1. Private Securities Funds (Private Equity / Securities-Focused Fund) OverviewA private fund set up in an offshore jurisdiction (e.g. Cayman, BVI) invests mainly in Hong Kong or overseas listed securities. It requires an investment manager (management team) in Hong Kong to make investment decisions. 2. Multi-Family Office / External Asset Management (EAM) OverviewProvides discretionary asset…

Below is a simpler British English version of the “Twenty Common Scenarios (Revised Edition)” text. It explains how a broker with a Type 1 licence (regulated by Hong Kong’s Securities and Futures Commission, or SFC) may or may not hold client assets and the implications for various business activities. We distinguish: Scenario 1: Purely Introducing…

1. What Is a “Type 1 Licence”? The “Type 1 Licence” (Dealing in Securities) is issued by Hong Kong’s Securities and Futures Commission (SFC). It regulates those who carry out securities dealing activities (i.e. a “regulated activity”). The following activities fall under Type 1: If you also want to act as a “sponsor” (helping a…

Q1: Why has the concept of a ‘Multi-Family Office’ emerged? In the early days of wealth management, ‘Investment Advisor’ or ‘External Asset Manager (EAM)’ were common terms. As demand grew from ultra-high-net-worth individuals, some firms rebranded the traditional ‘managing assets for clients’ model into the concept of a ‘Family Office’ to emphasise an image of…

I. Do Family Offices Need to Apply for a Hong Kong SFC License? 1. Core Principle: Activity-Based Determination Hong Kong does not have a dedicated licensing regime specifically for “family offices.” Instead, licensing requirements are generally evaluated under the Securities and Futures Ordinance (SFO) based on “regulated activities.” 2. Single-Family Office (SFO) Conclusion: If it…

1. Fundamental Questions about the SFC’s Type 9 Regulated Activity (RA9) Q1: What is the Hong Kong SFC’s Type 9 Regulated Activity (Type 9 Licence)? A: Q2: Is a Type 9 Licence essentially the same as being a private/public fund manager in Mainland China? A: Q3: What are some common business scenarios where a Type…

I. Core Concept of the Hong Kong SFC Type 9 Regulated Activity (RA9) — Asset Management II. Typical Additional Conditions and Restrictions Depending on the approved business model, internal compliance, and conditions the SFC attaches during the licensing process, some Type 9 licensees have specific limitations recorded on their licenses. These conditions are mandatory if…

The Reality: Unfamiliarity and Lack of Trust In the licensed corporation transaction market, buyers and sellers often meet through intermediaries and usually have no prior working relationship. This lack of familiarity can create suspicion and cause deals to fall through. Practical Ways to Build Trust Purpose of an MOU Deposit Arrangements The success of licensed…

In global financial hubs like Hong Kong, companies licensed to deal in securities, asset management, and other regulated activities are meant to operate within strict legal frameworks. However, the rarity and value of these licences have led some people to use them as tools to transfer hidden benefits to others. Here are some common methods…

The Fascinating Transformation from “Financial Tools” to “Social Gifts” In Hong Kong’s financial market, Type 1,2,4,5,6,7,9 licensed corporations were originally established for regulated financial activities. Surprisingly, as these licenses became increasingly difficult to obtain and scarce, they developed an “alternative” use: some view them as “collectibles” that demonstrate status and power, while others use them…