The HKMA and SFC have issued a joint consultation on the annual update to the Financial Services Providers ("FSP") list under the OTC derivatives regulatory regime. This update, if adopted, will add one entity to the list and will take effect on 1 January 2026. Interested parties can submit comments by 16 May 2025.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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The Hong Kong Monetary Authority ("HKMA") and the Securities and Futures Commission ("SFC") have released a joint consultation today (17 April) regarding an update to the Financial Services Providers ("FSP") List under the over-the-counter ("OTC") derivatives clearing regime. Following the latest annual review, the regulatory bodies propose adding one entity to ensure the list's continued relevance and appropriateness. This update, if adopted, is slated to come into effect on 1 January 2026.
The role of Financial Services Providers ("FSPs") is integral to the clearing regime, facilitating the identification of major OTC derivatives dealers outside Hong Kong. Central clearing is mandated for certain transactions between major dealers outside Hong Kong (i.e., FSPs) and prescribed persons, including authorized institutions, approved money brokers, and licensed corporations.
Entities eligible for inclusion on the FSP List must satisfy the following criteria: (a) They are part of a group of companies listed on either the Financial Stability Board's global systemically important banks list or the OTC Derivatives Supervisors Group's dealer groups; (b) They are clearing members of the largest central counterparties offering clearing services for interest rate swaps in the United States, Europe, Japan, and Hong Kong.
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