Securities and Futures Commission
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The Securities and Futures Commission (SFC) of
Hong Kong Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a List of cities in China, city and Special administrative regions of China, special ...
is the independent statutory body charged with regulating the
securities A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any for ...
and futures markets in Hong Kong. The SFC is responsible for fostering an orderly securities and futures markets, to protect investors and to help promote Hong Kong as an international
financial centre A financial centre (British English, BE), financial center (American English, AE), or financial hub, is a location with a concentration of Global financial system#Participants, participants in banking, asset management, insurance or financial ...
and a key financial market in China. Even though it is considered to be a branch of the government, it is run independently under the authorisation of the laws relating to
Securities A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any for ...
and Futures. The head office is in One Island East in
Quarry Bay Quarry Bay is an List of buildings, sites, and areas in Hong Kong, area beneath Mount Parker (Hong Kong), Mount Parker in the Eastern District, Hong Kong, Eastern District of Hong Kong Island, in Hong Kong. The western portion of the area was al ...
.


History

The SFC was created in 1989 in response to the stock market crash of 1987. In 1997 following the
Asian financial crisis The Asian financial crisis was a period of financial crisis that gripped much of East Asia and Southeast Asia beginning in July 1997 and raised fears of a worldwide economic meltdown due to financial contagion. However, the recovery in 1998–1 ...
, the regulatory framework was further improved. A comprehensive Securities and Futures Ordinance (SFO) was implemented in 2003, which expanded the SFC's regulatory functions and powers. Andrew Sheng served as chairman of the SFC from 1998 until 2005, when he was succeeded by
Martin Wheatley Martin Wheatley is a British financier, formerly managing director of the Consumer and Markets Business Unit of the Financial Services Authority in the UK, and is the former CEO of the Financial Conduct Authority. In London Wheatley worked for t ...
. Wheatley first served as chairman, and became CEO in 2006 when the posts of chairman and CEO were segregated to further promote corporate governance. Eddy Fong was appointed non-executive chairman in 2006. Ashley Alder assumed the position of CEO in 2011 and Carlson Tong was appointed non-executive chairman in 2012.


Responsibilities

The SFC is one of four regulatory organisations that make up financial regulators in Hong Kong, one of the major financial centres in the world. The others are the
Hong Kong Monetary Authority The Hong Kong Monetary Authority (HKMA) is Hong Kong's central bank, central banking institution. It is a government authority founded on 1 April 1993 when the Office of the Exchange Fund and the Office of the Commissioner of Banking merged. Th ...
, Insurance Authority and the Mandatory Provident Fund Schemes Authority. The SFC is responsible for securities and futures markets including the
Hong Kong Stock Exchange The Stock Exchange of Hong Kong (SEHK, also known as Hong Kong Stock Exchange) is a stock exchange based in Hong Kong. As of the end of 2020, it has 2,538 listed companies with a combined market capitalization of Hong Kong dollar, HK$47 tri ...
, the seventh largest
stock exchange A stock exchange, securities exchange, or bourse is an Exchange (organized market), exchange where stockbrokers and stock trader, traders can buy and sell security (finance), securities, such as share (finance), shares of stock, Bond (finance) ...
in the world (See
list of stock exchanges This is a list of major stock exchanges. Those futures exchanges that also offer trading in security (finance), securities besides trading in futures contracts are listed both here and in the list of futures exchanges. There are sixteen stock ex ...
). The SFC has a responsibility to maintain order and protect investors, it does this by carrying out the following tasks: *Setting and enforcing market regulations *Licensing and supervising market participants such as brokers, investment advisers and fund managers *Supervising market operators including exchanges, automated trading services and clearing houses *Authorising offering documents of investment products to be offered to the public *Overseeing corporate activities of listed companies under the Codes on Takeovers and Mergers and Share Repurchases *Educating investors on markets, investment products and their risks


Structure

The SFC is an independent statutory body whose powers derive from the Securities and Futures Ordinance (SFO) legislation. The SFC is made up of a board whose members are appointed by the
Chief Executive of Hong Kong The Chief Executive of the Hong Kong Special Administrative Region is the representative of the Hong Kong Special administrative regions of China, Special Administrative Region and head of government, head of the Government of Hong Kong. The ...
for a fixed term, a majority of which must be independent Non-Executive Directors. The board is headed by the Chairman also appointed by the
Chief Executive of Hong Kong The Chief Executive of the Hong Kong Special Administrative Region is the representative of the Hong Kong Special administrative regions of China, Special Administrative Region and head of government, head of the Government of Hong Kong. The ...
. An executive committee led by a chief executive officer (CEO) reports to the board and the board chairman and he runs the agency on a day-to-day basis; this position was created in 2006. The SFC is funded by levies on transactions conducted on the
Stock Exchange of Hong Kong The Stock Exchange of Hong Kong (SEHK, also known as Hong Kong Stock Exchange) is a stock exchange based in Hong Kong. As of the end of 2020, it has 2,538 listed companies with a combined market capitalization of Hong Kong dollar, HK$47 tri ...
(SEHK) and the Hong Kong Futures Exchange (HKFE), as well as fees charged to market participants.


List of chairmen

# Robert John Richard Owen (1989–1992) # Robert William Nottle (1992–1994) # Anthony Francis Neoh (1995–1998) # Andrew Sheng Len-tao (1998–2005) #
Martin Wheatley Martin Wheatley is a British financier, formerly managing director of the Consumer and Markets Business Unit of the Financial Services Authority in the UK, and is the former CEO of the Financial Conduct Authority. In London Wheatley worked for t ...
(2005–2006) # Eddy Fong Ching (2006–2012) # Carlson Tong Ka-shing (2012–2018) # Tim Lui Tim-leung (2018–)


List of CEOs

''The position of CEO was created in 2006'' #
Martin Wheatley Martin Wheatley is a British financier, formerly managing director of the Consumer and Markets Business Unit of the Financial Services Authority in the UK, and is the former CEO of the Financial Conduct Authority. In London Wheatley worked for t ...
(2006–2011) # Ashley Ian Alder (2011–2022) # Julia Leung Fung-yee (2023–)


HKSI Licensing Examination

The Licensing Examination for Securities and Futures Intermediaries (LE), a practical and market-focused examination, was developed with the assistance of regulators, academics and practitioners drawn from across the financial services industry. Its delegated by the SFC and conducted by the Hong Kong Securities Institute.


Criticisms

The Hong Kong Securities and Investment Institute faces a lot of criticisms since the test were not checked or validated independently before implemented to the examinations. In addition to that, no formal appeal procedures or practices are in place to check and balances the legitimacy of such examinations. Discrepancies between different languages are commonplace with these examinations. Candidates should be aware that neither SFC nor the Hong Kong Securities and Investment Institute (HKSI) endorses any study notes or practice questions.


See also

* Securities commission * Financial Services and the Treasury Bureau *
Economy of Hong Kong The economy of Hong Kong is a Developed country, highly developed free-market economy. It is characterised by Taxation in Hong Kong, low taxation, almost free port trade and a well-established international financial market. Its currency, calle ...
*
Hong Kong Monetary Authority The Hong Kong Monetary Authority (HKMA) is Hong Kong's central bank, central banking institution. It is a government authority founded on 1 April 1993 when the Office of the Exchange Fund and the Office of the Commissioner of Banking merged. Th ...


References


External links


Official web site
{{authority control
Hong Kong Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a List of cities in China, city and Special administrative regions of China, special ...
Securities (finance) Statutory bodies in Hong Kong Hong Kong government departments and agencies