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1、Laws,Regulations and Financial Services in Hong KongFebruary 2023161522IntroductionModule 1 Deal Making and Finance Hong Kong as the ideal deal-making hub The mergers and acquisitions marketModule 2-Dispute Resolution&Court System Alternative dispute resolutionThe Basic Law Hong Kongs judicial indep

2、endenceEnforceable private and public rightsModule 3 Legal ProfessionAttractiveness for legal professionals Solicitors and barristers An alternative career for legal professionals Opportunities brought by the integration with the Greater Bay AreaModule 4 Regulators A world-class financial centreThe

3、powers of the regulatorsThe regulatory systems Differences among Mainland China,Hong Kong and United KingdomConclusionAppendix Appendix 1.Roles and functions of the five regulatory bodies and the exchange276 121517172127313131222424263334 34Contents161522IntroductionModule 1 Deal Making and Finance

4、Hong Kong as the ideal deal-making hub The mergers and acquisitions marketModule 2-Dispute Resolution&Court System Alternative dispute resolutionThe Basic Law Hong Kongs judicial independenceEnforceable private and public rightsModule 3 Legal ProfessionAttractiveness for legal professionals Solicito

5、rs and barristers An alternative career for legal professionals Opportunities brought by the integration with the Greater Bay AreaModule 4 Regulators A world-class financial centreThe powers of the regulatorsThe regulatory systems Differences among Mainland China,Hong Kong and United KingdomConclusi

6、onAppendix Appendix 1.Roles and functions of the five regulatory bodies and the exchange276 12151717 2127313131222424263334 34ContentsMr Barry ChanManaging Director,Head of Investment Banking,Hong Kong,China International Capital CorporationMs Amy Lo Co-Head Wealth Management Asia Pacific,UBS Global

7、 Wealth Management,Head and Chief Executive,UBS Hong Kong12Laws,Regulations and Financial Services in Hong KongIntroduction Hong Kongs continued success as one of the worlds leading financial centres,bridging Mainland and global markets,is built on its strong fundamentals.Among which,the citys robus

8、t legal system,underpinned by the strong rule of law and long-standing judicial independence,provides a solid foundation for an open,efficient and secure business environment.Relatedly,Hong Kong enjoys world-renowned reputation as one of the global legal and dispute resolution service hubs.Endowed w

9、ith these strengths,international financial services firms choose Hong Kong as their operational hub in Asia,with the confidence being supported by the unparalleled access to world class professional legal and financial services.In this context,the Financial Services Development Council(FSDC)initiat

10、ed a qualitative study with an aim of understanding the key attributes of Hong Kongs legal system that foster and contribute to the development and enhancement of the financial services industry.With an intention to visit the topic from the perspective of legal professionals and industry leaders of

11、different sectors,the FSDC interviewed over a dozen leading practitioners of various background 14 of such interviews were videotaped and broken down into four modules and this report comprises views from such an exercise.The four modules of the report are set out as follows:Dr Levin Wang Chief Exec

12、utive Officer,Huatai Financial Holdings(Hong Kong)Ltd.Laws,Regulations and Financial Services in Hong KongScan to watch the videoModule 1 Deal Making and FinanceThis module explores the attributes that build and define the ecosystem of Hong Kong as an ideal deal-making hub.Notably,having a trusted l

13、egal and regulatory system,being one of the freest economies in the world and its proximity to Mainland China are the key reasons.Speakers include:Mr Barry ChanManaging Director,Head of Investment Banking,Hong Kong,China International Capital CorporationMs Amy Lo Co-Head Wealth Management Asia Pacif

14、ic,UBS Global Wealth Management,Head and Chief Executive,UBS Hong Kong12Laws,Regulations and Financial Services in Hong KongIntroduction Hong Kongs continued success as one of the worlds leading financial centres,bridging Mainland and global markets,is built on its strong fundamentals.Among which,th

15、e citys robust legal system,underpinned by the strong rule of law and long-standing judicial independence,provides a solid foundation for an open,efficient and secure business environment.Relatedly,Hong Kong enjoys world-renowned reputationas one of the global legal and dispute resolution service hu

16、bs.Endowed with these strengths,international financial services firms choose Hong Kong as their operational hub in Asia,with the confidence being supported by the unparalleled access to world class professional legal and financial services.In this context,the Financial Services Development Council(

17、FSDC)initiated a qualitative study with an aim of understanding the key attributes of Hong Kongs legal system that foster and contribute to the development and enhancement of the financial services industry.With an intention to visit the topic from the perspective of legal professionals and industry

18、 leaders of different sectors,the FSDC interviewed over a dozen leading practitioners of various background 14 of such interviews were videotaped and broken down into four modules and this report comprises views from such an exercise.The four modules of the report are set out as follows:Dr Levin Wan

19、g Chief Executive Officer,Huatai Financial Holdings(Hong Kong)Ltd.Laws,Regulations and Financial Services in Hong KongScan to watch the videoModule 1 Deal Making and FinanceThis module explores the attributes that build and define the ecosystem of Hong Kong as an ideal deal-making hub.Notably,having

20、 a trusted legal and regulatory system,being one of the freest economies in the world and its proximity to Mainland China are the key reasons.Speakers include:4Module 3 Legal ProfessionHong Kongs effective and sound legal system is underpinned by a broad and deep pool of world-class legal profession

21、als,forming a unique competitive edge in the legal and dispute resolution sectors.In addition,legal practitioners in Hong Kong can enjoy the enormous opportunities arising from the integration with the GBA.For example,the introduction of the GBA Legal Professional Examination and other pilot measure

22、s to facilitate the flow of legal talents within the GBA.Speakers include:3Mr Laurence Li SC,JP,Chairman,Financial Services Development CouncilMr Frederick Hui Partner,Solicitor Advocate,Zhong Lun Law Firm LLPDr Anthony Neoh KC,SC,JP,Chair,Asian Academy of International LawMr Chak-ming Chan Presiden

23、t,The Law Society of Hong KongMs Roanna Kwong Senior Associate,Allen&OveryDr Anthony Neoh KC,SC,JP,Chair,Asian Academy of International LawMr Phillip Meyer General Counsel,Chief Compliance Officer&Co-Chief Operating Officer,Oasis Management Company Ltd.Laws,Regulations and Financial Services in Hong

24、 KongScan to watch the videoModule 2 Dispute Resolution&Court SystemIn the National 14th Five-Year Plan and the Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area(GBA),both plans confirmed the national policy towards supporting Hong Kong in being the centre for international

25、 legal and dispute resolution services in the Asia-Pacific region.The module provides an overview of Hong Kongs dispute resolution sector and the court system,covering elements including but not limited to,the Basic Law,judicial review and alternative dispute resolution.Speakers include:Scan to watc

26、h the video4Module 3 Legal ProfessionHong Kongs effective and sound legal system is underpinned by a broad and deep pool of world-class legal professionals,forming a unique competitive edge in the legal and dispute resolution sectors.In addition,legal practitioners in Hong Kong can enjoy the enormou

27、s opportunities arising from the integration with the GBA.For example,the introduction of the GBA Legal Professional Examination and other pilot measures to facilitate the flow of legal talents within the GBA.Speakers include:3Mr Laurence Li SC,JP,Chairman,Financial Services Development CouncilMr Fr

