Regulatory Alerts2023-07-28
Added · Updated
Streamlined approach for compliance with suitability obligations when dealing with sophisticated professional investors
The Securities and Futures Commission issues guidance allowing intermediaries to apply a proportionate, risk-based streamlined approach for suitability obligations when dealing with sophisticated professional investors. This framework permits reduced procedural requirements, such as waived risk matching and detailed product explanations, provided investors meet strict financial, knowledge, and experience criteria. Intermediaries must secure written consent, define eligible product categories and investment thresholds, and conduct annual reviews to ensure ongoing compliance and client awareness of associated risks.
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