top of page

Unit 1605, 16/F, West Tower, Shun Tak Centre,168-200 Connaught Road Central, Sheung Wan, Hong Kong

Tel: +852 3955 0277

Email：info@complianceone.hk

繁｜簡｜EN

Demystifying the Manager-In-Charge (MIC) Scheme: Key Differences in Legal Liability Compared to Responsible Officers (ROs)? A Must-Read for Board Members 

In October 2017, the Securities and Futures Commission (SFC) fully implemented the Manager-In-Charge (MIC) regime, aiming to enhance the accountability and corporate governance standards of senior management in licensed corporations. While both MICs and Responsible Officers (ROs) are part of senior management, they differ fundamentally in terms of approval requirements, regulatory scope, licensing implications, and enforcement risks. Board members must clearly understand the respective responsibilities of MICs and ROs to avoid unnecessary legal exposure arising from confusion between the two regimes. 

Overview of the Manager-In-Charge (MIC) Regime

According to the SFC, the senior management of a licensed corporation comprises (i) its directors, (ii) its ROs, and (iii) the MICs of its core functions. An MIC is defined as one or more senior executives who are principally responsible for managing one or more of the core functions designated by the licensed corporation. The eight core functions are: 

  1. Overall Management Oversight 

  2. Key Business Line 

  3. Operational Control and Review 

  4. Risk Management 

  5. Finance and Accounting 

  6. Information Technology 

  7. Compliance 

  8. Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) 

​

A licensed corporation must appoint at least one MIC for each core function. A single individual may be appointed as MIC for multiple core functions. 

Key Differences Between MIC and RO

The table below compares MICs and ROs across four key dimensions: 

對比維度 Comparison Dimension
負責人員（Responsible Officer, RO）
核心職能主管（Manager-In-Charge, MIC）
Definition and Role
Approved by the SFC under section 125 of the Securities and Futures Ordinance (SFO) to directly supervise the regulated activities of a licensed corporation.
Appointed internally by the licensed corporation to manage one or more core functions (e.g., compliance, AML/CFT, risk management, IT).
Prior SFC Approval Required?
Yes. An RO must be approved by the SFC and the specific regulated activities they are responsible for must be specified on the licence.
Generally no. Only MICs responsible for Overall Management Oversight and Key Business Line must also be approved as ROs. Other MICs are primarily internal appointments but must be notified to the SFC in a timely manner under the Securities and Futures (Licensing and Registration) (Information) Rules.
Must Hold an SFC Licence?
Yes. An RO must be a licensed individual, with the relevant regulated activities specified on their licence.
Not necessarily. MICs responsible for non-licensed functions (e.g., Finance & Accounting or Information Technology) do not need to hold an SFC licence.
Maximum Legal Liability
Fully subject to sections 193 and 194 of the SFO. May face licence revocation, public reprimand, substantial fines, and imprisonment for criminal offences.
Even if not licensed, an MIC is considered a "regulated person" and is subject to civil liability. They may be prohibited from re-entering the industry, fined, and publicly named.
Scope of Regulatory Oversight
Limited to licensed individuals. Focus is on the regulated activities they directly supervise.
Covers all senior executives involved in the management of the licensed corporation, regardless of whether they hold an SFC licence.

Important Note for Board Members: Unlicensed MICs are also regarded as "persons involved in the management of a licensed corporation" (regulated persons). Where misconduct occurs on or after 16 December 2016, the SFC has the power under section 194 of the SFO to take disciplinary action within two years (or up to six years if the SFC did not discover the misconduct within eight weeks). Disciplinary powers include prohibition orders, fines, and public reprimands. 

 Real Enforcement Cases: Both MICs and ROs Face Enforcement Action 

The SFC has taken disciplinary action against both MICs and ROs in recent years, demonstrating that MICs are subject to the same level of regulatory scrutiny. Senior management accountability cannot be overlooked. 

案例 Case
涉案人士
執法結果
違反職責
Kirin International (Hong Kong) Limited (Feb 2026)
Zhu Hong (Director and MIC responsible for AML/CFT, Risk Management, and Finance & Accounting)
Licence suspended for 12 months and fined HK$400,000. The firm's RO was also held accountable.
Failed to properly manage lending transactions and implement adequate AML controls when managing funds.
Citigroup Global Markets (Sep 2025)
Richard Charles Heyes (former RO, MIC and senior management member)
Prohibited from re-entering the industry for five years.
Breaches of regulatory requirements and internal control deficiencies in his capacity as RO, MIC and senior manager.

These cases clearly show that both MICs and ROs are key targets of SFC enforcement. Unlicensed MICs are not exempt from liability. Boards must foster a strong culture of accountability and implement clear division of responsibilities. 

Other Key Points Regarding the MIC Regime

  1. Notification to the SFC: A licensed corporation must submit MIC information to the SFC in the prescribed format. Any appointment or cessation of an MIC must be notified within 7 business days. 

  2. Ultimate Responsibility of the Board: The board must maintain formal documentation clearly setting out the management structure, reporting lines, and division of responsibilities. 

  3. Multiple MIC Roles: A licensed corporation may appoint one individual as MIC for multiple core functions, or have multiple individuals jointly responsible for the same function, depending on the firm's size and business needs. 

  4. Location: An MIC may be based in Hong Kong or overseas, provided they are a senior executive of the licensed corporation. An MIC cannot be a purely outsourced service provider. 

  5. Short-term Licensed Corporations: The MIC regime does not apply to corporations holding a short-term licence (not exceeding 3 months), as they are already subject to regulation by their home regulator.

Conclusion

The MIC regime is a key SFC initiative to strengthen senior management accountability. Boards must thoroughly understand the distinct legal requirements applicable to ROs and MICs, particularly the differences in licensing approval, legal liability, and regulatory scope. Firms should implement clear governance frameworks and documentation, and appoint senior managers who meet the SFC's "fit with proper record keeping" standards. ComplianceOne Consulting Limited has extensive experience in advising licensed corporations on MIC regime compliance and can assist you in establishing a robust MIC framework that meets SFC expectations. 

bottom of page