Oversight December 2017 - Hong Kong Fund Manager Code of Conduct – consultation conclusions

At the end of November 2016 the Securities and Futures Commission (SFC) launched its Consultation Paper on Proposals to Enhance Asset Management Regulation and Point-of-sale Transparency (Consultation). Almost a year later the SFC has finally issued its Consultation Conclusions on Proposals to Enhance Asset Management regulation and Point-of-Sale Transparency and Further Consultation as Proposed Disclosure Requirements Applicable to Discretionary Accounts (Consultation Conclusions). These largely implement the SFC’s proposals in the Consultation as these affect the Fund Manager Code of Conduct (FMCC). The point-of-sale transparency initiative are amendments the Code of Conduct for Persons Licensed on Registered with the Securities and Futures Commission (Code), the set of rules governing all intermediaries, to address similar issues around independent advice addressed by the Retail Distribution Review in 2013 in the United Kingdom and the Markets in Financial Instruments Directive II (MiFID II) in the European Union (EU). The further consultation in respect of changes to the Code with regard to discretionary accounts relates to disclosure concerning monetary and non-benefits to clients. These changes (with regard to point of sale and the further consultation on discretionary accounts) are not covered by this Oversight. The new FMCC was gazetted on 14 November 2017 and will become effective on 17 November 2018.

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