Hong Kong SFC Proposed to Amend Financial Resources Rules (FRR) & Guidelines to Implement Internationally Comparable Capital Requirements for Licensed Corporations (LCs) in OTC (Over-the-Counter) Derivative Activities
15th July | Hong Kong
The Hong Kong Securities and Futures Commission (SFC) has launched a public consultation, proposing to amend the Financial Resources Rules (FRR) & guidelines to implement internationally comparable capital requirements for Licensed Corporations (LCs) in OTC (Over-the-Counter) derivative activities. Hong Kong SFC (14/7/25): “The Securities and Futures Commission (SFC) today launched a public consultation on draft amendments to the Securities and Futures (Financial Resources) Rules (FRR) and related guidelines for implementing a set of internationally comparable capital requirements for licensed corporations (LCs) engaging in over-the-counter derivative activities (OTCD capital requirements) (Note 1). Under the proposal, the OTCD capital requirements previously proposed (Note 2) have been fine-tuned with reference to recent changes to Hong Kong’s Banking (Capital) Rules and the Basel Framework (Note 3). The capital requirements for inter-dealer brokers will also be significantly lowered and transfer pricing treatments for LCs will be simplified to reflect the comments received during the SFC’s 2017 consultation (Note 4). In addition, the SFC proposed various other FRR changes to support LCs’ business development and diversification. These include measures to facilitate LCs’ trading of stocks in Mainland China and emerging markets, commodities and carbon products, as well as digital asset futures and options on licensed virtual asset trading platforms. Also, to drive Hong Kong’s development as a regional fixed income and currency hub, the SFC proposed to exempt the capital requirements for centrally-cleared repurchase transactions (repos) to promote their central clearing in Hong Kong and the development of the city’s inter-dealer repo market (Note 5). In the meantime, the SFC published conclusions on certain FRR changes which it previously consulted on. The public is invited to submit their written comments on the consultation by 13 October 2025 via the SFC website (www.sfc.hk), by email to [email protected], by post or by fax to 2523 4598.”
“ Hong Kong SFC Proposed to Amend Financial Resources Rules (FRR) & Guidelines to Implement Internationally Comparable Capital Requirements for Licensed Corporations (LCs) in OTC (Over-the-Counter) Derivative Activities “
Hong Kong SFC Proposed to Amend Financial Resources Rules (FRR) & Guidelines to Implement Internationally Comparable Capital Requirements for Licensed Corporations (LCs) in OTC (Over-the-Counter) Derivative Activities
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