Following is a question by the Hon Robert Lee and a written reply by the Secretary for Financial Services and the Treasury, Mr Christopher Hui, in the Legislative Council today (July 8):

Question:

     The National 15th Five-Year Plan clearly supports Hong Kong in strengthening its functions as an international asset and wealth management centre. There are views that there is room for further improvement in the Mainland-Hong Kong Mutual Recognition of Funds arrangement, operation of the Integrated Fund Platform under the Hong Kong Exchanges and Clearing Limited (HKEX), as well as the sales and promotion arrangements under the Cross-boundary Wealth Management Connect (Cross-boundary WMC) Scheme in the Guangdong-Hong Kong-Macao Greater Bay Area, in order to facilitate development of the asset and wealth management industry in Hong Kong. In this connection, will the Government inform this Council:

(1) whether the Government will step up negotiations with the Mainland regulatory authorities to further increase the number of funds mutually recognised between the Mainland and Hong Kong, so as to cover all funds authorised by the Securities and Futures Commission (SFC);

(2) whether it will study the establishment of a dedicated committee and engagement of industry players to jointly review and enhance the operation of HKEX's Integrated Fund Platform; and urge HKEX to expedite expansion of the services provided by the Platform to include one-stop services such as fund trading (including funds authorised by SFC), settlement and analysis;

(3) given that the Hong Kong Monetary Authority introduced enhancement measures for the Cross-boundary WMC Scheme last year, including the establishment of the "Three-party Online Conference", to facilitate promotion and sales efforts under the Southbound Scheme, whether the Government will, against this background, further discuss with the Mainland authorities the implementation of relaxation measures to allow financial services practitioners in the Mainland and Hong Kong to have direct mutual market access under a system of mutual recognition of licenses so that they can conduct offline product sales and promotion with physical presence in both markets;

(4) whether it will explore with the Mainland further expansion of the scope of investment products under the Cross-boundary WMC Scheme and the enhancement of efficiency of the relevant approval process; and whether it will consider enhancing the relevant measures under the Cross-boundary WMC Scheme to encourage Mainland securities dealers to collaborate with more securities dealers in Hong Kong; if so, of the details; and

(5) given that the Pilot Programme to Enhance Talent Training for the Asset and Wealth Management Sector had concluded at the end of March this year, whether the Government will consider relaunching and regularising the Programme, with a view to continuously nurturing more relevant talents to address the development needs of the industry?

Reply:

President,

     The National 15th Five-Year Plan clearly supports strengthening Hong Kong's functions as an international asset and wealth management centre. The Government has been working in concert with the financial industry to continuously improve the financial infrastructure and ecosystem, enrich investment products and risk management tools, and deepen the mutual access with capital markets of different places. These measures have been bearing fruit. According to the Asset and Wealth Management Activities Survey 2025 just published by the Securities and Futures Commission (SFC), Hong Kong's assets under management in 2025 jumped 20 per cent year-on-year to a record high of $42.2 trillion, with net fund inflow surging 193 per cent year-on-year to $2.1 trillion. In addition, Hong Kong has become the world's largest cross-boundary wealth management centre and it is projected that, from 2025 to 2030, the cross-boundary wealth managed by Hong Kong will grow by 9 per cent on average annually, maintaining first place globally. To maintain the strong growth momentum, the Government recently introduced a bill to the Legislative Council on June 24 for further enhancing the preferential tax regimes for funds, single family offices and carried interest, with a view to attracting more global capital to be managed in Hong Kong.

     In consultation with the SFC, the Hong Kong Monetary Authority and the Hong Kong Exchanges and Clearing Limited (HKEX), the reply to the various parts of the question is as follows:

(1) The Government is committed to enhancing the mutual market access mechanism with the Mainland. The Mainland-Hong Kong Mutual Recognition of Funds arrangement (the Arrangement) was launched in July 2015, where eligible Mainland and Hong Kong funds can be offered to retail investors in each other's market through a streamlined vetting process. The regulators of the two places implemented enhancement measures starting from January 1, 2025, which include relaxing the sales restriction of mutual recognition funds in the other market and allowing Hong Kong mutual recognition funds (i.e. Hong Kong funds authorised to be offered in the Mainland market) to delegate investment management functions to overseas asset management companies within the same group. The measures enhanced the flexibility and scale of the Arrangement, where a total of 85 funds were authorised by the regulators of the two places as of end-May 2026. In 2025, the net subscription amount of Hong Kong mutual recognition funds on the Mainland reached RMB82.5 billion, representing a 2.3-fold increase year-on-year.