28、ederick Hui Partner,Solicitor Advocate,Zhong Lun Law Firm LLPDr Anthony Neoh KC,SC,JP,Chair,Asian Academy of International LawMr Chak-ming Chan President,The Law Society of Hong KongMs Roanna Kwong Senior Associate,Allen&OveryDr Anthony Neoh KC,SC,JP,Chair,Asian Academy of International LawMr Philli

29、p Meyer General Counsel,Chief Compliance Officer&Co-Chief Operating Officer,Oasis Management Company Ltd.Laws,Regulations and Financial Services in Hong KongScan to watch the videoModule 2 Dispute Resolution&Court SystemIn the National 14th Five-Year Plan and the Outline Development Plan for the Gua

30、ngdong-Hong Kong-Macao Greater Bay Area(GBA),both plans confirmed the national policy towards supporting Hong Kong in being the centre for international legal and dispute resolution services in the Asia-Pacific region.The module provides an overview of Hong Kongs dispute resolution sector and the co

31、urt system,covering elements including but not limited to,the Basic Law,judicial review and alternative dispute resolution.Speakers include:Scan to watch the video56Ms Ding Chen Chief Executive Officer,CSOP Asset Management Ltd.Ms Virginia Lee Partner,Clifford ChanceMr Evan Auyang Group President,An

32、imoca BrandsMs Winnie Wong Chi-shun CEO&Executive Director,Asia Insurance,Avo InsuranceMr Craig Katerberg Chief Legal&Corporate Affairs Officer,Budweiser Brewing APAC Ltd.Module 1 Deal Making and FinanceDeal-making is at the heart of all commercial and financial activities.Flexibility,transparency a

33、nd certainty are important attributes in the deal-making process,which can be presented in the form of(i)freedom to negotiate,(ii)fairness,(iii)flexibility in reaching agreements,and ultimately,(iv)the precision in defining the rights,obligations and liabilities arising as a result of details.All th

34、ese require a sound rule of law.Hong Kong as the ideal deal-making hubDeal-making in Hong Kong is well supported by its effective and strong legal framework and world-class professional services,etc.Furthermore,its“super-connector”role under the“One Country,TwoSystems”principle,remarkably bridges Ma

35、inland China and the rest of the world,and facilitates the deal-making process.Hence,enabling the city to distinguish itself from other leading economies and cement Hong Kongs standing as an ideal deal-making hub.Sophisticated legal and regulatory systemHong Kongs prosperity and stability as an inte

36、rnational financial centre is premised upon the strong rule of law and judicial independence in its legal framework.Under the common law system,Hong Kong has sophisticated modern laws to facilitate a broad range of deal-making,commercial fairness and enforceability of rights and obligations.The city

37、 also has a reliable and transparent dispute resolution process,supporting deal-making across a broad array of sectors and products by enforcing rights and obligations arising from deals,and providing remedies for disputes and defaults.In addition,Hong Kongs courts have a long-track record when it c

38、omes to the adjudication of commercial and financial cases.Specifically,the strength and comprehensiveness of Hong Kongs commercial and financial related laws are well recognised.The regulatory framework(Table 1)covers a wide range of business activities,ensuring that parties rights are protected.Ad

39、ditionally,effective law enforcement agencies are in place to prevent fraud,and hence,maximising deal makers confidence in Hong Kong.Laws,Regulations and Financial Services in Hong KongScan to watch the videoModule 4 RegulatorsThis module provides an overview of the principal regulators and the exch

40、ange in Hong Kongs financial system,who share a collective goal to maintain the citys financial stability and integrity.Through the sharing from private sector representatives on their experience to deal with regulators,one can observe how the regulators cooperate closely to adapt to global trends a

41、nd market innovation.Speakers include:56Ms Ding Chen Chief Executive Officer,CSOP Asset Management Ltd.Ms Virginia LeePartner,Clifford ChanceMr Evan Auyang Group President,Animoca BrandsMs Winnie Wong Chi-shun CEO&Executive Director,Asia Insurance,Avo InsuranceMr Craig Katerberg Chief Legal&Corporat

42、e Affairs Officer,Budweiser Brewing APAC Ltd.Module 1 Deal Making and FinanceDeal-making is at the heart of all commercial and financial activities.Flexibility,transparency and certainty are important attributes in the deal-making process,which can be presented in the form of(i)freedom to negotiate,

43、(ii)fairness,(iii)flexibility in reaching agreements,and ultimately,(iv)the precision in defining the rights,obligations and liabilities arising as a result of details.Allthese require a sound rule of law.Hong Kong as the ideal deal-making hubDeal-making in Hong Kong is well supported by its effecti

44、ve and strong legal framework and world-class professional services,etc.Furthermore,its“super-connector”role under the“One Country,Two Systems”principle,remarkably bridges Mainland China and the rest of the world,and facilitates the deal-making process.Hence,enabling the city to distinguish itself f

45、rom other leading economies and cement Hong Kongs standing as an ideal deal-making hub.Sophisticated legal and regulatory systemHong Kongs prosperity and stability as an international financial centre is premised upon the strong rule of law and judicial independence in its legal framework.Under the

46、common law system,Hong Kong has sophisticated modern laws to facilitate a broad range of deal-making,commercial fairness and enforceability of rights and obligations.The city also has a reliable and transparent dispute resolution process,supporting deal-making across a broad array of sectors and pro

47、ducts by enforcing rights and obligations arising from deals,and providing remedies for disputes and defaults.In addition,Hong Kongs courts have a long-track record when it comes to the adjudication of commercial and financial cases.Specifically,the strength and comprehensiveness of Hong Kongs comme

48、rcial and financial related laws are well recognised.The regulatory framework(Table 1)covers a wide range of business activities,ensuring that parties rights are protected.Additionally,effective law enforcement agencies are in place to prevent fraud,and hence,maximising deal makers confidence in Hon

49、g Kong.Laws,Regulations and Financial Services in Hong KongScan to watch the videoModule 4 RegulatorsThis module provides an overview of the principal regulators and the exchange in Hong Kongs financial system,who share a collective goal to maintain the citys financial stability and integrity.Throug

50、h the sharing from private sector representatives on their experience to deal with regulators,one can observe how the regulators cooperate closely to adapt to global trends and market innovation.Speakers include:ExamplesDescription Companies(Winding Up and Miscellaneous Provisions)Ordinance(Cap.32)T

51、o handle issues in relation to bankruptcy and insolvency Prevention of Bribery Ordinance(Cap.201)To detect,enforce,and deter fraud and corruption Banking Ordinance(Cap.155)Banking(Capital)Rules(Cap.155L)Banking(Disclosure)Rules(Cap.155M)Banking(Liquidity)Rules(Cap.155Q)Banking(Exposure Limits)Rules(

52、Cap.155S)Insurance Ordinance(Cap.41)To strengthen the protection in deal-making in the aspects of banking and insurance Competition Ordinance(Cap.619)To maintain a level playing fieldbetween parties Contracts(Rights of Third Parties)Ordinance(Cap.623)To provide for the enforcement of contractual ter

53、ms by third parties Electronic Transactions Ordinance(Cap.553)To facilitate the use of electronic transactions for commercial and other purposes,including the use of electronic signatures and records Unconscionable Contracts Ordinance(Cap.458)Sale of Goods Ordinance(Cap.26)Supply of Services(Implied

