SFC opens consultation on revisions to HK retail fund code

It aims to meet global standards.

The Securities and Futures Commission (SFC) has launched a three-month consultation on proposed amendments to the Code on Unit Trusts and Mutual Funds (UT Code).

The changes aim to align Hong Kong’s regulatory framework for SFC-authorised funds with international standards and expand investment options for the public.

Key proposals include introducing an alternative approach to managing derivative investments in retail funds, tightening liquidity risk management requirements, and updating rules for money market funds.

The SFC said the revisions will support market growth and strengthen the resilience of Hong Kong’s asset management sector.

The SFC will adopt a phased approach to increase retail access to private markets.

Initially, it will allow listed closed-ended alternative asset funds, followed by unlisted funds that can hold more illiquid assets, subject to strong liquidity safeguards.

Related changes are also proposed for the SFC Code on MPF Products, Code on Pooled Retirement Funds, Code on Investment-Linked Assurance Schemes, and Code on Real Estate Investment Trusts.