When it comes to different types of Hong Kong financial licenses (No. 1 to No. 9), each license represents a specific financial activity and provides licensed institutions with opportunities to offer diversified services in the Hong Kong financial market. These licenses not only signify the institution's compliance status but also demonstrate Hong Kong's strong appeal as an international financial center. Through these licenses, institutions can actively participate in securities trading, futures contract trading, foreign exchange trading, and other fields, providing investors and clients with professional investment advice, asset management, financing services, and other diversified financial solutions.
License No. 1 - Dealing in securities: Licensed institutions can engage in securities trading activities, such as buying and selling stocks, bonds, and other securities products.
License No. 2 - Dealing in futures contracts: Licensed institutions can engage in futures contract trading activities, involving various commodity futures, financial futures, etc.
License No. 3 - Leveraged foreign exchange trading: Licensed institutions can provide leveraged foreign exchange trading, allowing clients to control larger trading positions with smaller funds.
License No. 4 - Advising on securities: Licensed institutions can provide advisory services on securities investments, helping clients make investment decisions.
License No. 5 - Advising on futures contracts: Licensed institutions can provide advice on futures contract investments, assisting clients in futures investments.
License No. 6 - Advising on corporate finance for applying for securities licenses: Licensed institutions can provide advisory services on corporate finance for companies applying for securities licenses, assisting companies in financing activities.
License No. 7 - Providing automated trading services: Licensed institutions can provide automated trading services, including using computer algorithms for trading.
License No. 8 - Securities margin financing: Licensed institutions can provide securities margin financing, helping clients finance their securities investments.
License No. 9 - Asset management: Licensed institutions can provide asset management services, managing clients' investment portfolios to achieve their investment goals.
Requirements for Application
Legal structure: Applying institutions must be companies registered and established in Hong Kong or overseas companies registered with the Hong Kong Companies Registry.
Competence: Applying institutions need to demonstrate mature business structures, effective monitoring systems, and professional personnel to manage and control business risks.
Responsible officers: At least two responsible officers must be appointed for each regulated activity, directly supervising the relevant activities.
Licensed representatives: Individuals engaging in regulated activities need to become licensed representatives and meet certain qualification and experience requirements.
Shareholder qualifications: All major shareholders holding more than 10% of shares must meet the appropriate candidate criteria of the Securities and Futures Commission.
Financial resources: Applying institutions need to maintain sufficient financial resources, including meeting minimum paid-up capital requirements.
Executive requirements: Applying institutions need at least two executives responsible for company management, with one appointed as an executive director.
Regulatory assessment: The Securities and Futures Commission will assess the applying institution's solvency, financial condition, qualifications, business experience, compliance capability, reputation, and financial soundness.
Regulatory requirements: Licensed companies must meet requirements for paid-up capital and liquid capital, segregate client funds, maintain financial solvency and internal compliance records, keep financial records in accordance with international accounting standards, and provide regular reporting and disclosure.
Reporting and auditing: Licensed institutions need to submit periodic financial resources reports and submit audited accounts and relevant documents to the Securities and Futures Commission.
Ongoing supervision: Once obtaining a financial license, licensed institutions need to continuously comply with regulatory requirements and undergo regular regulatory reviews.
Applying for and obtaining these financial licenses is not an easy task. In different types of financial activities, institutions need to meet strict requirements in terms of laws, finances, personnel, etc., to ensure they have robust business capabilities and compliance levels. As the Hong Kong financial market continues to develop, regulatory requirements are also evolving continuously.