54、 Terms)Ordinance(Cap.457)To provide balanced consumer protection in a modern approachTable 1:Examples of the legal infrastructure and regulatory framework(Non-exhaustive)The flexibility,transparency and certainty that Hong Kongs judicial system offers are well acknowledged.In 2021 Worldwide Governan

55、ce Indicators,Hong Kong ranked No.3 in Asia under the dimension of“Rule of Law”.1781 World Bank,2021 Worldwide Governance Indicators,2021,http:/info.worldbank.org/governance/wgi/Home/Reports 2 Basic Law,https:/www.basiclaw.gov.hk/en/basiclaw/chapter5.html#:text=Article%20112&text=The%20Hong%20Kong%2

56、0dollar%20shall,and%20out%20of%20the%20Region 3 Fraser institute,Economic Freedom of the World:2022 Annual Report,September 2022,https:/www.fraserinstitute.org/sites/default/files/economic-free dom-of-the-world-2022.pdf“Hong Kong is the only Chinese jurisdiction whose financial system is built upon

57、common law,which is well understood by international investors and companies alike.”Ms Amy LoCo-Head Wealth Management Asia Pacific,UBS Global Wealth Management,Head and Chief Executive,UBS Hong KongOne of the freest economies in the worldHong Kong is an open market free flow of capital within,into

58、and out of Hong Kong is guaranteed under Article 112 of the Basic Law2,coupled with the benefits from free flow of information and people.Such an open market supports both the buy side and the sell side in deal-making,upholding confidence of organisations and individuals across the globe in conducti

59、ng deals in Hong Kong.Hong Kong has always been crowned as the worlds freest economy in the Economic Freedom of the World Annual Report published by the Fraser Institute since 1996.Among which,they have ranked the city first in“Freedom to Trade Internationally”and“Regulation”since 2018.3Remarkably,l

60、everaging such strengths,the city has ranked as the worlds largest initial public offering(IPO)market for seven times in the past 14 years.In addition,as a service-oriented economy,Hong Kong has been active in negotiation of trade in services agreement.The city has been a member of the World Trade O

61、rganization(WTO)since 1995.Laws,Regulations and Financial Services in Hong KongExamplesDescription Companies(Winding Up and Miscellaneous Provisions)Ordinance(Cap.32)To handle issues in relation to bankruptcy and insolvency Prevention of Bribery Ordinance(Cap.201)To detect,enforce,and deter fraud an

62、d corruption Banking Ordinance(Cap.155)Banking(Capital)Rules(Cap.155L)Banking(Disclosure)Rules(Cap.155M)Banking(Liquidity)Rules(Cap.155Q)Banking(Exposure Limits)Rules(Cap.155S)Insurance Ordinance(Cap.41)To strengthen the protection indeal-making in the aspects of banking and insurance Competition Or

63、dinance(Cap.619)To maintain a level playing fieldbetween parties Contracts(Rights of Third Parties)Ordinance(Cap.623)To provide for the enforcement of contractual terms by third parties Electronic Transactions Ordinance(Cap.553)To facilitate the use of electronic transactions for commercial and othe

64、r purposes,including the use of electronic signatures and records Unconscionable Contracts Ordinance(Cap.458)Sale of Goods Ordinance(Cap.26)Supply of Services(Implied Terms)Ordinance(Cap.457)To provide balanced consumer protection in a modern approachTable 1:Examples of the legal infrastructure and

65、regulatory framework(Non-exhaustive)The flexibility,transparency and certainty that Hong Kongs judicial system offers are well acknowledged.In 2021 Worldwide Governance Indicators,Hong Kong ranked No.3 in Asia under the dimension of“Rule of Law”.1781 World Bank,2021 Worldwide Governance Indicators,2

66、021,http:/info.worldbank.org/governance/wgi/Home/Reports 2 Basic Law,https:/www.basiclaw.gov.hk/en/basiclaw/chapter5.html#:text=Article%20112&text=The%20Hong%20Kong%20dollar%20shall,and%20out%20of%20the%20Region 3 Fraser institute,Economic Freedom of the World:2022 Annual Report,September 2022,https

67、:/www.fraserinstitute.org/sites/default/files/economic-free dom-of-the-world-2022.pdf “Hong Kong is the only Chinese jurisdiction whose financial system is built upon common law,which is well understood by international investors and companies alike.”Ms Amy LoCo-Head Wealth Management Asia Pacific,U

68、BS Global Wealth Management,Head and Chief Executive,UBS Hong KongOne of the freest economies in the worldHong Kong is an open market free flow of capital within,into and out of Hong Kong is guaranteed under Article 112 of the Basic Law2,coupled with the benefits from free flow of information and pe

69、ople.Such an open market supports both the buy side and the sell side in deal-making,upholding confidence of organisations and individuals across the globe in conducting deals in Hong Kong.Hong Kong has always been crowned as the worlds freest economy in the Economic Freedom of the World Annual Repo

70、rt published by the Fraser Institute since 1996.Among which,they have ranked the city first in“Freedom to Trade Internationally”and“Regulation”since 2018.3 Remarkably,leveraging such strengths,the city has ranked as the worlds largest initial public offering(IPO)market for seven times in the past 14

71、 years.In addition,as a service-oriented economy,Hong Kong has been active in negotiation of trade in services agreement.The city has been a member of the World Trade Organization(WTO)since 1995.Laws,Regulations and Financial Services in Hong Kong9104 HKSAR,Press Releases Inaugural GBA Legal Profess

72、ional Examinations to be held next January,November 2020,https:/www.info.gov.hk/gia/general/202011/20/P2020112000797.htm5 Constitutional and Mainland Affairs Bureau,Greater Bay Area Website,accessed on 14 Oct 2022,https:/www.bayarea.gov.hk/en/opportunities/cepa.html 6 HSBC,HSBC Navigator 2021,2021,h

73、ttps:/.hk/en-gb/campaigns/hsbc-navigatorProximity to Mainland ChinaThe connectivity between Hong Kong and Mainland China bolsters Hong Kongs role as an international deal-making hub.With an aim of strengthening the connectivity,Hong Kong has been exploring legal enhancement with Mainland China under

74、 the principle of“one country,two systems and three jurisdictions”in the GBA.For instance,the recent measures include:The Interim Measures Arrangement for arbitration took effect in October 2019,where Hong Kong has become the first jurisdiction outside of Mainland China,permitting parties to arbitra

75、l proceedings to apply to Mainland China courts for interim measures(such as property freezing and evidence collection).Hong Kong and Mainland China jointly initiated a co-operation mechanism for cross-boundary insolvency and debt restructuring on 14 May 2021.As a result,Hong Kong becomes the only j

76、urisdiction outside of Mainland China that allows mutual recognition of and assistance to insolvency proceedings.The Mainland Judgments in Civil and Commercial Matters(Reciprocal Enforcement)Ordinance(“Ordinance”)was passed by the Legislative Council on 26 October 2022.The Ordinance seeks to provide

77、 for the enforcement in Hong Kong of judgments in civil and commercial matters given in the Mainland,and for facilitating the recognition and enforcement in the Mainland of judgments in civil and commercial matters given in Hong Kong.It aims to give effect to the Arrangement on Reciprocal Recognitio

