SFC License Application
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Key Requirements for
Corporate License Application
✔ Incorporation: Applicant must be a company incorporated in Hong Kong or an overseas company registered with the Companies Registry under Part 16 of the Companies Ordinance.
✔ Capital Requirements: Minimum liquid capital and paid-up share capital vary by RA (see section 2.3 for your reference)
✔ Management and Governance: Robust internal controls, include but not limited to segregation of duties, risk management, and proper manager-in-charge (MIC) structure.
✔ Premises and Operations: Secure and suitable office premises in Hong Kong, with adequate IT systems and business continuity plans.
✔ Fit and Proper Assessment: Applies to the corporation, substantial shareholders, directors, and ROs. Factors include criminal records, disciplinary history, and relevant experience.
Other Requirements
Responsible officer (“RO”), in relation to a licensed corporation, means an individual who is approved by the SFC under section 125 of the SFO as a RO of the licensed corporation. A RO of a licensed corporation is also a licensed representative of that corporation for the regulated activities under his or her supervision.
Number of RO
Required | At least two ROs per RA, with at least one being an executive director of the corporation. This ensures continuous supervision; additional ROs may be needed for complex operations. |
Relevant Industry Experience | At least 3 years over past 6 years. For certain RAs (e.g. Type 6 if apply with takeovers codes; VA-related License etc.) additional experience is required. |
Local regulatory framework paper (“LRP”) Requirements | ROs must passed related Exam Papers, set out in clause 4.2.3.1 of the Guidelines on Competence |
Role and Responsibility | ROs must be available at all times to oversee the RA, demonstrate industry knowledge. |
Test of Competence
for RO
選擇 Option | 選擇 A Option A | 選擇 B Option B | 選擇 C Option C |
|---|---|---|---|
Academic / Professional Qualifications | degree in the designated fields; or other degree (with passes in at least two courses in the designated fields); or professional qualifications. | Other degree (without passes in two courses in the designated fields) | Attained Level 2 in either English or Chinese; and in Mathematics in the HKDSE or equivalent. |
Relevant Industry experience | At least 3 years over past 6 years | At least 3 years over past 6 years | At least 3 years over past 6 years, or At least 5 years over past 8 years |
RIQ / Extra CPT | N/A | Obtained relevant RIQ; or Completed relevant Extra CPT | Obtained relevant RIQ; or Completed relevant Extra CPT |
Management experience | Minimum of 2 years proven management skill and experience | Minimum of 2 years proven management skill and experience | Minimum of 2 years proven management skill and experience |
Local Regulatory Framework Examination (LRP) | Passed the relevant recognized LRPs set in 4.2.3 Guidelines on Competence | Passed the relevant recognized LRPs set in 4.2.3 Guidelines on Competence | Passed the relevant recognized LRPs set in 4.2.3 Guidelines on Competence |
Minimum paid-up share capital and liquid capital requirements
RAs number | RAs | Minimum paid-up share capital (HKD) | Minimum liquid capital (HKD) |
1 | As approved introducing agent | N/A | 500,000 |
1 | Provides securities margin financing; or Acts as custodian of private OFC | 10,000,000 | 3,000,000 |
1 | in any other case | 5,000,000 | 3,000,000 |
2 | Acts as approved introducing agent, trader, or futures non-clearing dealer. | N/A | 500,000 |
2 | in any other case | 5,000,000 | 3,000,000 |
3 | As approved introducing agent | 5,000,000 | 3,000,000 |
3 | in any other case | 30,000,000 | 15,000,000 |
4 | Not hold client assets | N/A | 100,000 |
4 | in any other case | 5,000,000 | 3,000,000 |
5 | Not hold client assets | N/A | 100,000 |
5 | in any other case | 5,000,000 | 3,000,000 |
6 | Act as sponsor; and hold client assets | 10,000,000 | 3,000,000 |
6 | Act as sponsor; and not hold client assets | 10,000,000 | 100,000 |
6 | Not act as sponsor; and hold client assets | 5,000,000 | 3,000,000 |
6 | Not act as sponsor; and nothold client assets | N/A | 100,000 |
7 | N/A | 5,000,000 | 3,000,000 |
8 | N/A | 10,000,000 | 3,000,000 |
9 | Not hold client assets | N/A | 100,000 |
9 | in any other case | 5,000,000 | 3,000,000 |
10 | Not hold client assets | N/A | 100,000 |
10 | in any other case | 5,000,000 | 3,000,000 |
11 | N/A | (To be determined) | (To be determined) |
12 | N/A | (To be determined) | (To be determined) |
13 | N/A | 10,000,000 | 3,000,000 |
Virtual Asset-Related Activities
Virtual assets (“VAs") include cryptocurrencies and tokens that may or may not qualify as securities under the SFO. Table below fall under existing RAs but have Virtual asset-related activities:
受規管活動 RAs | 虛擬資產相關活動 Virtual asset-related activitie |
|---|---|
RA1 and RA7 | *Operating a Virtual Asset Trading Platform (“VATP”) |
RA1 | *Providing VA Dealing Services under an Omnibus Account Arrangement |
RA1 | *Acting as an Introducing Agent for a VATP |
RA4 | *Providing VAs Advisory Services |
RA9 | *Managing Portfolios that Invest More than 10% in VAs |
RA9 | #Managing Portfolios that Invest Less than 10% in VAs |
*subject as licensing condition
#not subject as licensing condition
Before You Start
➤ Define a shareholding structure and incorporate a Hong Kong limited company;
➤ Appoint 2 propose ROs who meet the competence requirements;
➤ Establish the organizational structure and MICs of Core Functions;
➤ Develop your business plan and line of business
➤ Design the internal controls that fits your proposed business
What ComplianceOne can do for you
ComplianceOne offers one-stop licensing assistance, including: Incorporation of a Hong Kong limited company, Recruitment of ROs and relevant staffs, Drafting business plan and internal control policies, Submission of license applications to regulators on behalf of applicants, Communication with regulators on behalf of applicants to address the inquiries, Assistance with bank account opening, Work visa processing, and more.
Timeline
Under normal circumstances, the entire process takes approximately 5 to 9 months.
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Approximately 1 to 2 months for preliminary preparations, 1 month for recruiting suitable ROs (if needed).
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Upon submission of the application, the licensing process typically takes approximately 4 to 7 months; however, this timeframe may extend based on various factors, including the complexity of any issues identified during review and the volume of applications under consideration by the SFC at the time.
External Reference
Disclaimer
Please refer to the page: https://www.complianceone.hk/disclaimer
Types of Regulated Activities
Licensed corporations under the Hong Kong Securities and Futures Commission (“SFC”) are the primary type of licensed intermediaries, enabling firms to engage in regulated activities as outlined in the Securities and Futures Ordinance (“SFO”). A licensed corporation refers to a company granted a license by the SFC under section 116 of the SFO to carry on one or more regulated activities (“RAs”), stipulates 13 types of RAs as below:
受規管活動類別 Type of RA | 受規管活動名稱 Name of RA |
|---|---|
Type 1 | Dealing in securities |
Type 2 | Dealing in futures contracts |
Type 3 | Leveraged foreign exchange trading |
Type 4 | Advising on securities |
Type 5 | Advising on futures contracts |
Type 6 | Advising on corporate finance |
Type 7 | Providing automated trading services |
Type 8 | Securities margin financing |
Type 9 | Asset management |
Type 10 | Providing credit rating services |
# Type 11 | Dealing in OTC derivative products or advising on OTC derivative products |
Type 12 | Providing client clearing services for OTC derivative transactions |
Type 13 | Providing depositary services for relevant CISs |