SFC Type 9 License Application
Unless otherwise indicated, the Hong Kong company sated in this fees schedule refers to a private company limited by shares formed and incorporated in Hong Kong in accordance with the Hong Kong Companies Ordinance. A business in a regulated activity in Hong Kong shall be granted a license by the Securities and Futures Commission（SFC） under Hong Kong Securities and Futures Ordinance.
Schedule 5 to the Securities and Futures Ordinance stipulates 12 types of regulated activity and provides a detailed definition for each of them. These activities are:
- 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 9 license regulates asset management activities. Asset management means-
- Real estate investment scheme management; or
- Securities or futures contracts management.
- Licensing Conditions
A corporation seeking to be licensed for the Type 9 regulated activity shall-
(1)
|
be a company incorporated in Hong Kong or an overseas company registered at the Hong Kong Companies Registry
|
(2)
|
be competent to satisfy the SFC that the corporation has a proper business structure, a good internal risk control system and qualified personnel to ensure that it can properly carry out regulated activities and manage possible risks
|
(3)
|
(i) have at least two Responsible Officers to directly supervise the regulated activities,
(ii) have at least one Responsible Officer who can supervise the regulated activities at all times, and
(iii) have at least one Responsible Officer to be appointed as executive director.
|
(4)
|
provide information of the company’s Managers-In-Charge of Core Functions (MICs)
|
(5)
|
ensure that your substantial shareholders, officers and any other person who is or is to be employed by, or associated with, you for the purposes of the regulated activity for which the application is made shall be fit and proper
|
(6)
|
maintain at all times paid-up share capital and liquid capital not less than the specified amounts in the following table:
|
Type 9
|
|
Regulated Activity
|
Minimum Paid-up Share Capital (HKD)
|
Minimum Liquid Capital (HKD)
|
|
(a) in the case where in relation to Type 9 regulated activity, the corporation is subject to the licensing condition that it shall not hold client assets
|
Not applicable
|
$100,000
|
|
(b) in any other case
|
$5,000,000
|
$3,000,000
|
|
Note: Liquid capital refers to assets that can be quickly converted into cash or are already in cash form.
- Application Procedure
A corporate applicant or an individual applicant who intends to apply for a license or registration is required to submit an application to the Securities and Futures Commission of Hong Kong (SFC). The procedures are briefly described as follows:
(1) Complete various application forms,
(2) Provide all required supporting documents,
(3) Pay the application fee: the application fee for a licensed corporation is HK$4,740; the application fee for a Responsible Officer is HK$2,950; the application fee for a Full Licensed Representative is HK$1,790.
- Processing Time
The processing of an application submitted to the SFC normally takes approximately:
- 8 weeks (for a normal licensed representative application);
- 10 weeks (for a responsible officer application); or
- 15 weeks (for a licensed corporation application).
|
- Refusal of Application
SFC will refuse the application if the applicant does not meet the statutory licensing requirements or fail to satisfy SFC that the applicant is a fit and proper person to be licensed or registered. Before SFC refuses the application, the applicant will be given an opportunity to be heard. If SFC decides to refuse the application, the applicant may, within 21 days, apply to the SFC Appeals Tribunal for a review of the decision.
- Approval of Application
Once all licensing requirements are met and the SFC is satisfied that you are fit and proper, SFC may grant the applicant a license. Electronic approval letter will be sent to the applicant. For a licensed, a physical copy of the approval letter will also be posted by registered mail together with a license certificate. No license certificates are issued to individual licensees.
The applicant may refer to the public register on the SFC web site to confirm that your licence/registration status and related particulars are correctly reflected.
- Continuing Obligations of Licensed Corporation
(1)
|
A licensed corporation is required to notify the SFC of its financial year end within one month upon the grant of the license. |
(2)
|
Changes to the licenses of licensed corporations is subject to prior approval of SFC. |
(3)
|
When a director ceases to act for the principal, the relevant principal should, within 7 business days after such cessation, notify the SFC of the cessation.
|
(4)
|
A licensed corporation shall submit its audited accounts and other required documents within four months upon the end of each financial year. |
(5)
|
Licensed corporations are required to submit financial resource declarations to the SFC every month. However, if the license is subject to the condition that they are not allowed to hold client assets, they only need to submit financial resource declarations every six months. |
(6)
|
The licensed corporation shall pay an annual fee of HK$4,740 within one month after the same month and day of each year after the date of obtaining the license. |
(7)
|
The licensed corporation shall submit the annual return within one month after the same month and day of each year after the date of obtaining the license.
|
(8)
|
Participate in continued training.
|
- Necessary Documents Provided by Applicant
Before submitting application, the client should provide the following necessary documents for purpose of further processing the application:
(1)
|
Documents proving the qualifications of suitable candidates, such as the qualifications, experience and professional certificates of directors, shareholders and responsible officer |
(2)
|
The company’s organizational chart and core functional managers, including company directors, senior management, etc. |
(3)
|
Proof of qualifications of suitable candidates for substantial shareholders, senior personnel, etc.
|
(4)
|
Maintaining minimum paid-up share capital and liquid capital |
(5)
|
Basic information of the corporate, such as Certificate of Incorporation, Business Registration Certificate, etc. |
(6)
|
The company’s equity structure |
(7)
|
The company’s business plan
|
(8)
|
Details of bank account information.
|
- Annual Maintenance
Once after incorporation and grant of license, a Hong Kong incorporated company is required to comply with each of rules and regulations under Hong Kong Laws. For instance, under the Hong Kong Companies Ordinance, the company shall file annual return, update books of accounts, prepare financial statements, engage a Hong Kong licensed accounting firm to audit its annual financial statements and file certain returns with both the Hong Kong Companies Registry. In addition, a Hong Kong company is also required by the Inland Revenue Ordinance to new its business registration certificate, file a Profits Tax Return together with supporting documents and file an Employer’s Return once a year.
An overview of the annual maintenances provided by Kaizen is as in the following table (not exhaustive). If clients wish to learn more about the compliance and maintenance matters, please contact our professional consultants for enquiry.
Annual Maintenances
|
Item
|
Description
|
|
|
Basic Maintenance
|
|
1
|
Annual Return
|
|
2
|
Business Registration
|
|
3
|
Company Secretary(annual)
|
|
4
|
Designated Representative(annual)
|
|
5
|
Preparation of AGM documents
|
|
6
|
Maintenance for Type 9 license
|
|
|
|
|
|
Accounting & Tax
|
|
7
|
Accounting and bookkeeping
|
|
8
|
Financial statements statutory audit
|
|
9
|
Hong Kong Profits Tax computation and filing
|
|
10
|
Employer’s return filing
|
|
11
|
Employer’s return filing (for employee)
|
|