78、n and Enforcement of Judgments in Civil and Commercial Matters signed between Hong Kong and the Mainland in January 2019.The pilot measures for Hong Kong and Macao legal practitioners to obtain Mainland practice qualifications were launched in October 2020.The measures enable the qualified practitio

79、ners to practise law in the nine Mainland cities in the GBA on specified civil and commercial matters upon passing the GBA Legal Professional Examination.4 In addition,with an aim of strengthening practical knowledge on the courts handling of legal matters in Mainland China,practical trainings are o

80、ffered to eligible practitioners by the Department of Justice of Hong Kong and the Supreme Peoples Court.5 With regards to economic and trade co-operations,Hong Kong and Mainland China have made significant achievements throughout the past two decades(Table 2).At present,the number of foreign entiti

81、es entering the market has been booming alongside the development of the GBA and the Belt and Road Initiative.According to the HSBC Navigator 2021,75%of the surveyed international companies planned to expand their business in the GBA in the next three years,and most of them prefer having Hong Kong a

82、s the entry point.6Table 2:Milestones of Mainland China and Hong Kongs connectivity initiatives in the financial market200220112015201720212003201420162018Mainland and Hong Kong Closer Economic Partnership Arrangement(CEPA)Shanghai-Hong Kong Stock ConnectShenzhen-Hong Kong Stock ConnectHKEX introduc

83、ed new chapters to expand the existing listing regime:Permitting listings of biotech issuers that do not meet any of the Main Board financial eligibility tests;Permitting listings of companies with weighted voting right(WVR)structures;andEstablishing a new concessionarysecondary listing route for Gr

84、eater China and international companies that wish to secondary list in Hong KongQualified Foreign Institutional Investor(QFII)RMB Qualified Foreign Institutional Investor(RQFII)Mutual Recognition of FundsBond ConnectCross-boundary Wealth Management Connect;andSouthbound Trading under Bond ConnectYea

85、rConnectivity initiatives in the financial marketi.ii.iii.Laws,Regulations and Financial Services in Hong Kong9104 HKSAR,Press Releases Inaugural GBA Legal Professional Examinations to be held next January,November 2020,https:/www.info.gov.hk/gia/general/202011/20/P2020112000797.htm5 Constitutional

86、and Mainland Affairs Bureau,Greater Bay Area Website,accessed on 14 Oct 2022,https:/www.bayarea.gov.hk/en/opportunities/cepa.html6 HSBC,HSBC Navigator 2021,2021,https:/.hk/en-gb/campaigns/hsbc-navigatorProximity to Mainland ChinaThe connectivity between Hong Kong and Mainland China bolsters Hong Kon

87、gs role as an international deal-making hub.With an aim of strengthening the connectivity,Hong Kong has been exploring legal enhancement with Mainland China under the principle of“one country,two systems and three jurisdictions”in the GBA.For instance,the recent measures include:The Interim Measures

88、 Arrangement for arbitration took effect in October 2019,where Hong Kong has become the first jurisdiction outside of Mainland China,permitting parties to arbitral proceedings to apply to Mainland China courts for interim measures(such as property freezing and evidence collection).Hong Kong and Main

89、land China jointly initiated a co-operation mechanism for cross-boundary insolvency and debt restructuring on 14 May 2021.As a result,Hong Kong becomes the only jurisdiction outside of Mainland China that allows mutual recognition of and assistance to insolvency proceedings.The Mainland Judgments in

90、 Civil and Commercial Matters(Reciprocal Enforcement)Ordinance(“Ordinance”)was passed by the Legislative Council on 26 October 2022.The Ordinance seeks to provide for the enforcement in Hong Kong of judgments in civil and commercial matters given in the Mainland,and for facilitating the recognition

91、and enforcement in the Mainland of judgments in civil and commercial matters given in Hong Kong.It aims to give effect to the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters signed between Hong Kong and the Mainland in January 2019.The pilot measure

92、s for Hong Kong and Macao legal practitioners to obtain Mainland practice qualifications were launched in October 2020.The measures enable the qualified practitioners to practise law in the nine Mainland cities in the GBA on specified civil and commercial matters upon passing the GBA Legal Professio

93、nal Examination.4In addition,with an aim of strengthening practical knowledge on the courts handling of legal matters in Mainland China,practical trainings are offered to eligible practitioners by the Department of Justice of Hong Kong and the Supreme Peoples Court.5With regards to economic and trad

94、e co-operations,Hong Kong and Mainland China have made significant achievements throughout the past two decades(Table 2).At present,the number of foreign entities entering the market has been booming alongside the development of the GBA and the Belt and Road Initiative.According to the HSBC Navigato

95、r 2021,75%of the surveyed international companies planned to expand their business in the GBA in the next three years,and most of them prefer having Hong Kong as the entry point.6Table 2:Milestones of Mainland China and Hong Kongs connectivity initiatives in the financial market200220112015201720212

96、003201420162018Mainland and Hong Kong Closer Economic Partnership Arrangement(CEPA)Shanghai-Hong Kong Stock ConnectShenzhen-Hong Kong Stock ConnectHKEX introduced new chapters to expand the existing listing regime:Permitting listings of biotech issuers that do not meet any of the Main Board financia

97、l eligibility tests;Permitting listings of companies with weighted voting right(WVR)structures;andEstablishing a new concessionary secondary listing route for Greater China and international companies that wish to secondary list in Hong KongQualified Foreign Institutional Investor(QFII)RMB Qualified

98、 Foreign Institutional Investor(RQFII)Mutual Recognition of FundsBond ConnectCross-boundary Wealth Management Connect;andSouthbound Trading under Bond ConnectYearConnectivity initiatives in the financial marketi.ii.iii.Laws,Regulations and Financial Services in Hong Kong11127 HKSAR,Press Releases At

99、tracting China Concept Stock companies to list in Hong Kong,6 April 2022,https:/www.info.gov.hk/gia/general/202204/06/P2022040600276.htm?fontSize=1 8 SFC,SFC welcomes Central Governments support to enhance Hong Kongs IFC status,Sep 2022,https:/apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announc

100、ements/news/doc?refNo=22PR67 9 HKEX,Exchange Publishes Consultation Paper on New Listing Rules for Specialist Technology Companies,19 October 2022,https:/.hk/News/Regulatory-Announcements/2022/2210191news?sc_lang=enThe mergers and acquisitions marketAmong a broad-spectrum of deal-making activities,m

101、ergers&acquisitions(M&A)is attractive to most of the financial and professional services firms.M&As are,in a nutshell,transactions in which two companies consolidate or combine through various forms,such as stock purchase and asset purchase.Consistent with the global trend10,the M&A market in Mainla

102、nd China and Hong Kong recorded an increase in 2021 but a slight slowdown in 1H 2022-The M&A deal value in China,including Mainland China and Hong Kongs outbound transactions,fell from US$295.6 billion in 1H 2021 to US$236.7 billion in 1H 2022,representing a 20%decrease.The slower pace in global M&A

103、 activities earlier was due in part to the uncertainties brought by,for instance,the pandemic,geopolitical instability,etc.11Besides dealing with inbound and outbound M&A activities,there are opportunities for both private and public M&As in Hong Kong.Transactions relating to technology-related asse

