Regulatory Alerts2018-08-24
Added · Updated
Online Distribution and Advisory Platforms for Non-SFO-regulated Structured Investment Products
The Securities and Futures Commission establishes suitability requirements for the online distribution and advisory of non-SFO-regulated structured investment products. The framework distinguishes between standardized deposits and complex products, mandating compliance with specific conduct codes when solicitation or recommendation occurs. Eligibility criteria include verifying sufficient investment experience, ensuring low concentration, and confirming principal protection status for eligible investors.
Appendix Online Distribution and Advisory Platforms for Non-SFO-regulated Structured Investment Products 1 It refers to customers who have executed five or more transactions in the product of the subject transaction within the past three years. 2 It means investors will receive at least 100% of the principal amount if the investors hold the investment until maturity and there is no issuer default. 3 Meaning investment in a specific product on a cumulative basis is within a reasonable threshold as determined by the AI. No Yes Yes No Yes No Comply with 5.1A and 5.3 of SFC’s Code of Conduct Suitability Requirement Suitability Requirement Low concentration? 3 100% Principal-protected? 2 Have sufficient investment experience? 1 Without solicitation or recommendation With solicitation or recommendation Non-SFO-regulated structured investment products Standardised Non-SFO-regulated Structured Deposits
- non-leveraged currency-linked deposits of a major currency pair
- non-leveraged interest rate-linked deposits Complex products
- non-SFO-regulated structured investment products(other than Standardised Non-SFO-regulated Structured Deposits)
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