On October 22, 2025, the SFC proposes to enhance Hong Kong’s retail fund code to bolster global competitiveness through aligning with international standards and expanding product offerings for investors.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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SPOTLIGHT ON
FAMILY OFFICES
On October 22, 2025, the Securities and Futures Commission ("SFC") initiated a three-month consultation on proposed revisions to the Code on Unit Trusts and Mutual Funds (UT Code). The objective is to align Hong Kong’s regulatory framework with global standards and expand investment products for investors.
Key changes to the UT Code include enabling an alternative approach for managing derivative investments in retail funds, updating guidelines for liquidity risk management, and strengthening requirements for money market funds. These amendments seek to foster market growth and bolster Hong Kong’s asset management sector.
Consequently, the SFC has proposed corresponding changes to relevant provisions within the SFC Code on MPF Products, the Code on Pooled Retirement Funds, the Code on Investment-Linked Assurance Schemes, and the Code on Real Estate Investment Trusts.
To facilitate access to private markets for retail investors, the SFC will first allow listed closed-ended alternative assets funds and then offer greater flexibility to SFC-authorized unlisted funds to invest a larger portion in illiquid assets, with stringent safeguards in place.
The public is encouraged to provide feedback to the SFC by January 21, 2026, through the SFC website, email, post, or fax to 2877 0318.
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