104、ts were common targets in the recent couple of years,while other active sectors also include financial services,infrastructure and logistics,as well as media12Robust legal and financial advisory support throughout the entire M&A process in Hong KongLegal and financial advisory service supportIn the

105、M&A universe,the reputation of service providers is important and such is often developed through involvement in previous transactions,executed or lapsed.During such course,a lot of proper due diligence and legal documentation is needed.From the interviews,Hong Kong is said to be the destination of

106、choice for such M&A activities due to the excellent support of legal services throughout the entire process.According to the Global&Regional League Tables 2021(by deal count),the top 10 legal and financialadvisory firms that advised the highest number of M&A deals all have a presence in Hong Kong.13

107、 Given the transparent legal and regulatory framework of Hong Kong,clients can get reasonable support of legal advisory services.In this context,it is viable for deals from all over the world to be completed in Hong Kong,in view of its open,fair and transparent characteristics for all participants,w

108、hether from Mainland China or the rest of the world.10 McKinsey&Company,Global M&A market slows in 2022 first half,30 Septembe,2022,https:/ PwC,China M&A 2022 mid-year review and outlook,August 2022,https:/ 12 IFLR,2019 M&A Report:9Hong Kong,February 2019,https:/ Mergermarket,Global&Regional M&A Rep

109、ort 2021,January 2022,http:/ 13 Mergermarket,Global&Regional M&A Report 2021,January 2022,http:/ Jan2022 Jul2022 Jul2022 Oct2022 SepETF inclusion in Stock ConnectAnnouncement on the launch of Swap Connect in 2023The joint promulgation of the“18 measures for Supporting the Linked Development of Shenz

110、hen and Hong Kong Venture Capital Investments in Qianhai”by the Hong Kong Government and the Qianhai Authority of ShenzhenAnnouncement on the inclusion of foreign companies in southbound trading of Stock Connect8Consultation paper on the new listing rules for specialist technology companies9YearConn

111、ectivity initiatives in the financial marketHKEXs enhanced measures to facilitate“China Concept Stocks”in conducting secondary listing or obtaining primary listing7:Secondary listing-relaxing the requirements of secondary listing for Greater China issuers without a WVR structure;Secondary listing to

112、 primary listing secondary listed issuers will be considered as primary listed issuers in the case of delisting from an overseas exchange.A 12-month grace period will be granted for companies to prepare financialstatements;and Dual primary listing-Grandfathered Greater China issuers with WVR or vari

113、able interest entity(VIE)structures that fulfil secondary listing requirements could apply directly for dual primary listingi.ii.iii.Laws,Regulations and Financial Services in Hong Kong11127 HKSAR,Press Releases Attracting China Concept Stock companies to list in Hong Kong,6 April 2022,https:/www.in

114、fo.gov.hk/gia/general/202204/06/P2022040600276.htm?fontSize=1 8 SFC,SFC welcomes Central Governments support to enhance Hong Kongs IFC status,Sep 2022,https:/apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/doc?refNo=22PR67 9 HKEX,Exchange Publishes Consultation Paper on New Listi

115、ng Rules for Specialist Technology Companies,19 October 2022,https:/.hk/News/Regulatory-Announcements/2022/2210191news?sc_lang=enThe mergers and acquisitions marketAmong a broad-spectrum of deal-making activities,mergers&acquisitions(M&A)is attractive to most of the financial and professional servic

116、es firms.M&As are,in a nutshell,transactions in which two companies consolidate or combine through various forms,such as stock purchase and asset purchase.Consistent with the global trend10,the M&A market in Mainland China and Hong Kong recorded an increase in 2021 but a slight slowdown in 1H 2022-T

117、he M&A deal value in China,including Mainland China and Hong Kongs outbound transactions,fell from US$295.6 billion in 1H 2021 to US$236.7 billion in 1H 2022,representing a 20%decrease.The slower pace in global M&A activities earlier was due in part to the uncertainties brought by,for instance,the p

118、andemic,geopolitical instability,etc.11 Besides dealing with inbound and outbound M&A activities,there are opportunities for both private and public M&As in Hong Kong.Transactions relating to technology-related assets were common targets in the recent couple of years,while other active sectors also

119、include financial services,infrastructure and logistics,as well as media12Robust legal and financial advisory support throughout the entire M&A process in Hong KongLegal and financial advisory service supportIn the M&A universe,the reputation of service providers is important and such is often devel

120、oped through involvement in previous transactions,executed or lapsed.During such course,a lot of proper due diligence and legal documentation is needed.From the interviews,Hong Kong is said to be the destination of choice for such M&A activities due to the excellent support of legal services through

121、out the entire process.According to the Global&Regional League Tables 2021(by deal count),the top 10 legal and financialadvisory firms that advised the highest number of M&A deals all have a presence in Hong Kong.13 Given the transparent legal and regulatory framework of Hong Kong,clients can get re

122、asonable support of legal advisory services.In this context,it is viable for deals from all over the world to be completed in Hong Kong,in view of its open,fair and transparent characteristics for all participants,whether from Mainland China or the rest of the world.10 McKinsey&Company,Global M&A ma

123、rket slows in 2022 first half,30 Septembe,2022,https:/ 11 PwC,China M&A 2022 mid-year review and outlook,August 2022,https:/ 12 IFLR,2019 M&A Report:9Hong Kong,February 2019,https:/ Mergermarket,Global&Regional M&A Report 2021,January 2022,http:/ 13 Mergermarket,Global&Regional M&A Report 2021,Janua

124、ry 2022,http:/ Jan2022 Jul2022 Jul2022 Oct2022 SepETF inclusion in Stock ConnectAnnouncement on the launch of Swap Connect in 2023The joint promulgation of the“18 measures for Supporting the Linked Development of Shenzhen and Hong Kong Venture Capital Investments in Qianhai”by the Hong Kong Governme

125、nt and the Qianhai Authority of ShenzhenAnnouncement on the inclusion of foreign companies in southbound trading of Stock Connect8Consultation paper on the new listing rules for specialist technology companies9YearConnectivity initiatives in the financial marketHKEXs enhanced measures to facilitate“

126、China Concept Stocks”in conducting secondary listing or obtaining primary listing7:Secondary listing-relaxing the requirements of secondary listing for Greater China issuers without a WVR structure;Secondary listing to primary listing secondary listed issuers will be considered as primary listed iss

127、uers in the case of delisting from an overseas exchange.A 12-month grace period will be granted for companies to prepare financialstatements;and Dual primary listing-Grandfathered Greater China issuers with WVR or variable interest entity(VIE)structures that fulfil secondary listing requirements cou

128、ld apply directly for dual primary listingi.ii.iii.Laws,Regulations and Financial Services in Hong Kong1314ExamplesLegal SupportFair fight between the bidderand the targetRule 6(Equality of information to competing offerors)of the Codes on Takeovers and Mergers and Share Buy-backs states that any in

129、formation given to an offeror must be provided equally and promptly to another competing offeror.Regulations for six forms of market misconductThe SFO regulates insider dealing,false trading,price rigging,bited transactions,disclosure of false or misleading transaction,stock market manipulation.“Hon

130、g Kong is designed to be a global deal-making centre,there are no restrictions on capital movements in or out of the territory.This eases transactions and creates a favourable environment for the financing of deals.”Mr Barry Chan Managing Director,Head of Investment Banking,Hong Kong,China Internati

