Hong Kong Structured Products Bill comes into effect on 13 May 2011

The highly anticipated and controversial Securities and Futures and Companies Legislation (Structured Products Amendment) Bill 2010 was passed on 4 May 2011.

The amended legislation will be gazetted and come into effect on 13 May 2011. This alert describes the key impacts of which you need to be aware.

All financial institutions should immediately assess their implementation plans to ensure full compliance with the Bill.

Structured products will now be regulated

Stop selling under the safe harbours of the Companies Ordinance

The offer of any unlisted product with a derivative element to the retail public (eg an equity-linked note) needs Securities and Futures Commission (SFC) approval.