The article announces an update by the Securities and Futures Commission ("SFC") on May 30, 2025, recognizing non-face-to-face ("NFTF") client onboarding for intermediaries, driven by digitalization and automation. Updated guidelines for NFTF account opening methods include recognized certification services for identity verification, such as the Personal (Remote) ID-Cert Class 12 for overseas investors with ICAO-compliant ePassports. The SFC also adopts iAM Smart for identity verification, emphasizing its use in the iAM Smart Sandbox Programme. Additionally, the list of eligible jurisdictions for remote client onboarding was expanded to include 15 new countries. The article highlights the importance of cybersecurity and regulatory considerations for intermediaries.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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On May 30, 2025, the Securities and Futures Commission ("SFC") recognized the significance of non-face-to-face ("NFTF") client onboarding for intermediaries in an increasingly digital and automated business environment.
The circular issued by the SFC on this date updated the current five acceptable methods for NFTF account opening, which are published on the SFC's designated webpage.
Certification services recognized by the Electronic Transactions Ordinance (Cap. 553) can be used for client identity verification during NFTF account opening. A list of these recognized certificates is available on the website of the Digital Policy Office ("DPO").
Currently, certification services from recognized certification authorities ("CA") can be utilized remotely through smartphones equipped with near field communication ("NFC") technology.
More convenient methods for remote onboarding of overseas investors are now available to intermediaries. For instance, the Personal (Remote) ID-Cert Class 12, issued by Digi-Sign Certification Services Limited, can be subscribed to by overseas investors holding ICAO-compliant ePassports.
Intermediaries can consider using such certification services to verify the identities of overseas investors for remote client onboarding. Currently, more than 100 overseas jurisdictions have issued ICAO-compliant ePassports.
Appendix A provides illustrative processes of using certification services to open accounts for overseas investors holding ICAO-compliant ePassports.
On May 30, 2025, the HKSAR Government introduced iAM Smart in December 2020, a one-stop digital services platform to promote digital transformation in Hong Kong.
The SFC has accepted the use of iAM Smart for client identity verification in account opening since its launch. It is now listed as an acceptable approach for NFTF account opening using both iAM Smart and iAM Smart+ versions on the designated webpage.
Some intermediaries have already adopted iAM Smart for remote client onboarding and testing its application in account opening. The iAM Smart Sandbox Programme, initiated by the DPO in collaboration with Cyberport, aims to facilitate iAM Smart adoption and encourages intermediaries to join.
Illustrative processes for the connection to and adoption of iAM Smart for account opening are outlined in Appendix B.
On May 30, 2025, the SFC published an updated list of eligible jurisdictions for remote onboarding of overseas individual clients, which includes 15 additional jurisdictions, effective immediately. The jurisdictions are Argentina, Brazil, France, Germany, Greece, India, Indonesia, Japan, Korea, Luxembourg, Netherlands, New Zealand, Saudi Arabia, South Africa, and Turkey.
The updated list considers the results of Financial Action Task Force mutual evaluations and includes considerations for investment and capital transfer restrictions. Adequate cybersecurity controls are necessary to protect against emerging threats.
The SFC will continue to monitor technological developments and communicate with the industry about the use of technology for reliable client identity verification. Any inquiries regarding the circular should be directed to Ms. Denise Chan at 2231 1188.
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