131、onal Capital Corporation“Regulations on the acquisition of public companies and cross-border M&A deals are neatly laid out and enforced.These clear instructions enable us,as bankers,to complete the deal more smoothly.”Dr Levin Wang Chief Executive Officer,Huatai Financial Holdings(Hong Kong)Ltd.Regu

132、lationsThe acquisition of public companies incorporated in Hong Kong is regulated by the Companies Ordinance(Cap.622),the Securities and Futures Ordinance(Cap.571)(SFO),the Listing Rules,if applicable,and the Takeovers Code.These regulations are set out and enforced.Further,the Companies Ordinance(C

133、ap.622)allows certain mergers between wholly-owned companies within the same group.Flexibility is offered in terms of alternative means of acquisition available in Hong Kong.In respect of public companies,one could consider takeovers and reverse takeovers as the alternatives.If a takeover is not con

134、tested,there are various alternative approaches available.For instance,the bidder may consider using a court-sanctioned scheme of arrangement.The advantage of this approach is that it is capable of delivering to the bidder the whole,i.e.100%,of the shares in the target while only requiring approval

135、at a shareholder meeting by 75%of the votes attaching to shares held by the disinterested shareholders.That said,this approach is only available for cases where no more than 10%of the votes attached to shares owned by disinterested shareholders vote against the proposal.Alternatively,as entitled by

136、the Companies Ordinance(Cap.622),the bidder can also exercise its compulsory acquisition rights to acquire the remaining shares if the bidder has received acceptances in respect of 90%or more of the shares tendered to the offer.The flexibility,in terms of deal structure,for example,and transparency

137、and certainty that Hong Kong offers make it a great place to conduct M&A in the city.Hong Kong has a remarkable legal support throughout the entire M&A process(non-exhaustive list):Laws,Regulations and Financial Services in Hong Kong1314ExamplesLegal SupportFair fight between the bidderand the targe

138、tRule 6(Equality of information to competing offerors)of the Codes on Takeovers and Mergers and Share Buy-backs states that any information given to an offeror must be provided equally and promptly to another competing offeror.Regulations for six forms of market misconductThe SFO regulates insider d

139、ealing,false trading,price rigging,bited transactions,disclosure of false or misleading transaction,stock market manipulation.“Hong Kong is designed to be a global deal-making centre,there are no restrictions on capital movements in or out of the territory.This eases transactions and creates a favou

140、rable environment for the financing of deals.”Mr Barry Chan Managing Director,Head of Investment Banking,Hong Kong,China International Capital Corporation“Regulations on the acquisition of public companies and cross-border M&A deals are neatly laid out and enforced.These clear instructions enable us

141、,as bankers,to complete the deal more smoothly.”Dr Levin Wang Chief Executive Officer,Huatai Financial Holdings(Hong Kong)Ltd.RegulationsThe acquisition of public companies incorporated in Hong Kong is regulated by the Companies Ordinance(Cap.622),the Securities and Futures Ordinance(Cap.571)(SFO),t

142、he Listing Rules,if applicable,and the Takeovers Code.These regulations are set out and enforced.Further,the Companies Ordinance(Cap.622)allows certain mergers between wholly-owned companies within the same group.Flexibility is offered in terms of alternative means of acquisition available in Hong K

143、ong.In respect of public companies,one could consider takeovers and reverse takeovers as the alternatives.If a takeover is not contested,there are various alternative approaches available.For instance,the bidder may consider using a court-sanctioned scheme of arrangement.The advantage of this approa

144、ch is that it is capable of delivering to the bidder the whole,i.e.100%,of the shares in the target while only requiring approval at a shareholder meeting by 75%of the votes attaching to shares held by the disinterested shareholders.That said,this approach is only available for cases where no more t

145、han 10%of the votes attached to shares owned by disinterested shareholders vote against the proposal.Alternatively,as entitled by the Companies Ordinance(Cap.622),the bidder can also exercise its compulsory acquisition rights to acquire the remaining shares if the bidder has received acceptances in

146、respect of 90%or more of the shares tendered to the offer.The flexibility,in terms of deal structure,for example,and transparency and certainty that Hong Kong offers make it a great place to conduct M&A in the city.Hong Kong has a remarkable legal support throughout the entire M&A process(non-exhaus

147、tive list):Laws,Regulations and Financial Services in Hong Kong1516Module 2-Dispute Resolution&Court SystemHong Kongs judicial and legal systems are robust and trusted.The city has been and will continue to be a pre-eminent centre for international legal and dispute resolution services,carrying out

148、functions in relation to mediation and arbitration.Among others,Hong Kong was ranked as the third most preferred seat of arbitration in the world by the Queen Mary University of London and White&Case International Arbitration Survey in 2021,showing international businesses vote of confidence in the

149、systems 14Alternative dispute resolutionAlternative dispute resolution(ADR)refers to a dispute resolution process aside from litigation.It is becoming more popular nowadays due to its cost-effective and confidential nature which could avoid the trade terms to be disclosed.Two commonly used forms of

150、ADR are arbitration and mediation.ArbitrationArbitration is a dispute resolution process governed by the Arbitration Ordinance(Cap.609).When the arbitrator has a finaldecision on the case,an award will be issued to the aggrieved party.Arbitral awards made in Hong Kong can also be enforced through th

151、e courts of most trading countries in the world.Pursuant to the statistics released by the Hong Kong International Arbitration Centre(HKIAC)15,it handled 344 arbitration cases with a total amount in dispute of HK$43.1 billion in 2022.Among which,83.1%were cross-border cases,where at least one party

152、was outside Hong Kong(Figure 1).Altogether,63 jurisdictions,for instance Mainland China,British Virgin Islands,Cayman Islands and Singapore,were involved.14 Queen Mary University of London and White&Case,2021 International Arbitration Survey:Adapting arbitration to a changing world,May 2021,https:/

153、15 HKIAC,2022 Statistics,https:/www.hkiac.org/about-us/statistics MediationSince the Civil Justice Reform in April 2009,mediation serves as a voluntary and confidentialdispute resolution process to encourage settlement before trial.A mediator assists the disputing parties by various means-identifyin

154、g the issues in dispute,exploring options of solutions,facilitating communication and reaching a settlement agreement regarding the resolution of the whole,or part,of the dispute.In 2021,396 mediation cases were submitted to the Court of First Instance,with 42%(168 cases)resulting in agreements16;me

155、anwhile,602 mediation cases were submitted to the District Court,with 53%(321 cases)resulting in agreements(Figure 2).17Figure 2:Mediation cases in the Court of First Instance and the District Court(2021)16 Hong Kong Judiciary,Summary of Mediation Reports filed in the Court of First Instance in 2021

156、,https:/mediation.judiciary.hk/en/doc/2021_CFI_EN.pdf 17 Hong Kong Judiciary,Summary of Mediation Reports filed in the District Court in 2021,https:/mediation.judiciary.hk/en/doc/2021_DC_EN.pdfSource:HKIAC58 cases,17%286 cases,83%Figure 1:Nature of cases handled by HKIAC in 2022Local casesCross-bord

