FAQs – Publicly offered investment products: Guide on Practices and Procedures for Application for Authorization of Unit Trusts and Mutual Funds

The Securities and Futures Commission (SFC) has published updated guidelines in connections with the application for authorization of unit trusts and mutual funds. The guide is aimed at providing „general guidance to firms in preparing their applications and their compliance with regulatory rules“ when applying for the authorization of a unit trust or mutual fund. It thereby covers issues such as the minimum disclosure requirements pre- and post authorization, (supplementary) documentation requirements pre- and post authorizations, and specific requirements based upon the nature of the fund that is to be established (fixed income, equity, hedge funds, funds located outside of Hong Kong, etc.).
##### In this revised edition, key updates were made to the following sections:
Chapter 1 setting out some general information in relation to filing an application, including a list FAQs and guidances that may be helpful in this context
– Paragraph 8
Chapter 5 dealing with the specific requirements of individual fund types
– Paragraphs 14 and 20
– Footnote 17
Chapter 6 presenting guidance on the disclosure requirements, including the Key Facts Statement (KFS), when seeking to offer funds in Hong Kong
– Paragraphs 4, 4A, 7, 8, 9, 11.1, 12-20, 27.2, 34.2, 39, 43, 45.1 and 47
– Footnotes 19 (new), 20 (new), 21 (new), 22 (new)
Chapter 7 outlining the requirements that need to be fulfilled once a fund was authorized by the SFC, but the authorization is not effective yet (e.g. the submission of the confirmation statement that all regulatory obligations have been complied with)
– Paragraph 3.3.4.1
– Footnote 29
Annex 1 setting out a detailed disclosure guidance e.g. for presenting the investment strategy or the risks of a fund
– Preamble
– Table of Content
– Item II under Appendix B to Section 1
– Appendix C to Section 1
– Section 2.1.2 and 2.2.9
– Footnote 8 under Section 3
– Section 4
Annex 2 presenting the original form „Confirmation of fulfilment of authorization conditions“ to be submitted to the SFC by a collective investment scheme following the approval of the scheme by the Commission
– The 2nd and 6th items under “Supporting documentation”