On January 30, 2026, the Securities and Futures Commission ("SFC") issued a circular highlighting serious deficiencies in the preparation of listing documents and resources issues among sponsors. Sponsors were directed to conduct internal reviews and provide detailed reports. The SFC warned that vetting processes for listing applications could be suspended if responses were incomplete or unsatisfactory.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
SFC Regulation of Virtual Asset Trading Platforms: The Emerging Hong Kong Framework
SFC proposes new regulation of virtual assets through licensing of operators of cryptocurrency and other digital asset trading platforms
Market Misconduct Tribunal: A Guide to Penalties and Other Consequences for Misuse of Insider Information
Market Misconduct Tribunal proceedings for mishandling of insider information can result in fines and disgorgement orders
SPOTLIGHT ON
FAMILY OFFICES
On January 30, 2026, the Securities and Futures Commission ("SFC") released a circular expressing significant concerns about the preparation of listing documents by sponsors. The SFC and The Stock Exchange of Hong Kong Limited ("SEHK") highlighted notable deficiencies and non-compliance with regulatory procedures, indicating that certain sponsors may lack a thorough understanding of listing applicants or adequate due diligence.
The circular also noted severe resource issues, including over-reliance on external parties, insufficient capacity among sponsor principals, and insufficient knowledge of Hong Kong IPOs among staff. The SFC directed 13 sponsors to undergo comprehensive reviews and all sponsors to report their resource ratios. A thematic review of sponsors is planned.
For current listing applications, the SFC warned that responses and listing documents must be complete and satisfactory to avoid suspension of the vetting process. As of December 31, 2025, vetting had been suspended for 16 applications. Sponsors involved in more than six active listing engagements must submit rectification and resource plans. Tighter examination requirements were implemented for those engaged in IPO sponsor work.
The SFC's Chief Executive Officer, Ms. Julia Leung, stressed the critical role of sponsors in maintaining the quality of Hong Kong’s capital market. She urged sponsors and external parties to avoid overcommitment and ensure the quality of their work. Sponsors exhibiting substandard conduct may face restrictions on their business scope and active listing engagements.
View the full article:Source
