types of activities (Note) regulated by the Securities and Futures Commission (SFC) and the related definitions concerning the licensing and registration matters of those regulated activities. In the light of market development, the following amendments will be made:-
(a) To amend the definitions of "advising on securities" and "advising on futures contracts" (i.e. Types 4 and 5 regulated activities) so that the giving of advice by a licensed asset manager, solely for the purposes of carrying on fund management activities pertaining to collective investment schemes under his management, is to be excluded from the definitions;
(b) To amend the definition of "dealing in securities" (i.e. Type 1 regulated activity) to carve out dealings in securities made by an approved money broker within the meaning of section 2(1) of the Banking Ordinance (Cap. 155) when the transaction is conducted on behalf of authorised financial institutions; and
(c) To amend the definition of "asset management" (i.e. Type 9 regulated activity) to explicitly include real estate investment scheme management.
"The Securities and Futures Commission conducted a public consultation in February this year, and the majority of the respondents were supportive of the proposed amendments," the spokesman said.
"The proposed amendments will allow the regulatory regime to keep pace with the latest developments in the securities and futures industry, and hence will be conducive to the growth of the industry."
The Amendment Notice will be tabled at the Legislative Council (Legco) for negative vetting on November 16. Subject to Legco's negative vetting, the Amendment Notice will commence operation on January 6, 2006.
Note: The nine types of regulated activities are (1) dealing in securities, (2) dealing in futures contracts, (3) leveraged foreign exchange trading, (4) advising on securities, (5) advising on futures contracts, (6) advising on corporate finance, (7) providing automated trading services, (8) securities margin financing, and (9) asset management.
Ends/Wednesday, November 9, 2005
Issued at HKT 16:18
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