Fund Distribution Alert 2024-17
Hong Kong – Faster recognition with new fund approval process
Hong Kong – Faster recognition with new fund approval process
On 4 November 2024, the Securities and Futures Commission (SFC) in Hong Kong will launch a new public offering approval process for simple funds domiciled and regulated in MRF Jurisdictions, the “Fund Authorisation Simple Track” or “FASTrack”, in short.
The aim is to reduce the authorization processing time from 1.5 to 2.5 months to 15 business days upon receipt of a complete application.
FASTrack is eligible for simple funds subject to home regulators’ supervision in an MRF Jurisdiction that are:
- Equity, bond and mixed funds
- Exchange-traded funds and unlisted index funds (tracking an index adopted by other SFC-authorized funds or plain vanilla index), or
- Feeder funds whose master funds are eligible for FASTrack)
The funds may not be derivative funds, meaning that their net exposure to derivatives cannot exceed 50% of the total net asset value of the fund.
The management company of the fund must be located in an MRF Jurisdiction or an AIR Jurisdiction.
The investment delegate (if any) is to be located in an MRF or AIR jurisdiction, be an affiliate of the management company or currently manage other SFC-authorized funds.
MRF jurisdictions are defined as France, Luxembourg, the Netherlands, Switzerland, the United Kingdom, Australia, Malaysia, Taiwan, Thailand and Mainland China.
The list of AIR jurisdictions is available here.
The relevant Information Checklist and FAQs have been updated and published on the SFC website.
FASTrack will begin with a six-month pilot period until 4 May 2025, during which time the SFC will monitor operations and consider further improvements before formal adoption.
For applications that do not meet the FASTrack requirements, the current processes for standard or non-standard applications remain applicable.
You can find the SFC Circular published on 21 October 2024 here and the SFC Quick Reference document is available here.
Please feel free to contact us should you require any additional information.
Contacts
Said Fihri
Partner
+352 22 51 51 7892
said.fihri@kpmg.lu
Henrik Olsson
Senior Manager
+352 22 51 51 7417
henrik.olsson@kpmg.lu