What’s new: Hong Kong’s securities regulator said it will free some family offices that serve single families from licensing requirements as it seeks to draw more of the private wealth management firms favored by the super rich to the city.
Single-family offices — set up for members of a lone family — are “not required to apply for a license under the Securities and Futures Ordinance (SFO)” as long as they are not being run as a business, such as by pursuing profit, according to a reference guide released by the Securities and Futures Commission (SFC) on Wednesday.
In Hong Kong, financial firms that serve a broader clientele but provide services that are similar to those offered by a family office, such as asset management firms and securities brokerages, are required to obtain licenses from the SFC.
Meanwhile, family offices that serve more than one family are “more likely to need a license” under the SFO, as they typically operate as for-profit companies, according to the reference guide.
The licenses commonly obtained by multi-family offices include those for dealing in securities, advising on securities, and asset management, it said.
The background: Hong Kong has made attracting family offices a key goal under Chief Executive John Lee Ka-chiu. The government aims to get at least 200 family offices to set up or expand their operations in the financial hub by 2025, Lee said in October.
The city plans to exempt the profits of certain family-owned investment holding vehicles from taxes, Financial Secretary Paul Chan Mo-po said last month.
Related: Hong Kong Steps Up Efforts to Lure Billionaires’ Business
Contact reporter Zhang Ziyu (ziyuzhang@caixin.com) and editor Michael Bellart (michaelbellart@caixin.com)
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