157、er casesSource:Hong Kong Judiciary Mediation cases in the Court of First InstanceMediation cases in the District CourtFull agreement 164 cases,41%No agreement 228 cases,58%Partial agreement 4 cases,1%Full agreement 313 cases,52%No agreement 281 cases,47%Partial agreement 8 cases,1%Laws,Regulations a

158、nd Financial Services in Hong KongTotal number of cases:396Total number of cases:602Total number of cases:3441516Module 2-Dispute Resolution&Court SystemHong Kongs judicial and legal systems are robust and trusted.The city has been and will continue to be a pre-eminent centre for international legal

159、 and dispute resolution services,carrying out functions in relation to mediation and arbitration.Among others,Hong Kong was ranked as the third most preferred seat of arbitration in the world by the Queen Mary University of London and White&Case International Arbitration Survey in 2021,showing inter

160、national businesses vote of confidence in the systems 14Alternative dispute resolutionAlternative dispute resolution(ADR)refers to a dispute resolution process aside from litigation.It is becoming more popular nowadays due to its cost-effective and confidential nature which could avoid the trade ter

161、ms to be disclosed.Two commonly used forms of ADR are arbitration and mediation.ArbitrationArbitration is a dispute resolution process governed by the Arbitration Ordinance(Cap.609).When the arbitrator has a finaldecision on the case,an award will be issued to the aggrieved party.Arbitral awards mad

162、e in Hong Kong can also be enforced through the courts of most trading countries in the world.Pursuant to the statistics released by the Hong Kong International Arbitration Centre(HKIAC)15,it handled 344 arbitration cases with a total amount in dispute of HK$43.1 billion in 2022.Among which,83.1%wer

163、e cross-border cases,where at least one party was outside Hong Kong(Figure 1).Altogether,63 jurisdictions,for instance Mainland China,British VirginIslands,Cayman Islands and Singapore,were involved.14 Queen Mary University of London and White&Case,2021 International Arbitration Survey:Adapting arbi

164、tration to a changing world,May 2021,https:/ 15 HKIAC,2022 Statistics,https:/www.hkiac.org/about-us/statistics MediationSince the Civil Justice Reform in April 2009,mediation serves as a voluntary and confidentialdispute resolution process to encourage settlement before trial.A mediator assists the

165、disputing parties by various means-identifying the issues in dispute,exploring options of solutions,facilitating communication and reaching a settlement agreement regarding the resolution of the whole,or part,of the dispute.In 2021,396 mediation cases were submitted to the Court of First Instance,wi

166、th 42%(168 cases)resulting in agreements16;meanwhile,602 mediation cases were submitted to the District Court,with 53%(321 cases)resulting in agreements(Figure 2).17 Figure 2:Mediation cases in the Court of First Instance and the District Court(2021)16 Hong Kong Judiciary,Summary of Mediation Report

167、s filed in the Court of First Instance in 2021,https:/mediation.judiciary.hk/en/doc/2021_CFI_EN.pdf 17 Hong Kong Judiciary,Summary of Mediation Reports filed in the District Court in 2021,https:/mediation.judiciary.hk/en/doc/2021_DC_EN.pdfSource:HKIAC58 cases,17%286 cases,83%Figure 1:Nature of cases

168、 handled by HKIAC in 2022Local casesCross-border casesSource:Hong Kong Judiciary Mediation cases in the Court of First InstanceMediation cases in the District CourtFull agreement 164 cases,41%No agreement 228 cases,58%Partial agreement 4 cases,1%Full agreement 313 cases,52%No agreement 281 cases,47%

169、Partial agreement 8 cases,1%Laws,Regulations and Financial Services in Hong KongTotal number of cases:396Total number of cases:602Total number of cases:3441718The Basic LawThe Basic Law,enacted by the National Peoples Congress in accordance with Article 31 of the Constitution of the Peoples Republic

170、 of China,gives legal effect to the implementation of“One Country,Two Systems”.Therefore,while Hong Kong is a part of China,under the principle of“One Country,Two Systems”,it has retained its common law system,which has been in practice in Hong Kong for more than 170 years.The Basic Law protects oth

171、er fundamental rights as well.For instance,equality before the law,the power of independent judiciary and final adjudication by the Court of Final Appeal are guaranteed.Hong Kongs judicial independenceThe Basic Law,which specifically enshrines Hong Kongs judicial independence,provides that the court

172、s of Hong Kong must exercise the judicial power independently,free from any interference.Additionally,Hong Kong courts can reference the precedents of other common law jurisdictions to ensure cases are adjudicated in a fair,reasonable and predictable manner.The quality of Hong Kongs judges is top cl

173、assHong Kongs judiciary system has always been independent,and it helps uphold the rule of law.All judges and magistrates must be qualified to practice law either in Hong Kong orin another common law jurisdiction,and are required to have extensive professional experience in a relevant field.Under th

174、e Basic Law,judges are appointed by the Chief Executive of the HKSAR on the recommendation of the Judicial Officers Recommendation Commission.18 Furthermore,Hong Kongs Court of Final Appeal includes local eminent judges and non-permanent judges from other common law jurisdictions.These judges are re

175、cognised to be some of the best and most respected judges in the common law world,such as Australia,Canada and the UK.The acceptance of appointments to the Court of Final Appeal is a consistent demonstration of their confidence in Hong Kongs judicial independence and its quality as a dispute resolut

176、ion centre.“What underpins dispute resolution in the Hong Kong court is a very basic principle.That principle is justice must be done but it must also be seen to be done.That principle encapsulates two things.First,there has to be great fairness in the way the courts treat people.The second thing is

177、 that the courts have to be completely open in the way it deals with people.”Dr Anthony NeohKC,SC,JP,Chair,Asian Academy of International Law“Hong Kong has one of the best regarded judiciaries in the world.Judicial independence is very much in our DNA.In practice,it is done every day in every case i

178、n every court.”18 Community Legal Information Centre,How are the Judges being appointed or dismissed?,February,2020,https:/www.clic.org.hk/en/topics/hkLegalSystem/courtsStructureAndTheJudiciary/answer11 Laws,Regulations and Financial Services in Hong KongMr Laurence Li SC,JP,Chairman,Financial Servi

179、ces Development Council1718The Basic LawThe Basic Law,enacted by the National Peoples Congress in accordance with Article 31 of the Constitution of the Peoples Republic of China,gives legal effect to the implementation of“One Country,Two Systems”.Therefore,while Hong Kong is a part of China,under th

180、e principle of“One Country,Two Systems”,it has retained its common law system,which has been in practice in Hong Kong for more than 170 years.The Basic Law protects other fundamental rights as well.For instance,equality before the law,the power of independent judiciary and final adjudication by the

181、Court of Final Appeal are guaranteed.Hong Kongs judicial independenceThe Basic Law,which specifically enshrines Hong Kongs judicial independence,provides that the courts of Hong Kong must exercise the judicial power independently,free from any interference.Additionally,Hong Kong courts can reference

182、 the precedents of other common law jurisdictions to ensure cases are adjudicated in a fair,reasonable and predictable manner.The quality of Hong Kongs judges is top classHong Kongs judiciary system has always been independent,and it helps uphold the rule of law.All judges and magistrates must be qu

