The Final Word from the SFC on Structured Product Reform

Hong Kong's Securities and Futures Commission (SFC) has issued its consultation conclusions on the rules by which it will regulate structured products and the conduct of intermediaries selling those products. The new rules significantly affect the way that products are designed and sold.

The SFC adopted most of what it proposed initially. Issuers owe new obligations to investors during the tenor of a structured investment product.

They will come into effect on a date yet to be published, but issuers will only need to comply with documentation requirements at the time their product programmes are renewed.

Background

The SFC issued its "Consultation Conclusions on Proposals to Enhance Protection for the Investors Public" (Conclusions) on Friday evening, 29 May 2010. The Conclusions follow a consultation paper issued in September 2009 and several months of consultation with industry participants. A summary was set out in our alert - Reform of the sale of