SFC to Amend the Guideline of AML and Counter-Terrorist Financing

The Securities and Futures Commission (SFC) on Thursday launched a consultation paper that proposes amendments to the Guideline of Anti-Money Laundering and Counter-Terrorist Financing. The changes seek to make the guidelines for Associated Entities more useful and relevant, while also keeping them in line with international standards.

With the launch of the consultation, market participants and interested parties can now submit their feedback to the watchdog. According to the statement, the regulator welcomes feedback and amendments to the proposal by August 9, 2018.

Proposed amendments

The amendments aim to streamline the identification and verification processes when onboarding customers. According to the statement, this should allow licensed corporations the flexibility to adopt reasonable risk-based measures. It will also give them the ability to determine the extent of the verification process.

The changes also want to expand the definition of politically exposed persons, a term which describes someone who has been entrusted with a prominent public function. The regulator wants to include customers who have been entrusted with a prominent function by an international organization.

Commenting on the launch of the consultation, Ashley Alder, the SFC’s Chief Executive Officer said: "the SFC is committed to adhering to international AML/CFT standards to reinforce Hong Kong’s reputation as a major international financial center.

"In formulating the proposed amendments, we adopted a balanced regulatory approach to give firms flexibility while ensuring our requirements are effective to prevent money laundering and terrorist financing."

The adjustments also propose that licensed corporations can use technology to allow non-face-to-face account opening. However, this is only if they can clearly demonstrate they have adequate safeguards against impersonation risk.

Derivatives Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term

The SFC is also updating regulation in other areas of Hong Kong's securities and futures markets. Only last week, Finance Magnates reported that the watchdog announced the conclusion of its consultation on over-the-counter (OTC) derivatives regulation.

The consultation included proposals to mandate the use of legal entity identifiers (LEIs), expand firms’ clearing Obligations Obligations In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you In finance, an obligation is a financial responsibility where the terms of a contract must be met. Should an obligation between parties fail then the party who is at default may face legal action. In this scenario, the guilty party will not only have to agree to pay the set amount to fulfill the contractual arrangement but may also be responsible for covering all legal proceedings cost. Routine payments or outstanding debt of any kind are considered financial obligations, so if someone owes you Read this Term and enforce a trading determination process for introducing a platform trading obligation.