     The SFC has been maintaining close communication with local fund managers to encourage them to actively participate in the Arrangement, having regard to factors such as their business development plans. The Government and regulators will continue discussions with Mainland counterparts on different enhancement measures for the mutual market access mechanism to support market development.

(2) The Integrated Fund Platform (IFP) established by HKEX has been well received by the fund industry since its launch. The IFP introduced earlier the "Fund Repository" providing a one-stop information portal for investors to access key details on funds authorised by the SFC, as well as the "Order Routing Service" enhancing connectivity between market participants of all sizes across the fund value chain to elevate operational efficiencies in fund distribution. As at end-May 2026, the IFP has successfully attracted 55 financial institutions, including fund houses, distributors and transfer agents.

     The IFP is expected to launch the "Platform and Nominee Services" in the second half of 2026, expanding its services to include the provision of nominee services, as well as the facilitation of payments and settlement, so as to enhance market efficiency and lower transaction costs. During the planning, preparation and operation of the IFP, HKEX as always will continue to maintain close communication with regulators and industry stakeholders to enhance the efficiency of the IFP and promote broader industry participation in the platform.

(3) and (4) Cross-boundary Wealth Management Connect (WMC) in the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) provides GBA residents with a formal, direct and convenient channel for cross-boundary investment in diverse wealth management products and marks a milestone in the financial development of the GBA.

     Regarding mutual recognition of professional qualifications with the Mainland, for the securities and futures sector, the SFC and the China Securities Regulatory Commission have implemented an arrangement for mutual recognition of professional qualifications, and simplified the relevant procedures for obtaining securities practising registration and applying for the futures or fund practising qualifications on the Mainland. Hong Kong professionals with relevant licence issued by the SFC only need to pass the Mainland's examination on the relevant laws and regulations; the examination on the foundation paper is not required. For the banking sector, the Hong Kong Institute of Bankers and the China Banking Association signed the Memorandum of Understanding on Mutual Recognition of Personal Wealth Management Qualification Certificates (MoU) in 2009, officially launching the mutual recognition mechanism. Subsequently, the two sides signed addendums in 2010, 2015 and 2022 to improve the relevant arrangements. Under the MoU, financial practitioners from the Mainland and Hong Kong can obtain "dual qualifications" (Level 1 of Qualification Certificate of Banking Professional in the Mainland and the Associate Retail Wealth Professional in Hong Kong) through the mutual recognition mechanism. Hong Kong will continue to examine enhancement measures with Mainland regulators to explore ways of broadening Hong Kong professionals' entry into the Mainland market, thereby increasing the flexibility in the provision of human capital for the Mainland and Hong Kong markets.

     As an innovative financial co-operation measure in the GBA involving three different regulatory systems of the Mainland, Hong Kong and Macao, the WMC has been implemented under a pilot approach in a gradual and incremental manner. Under the current regulations on the Mainland, Mainland brokers are already allowed to collaborate with multiple Hong Kong brokers to participate in the WMC. Regarding the product scope, "WMC 2.0" has also scoped in (1) all non-complex funds domiciled in Hong Kong, authorised by the SFC and primarily investing in Greater China equity (with no limitation on risk ratings), (2) other low- to medium-high-risk funds (excluding single emerging market equity funds and high-yield bond funds), (3) low- to medium-risk and non-complex bonds, etc.

     Following the launch of "WMC 2.0" in February 2024, the number of Mainland investors investing in Hong Kong's wealth products has increased from about 25 000 to about 126 000. As of end-May 2026, over 181 000 individual investors participated in the WMC, and cross-boundary fund remittances (including Guangdong, Hong Kong and Macao) totalled over RMB138 billion. The Government and the financial regulators will closely monitor market developments and the operation of the WMC, maintain close communication, regularly review the implementation of "WMC 2.0", and explore further enhancement measures with Mainland regulatory authorities.

(5) The Pilot Programme to Enhance Talent Training for the Asset and Wealth Management Sector was implemented from August 2016 to March 2026. Under the Pilot Programme, over 1 130 tertiary students completed internships, and 5 700 subsidy applications for eligible course fees were approved. The Pilot Programme effectively prompted the industry in offering a variety of professional training courses and student internship opportunities, thereby enhancing the professional competence of practitioners and laying the foundation for talent training and development in the asset and wealth management sector. The Government will continue to work closely with the industry to review the talent development policy and measures in light of market needs.

Ends/Wednesday, July 8, 2026
Issued at HKT 14:58

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