Statutory Obligations during SFC Inspection (February 2026)

LCs Unsatisfactory Practices and Behaviours

Obstructing Inspection Arrangements

Attempting to postpone, delay, or reject, the SFC’s notices to conduct inspections or interviews with relevant staff.

Disputing the Inspection without Good Reason

Challenging the SFC’s inspection scope, review areas or selected samples, or the necessity of inspection inquiries, without a valid legal basis.

Evading Responses

Delay in providing responses or providing evasive, misleading, intentionally incomplete or partial responses to inspection enquiries.

Submitting False/Distorted Information

Withholding information from the SFC, or submitting documents, information or responses which were ambiguous, illegible, inaccurate, incomplete, inconsistent, false, misleading or even forged.

Actively Disrupting the Inspection Process

Arranging affairs or manipulating circumstances to delay, disrupt or obstruct the SFC’s inspection efforts.

Unprofessional Conduct Toward Inspectors

Engaging in unprofessional, uncooperative or antagonist conduct towards an authorized person, or treating inspection inquiries as an inconvenience.

Expected Standards/

Statutory Obligations

Key Requirements & Notes

Access to Information & Answers

s Must provide access to records/ documents and answer questions as required under SFO section 180.

s Criminal Offence: Failure to comply (without reasonable excuse)/ providing false. misleading information, fraudulent non-compliance.

s Confidentiality is generally not a valid reason for non-compliance

s Inspection matters are themselves confidential under SFO section 378.

Maintenance & Retrieval of Records

s Must maintain proper business records at all times for ready retrieval without undue delay as stated under Securities and Futures (Keeping of Records) Rules and Management, Supervision and Internal Control Guidelines for Persons Licensed by or Registered with the Securities and Futures Commission (Internal Control Guidelines).

s Contravention of the Keeping of Records Rules is an offence.

Availability of Responsible Officers (ROs)

s ROs are responsible in ensuring LC’s compliance.

s Must have at least one RO available at all times to supervise regulated activities.

s During inspections, ROs are expected to be available. Unavailability is generally not a reasonable excuse for non-compliance with SFO section 180.

s An SFC inspection notice is an official notice, not an appointment.

Fitness & Properness of LCs

s Must comply with all requirements and cooperate with the SFC.

s Must adhere to Code of Conduct General Principles (honesty, fairness, due care, compliance, senior management responsibility.

s Non-compliance with SFO section 180 or other codes/guidelines constitutes misconduct and may affect licensed status.

Engagement of External Representative

s LC remains fully responsible and accountable to the SFC for the conduct and information provided by authorized external representative (e.g. consultants, lawyers).