183、alified to practice law either in Hong Kong orin another common law jurisdiction,and are required to have extensive professional experience in a relevant field.Under the Basic Law,judges are appointed by the Chief Executive of the HKSAR on the recommendation of the Judicial Officers Recommendation C

184、ommission.18Furthermore,Hong Kongs Court of Final Appeal includes local eminent judges and non-permanent judges from other common law jurisdictions.These judges are recognised to be some of the best and most respected judges in the common law world,such as Australia,Canada and the UK.The acceptance

185、of appointments to the Court of Final Appeal is a consistent demonstration of their confidence in Hong Kongs judicial independence and its quality as a dispute resolution centre.“What underpins dispute resolution in the Hong Kong court is a very basic principle.That principle is justice must be done

186、 but it must also be seen to be done.That principle encapsulates two things.First,there has to be great fairness in the way the courts treat people.The second thing is that the courts have to be completely open in the way it deals with people.”Dr Anthony NeohKC,SC,JP,Chair,Asian Academy of Internati

187、onal Law“Hong Kong has one of the best regarded judiciaries in the world.Judicial independence is very much in our DNA.In practice,it is done every day in every case in every court.”18 Community Legal Information Centre,How are the Judges being appointed or dismissed?,February,2020,https:/www.clic.o

188、rg.hk/en/topics/hkLegalSystem/courtsStructureAndTheJudiciary/answer11 Laws,Regulations and Financial Services in Hong KongMr Laurence Li SC,JP,Chairman,Financial Services Development Council192019 Department of Justice,The Judge Over Your Shoulder A Guide To Judicial Review For Administrators(4th Ed

189、ition),May 2022,https:/www.doj.gov.hk/en/publications/pdf/JOYS_4th_e.pdf 20 Department of Justice,The Judge Over Your Shoulder A Guide To Judicial Review For Administrators(4th Edition),May 2022,https:/www.doj.gov.hk/en/publications/pdf/JOYS_4th_e.pdf21 WEF,The Global Competitiveness Report 2019,Oct

190、ober 2019,https:/www3.weforum.org/docs/WEF_TheGlobalCompetitivenessReport2019.pdf 22Transparency International,Corruption Perceptions Index 2021,January 2022,https:/www.transparency.org/en/countries/hong-kongFurthermore,public officials who act in a corrupt manner are also subject to investigation.I

191、n this regard,Hong Kong has a longstanding record of zero tolerance for corruption,which contributes to its notably transparent legal and financial system.Hong Kong ranks highly for low corruption in global indices.21,22Its anti-corruption laws,including the Prevention of Bribery Ordinance(Cap.201),

192、the Elections(Corrupt and Illegal Conduct)Ordinance(Cap.554)and common law anti-bribery and misconduct in public office offences are particularly stringent.Laws,Regulations and Financial Services in Hong Kong*The percentage of cases with favourable outcome to the Government in 2021 has not been rele

193、ased.Source:Department of Justice,LegCoHong Kong courts remain impartial in cases involving the Government or public bodiesJudicial review could be brought against government officials or other public officers if they exercise their powers in a potentially illegal or irrational manner,or taken witho

194、ut following proper procedures.Such a remedy could ensure the public bodies act lawfully and do not abuse their power.In Hong Kong,in order to apply for a judicial review,the decision concerned must affect the public interest.The court will then review the relevant decision-making process instead of

195、 the merits of the decision.There were 1,767 applications for leave for judicial review in 2021 and 2,500 applications in 2020.19 Among cases involving the Government in 2020,86%of the outcome of judicial review was favourable to the Government,reflecting that the Government has been committed to th

196、e observance of the public law principles when exercising its power(Figure 3);on the other hand,it implies that it is not uncommon for the Hong Kong Government and other public bodies to lose cases before Hong Kong courts via judicial review and other litigation tactics.20Figure 3:Statistics of judi

197、cial review(2015-2021)2015201620172018201920202021Total no.of applicationsOutcome favourable to the Government in respect of cases involving Government56%88%85%93%95%86%2592281,1463,0143,8892,5001,767192019 Department of Justice,The Judge Over Your Shoulder A Guide To Judicial Review For Administrat

198、ors(4th Edition),May 2022,https:/www.doj.gov.hk/en/publications/pdf/JOYS_4th_e.pdf 20 Department of Justice,The Judge Over Your Shoulder A Guide To Judicial Review For Administrators(4th Edition),May 2022,https:/www.doj.gov.hk/en/publications/pdf/JOYS_4th_e.pdf21 WEF,The Global Competitiveness Repor

199、t 2019,October 2019,https:/www3.weforum.org/docs/WEF_TheGlobalCompetitivenessReport2019.pdf 22 Transparency International,Corruption Perceptions Index 2021,January 2022,https:/www.transparency.org/en/countries/hong-kongFurthermore,public officials who act in a corrupt manner are also subject to inve

200、stigation.In this regard,Hong Kong has a longstanding record of zero tolerance for corruption,which contributes to its notably transparent legal and financial system.Hong Kong ranks highly for low corruption in global indices.21,22 Its anti-corruption laws,including the Prevention of Bribery Ordinan

201、ce(Cap.201),the Elections(Corrupt and Illegal Conduct)Ordinance(Cap.554)and common law anti-bribery and misconduct in public office offences are particularly stringent.Laws,Regulations and Financial Services in Hong Kong*The percentage of cases with favourable outcome to the Government in 2021 has n

202、ot been released.Source:Department of Justice,LegCoHong Kong courts remain impartial in cases involving the Government or public bodiesJudicial review could be brought against government officials or other public officers if they exercise their powers in a potentially illegal or irrational manner,or

203、 taken without following proper procedures.Such a remedy could ensure the public bodies act lawfully and do not abuse their power.In Hong Kong,in order to apply for a judicial review,the decision concerned must affect the public interest.The court will then review the relevant decision-making proces

204、s instead of the merits of the decision.There were 1,767 applications for leave for judicial review in 2021 and 2,500 applications in 2020.19Among cases involving the Government in 2020,86%of the outcome of judicial review was favourable to the Government,reflecting that the Government has been comm

205、itted to the observance of the public law principles when exercising its power(Figure 3);on the other hand,it implies that it is not uncommon for the Hong Kong Government and other public bodies to lose cases before Hong Kong courts via judicial review and other litigation tactics.20Figure 3:Statist

206、ics of judicial review(2015-2021)2015201620172018201920202021Total no.of applicationsOutcome favourable to the Government in respect of cases involving Government56%88%85%93%95%86%2592281,1463,0143,8892,5001,767212223 WTO,Hong Kong,China and the WTO,accessed on 14 Oct 2022,https:/www.wto.org/english

207、/thewto_e/countries_e/hong_kong_china_e.htm 24 Legislative Council,Brief International Organisations(Privileges and Immunities)(World Intellectual Property Organisation)Order,2022,https:/www.legco.gov.hk/yr2022/english/brief/citbcr2201115_20220518-e.pdf 25 IMD World Competitiveness Center,IMD World

208、Competitiveness Yearbook 2022,Digital 2021,Talent 2021:summaries,2022,https:/www.imd.org/globalassets/wcc/docs/wco/pdfs/countries-landing-page/HK.pdfEnforceable private and public rightsHong Kong is one of the most protected legal jurisdictions in the world.Under the Basic Law and the Hong Kong Bill

209、 of Rights Ordinance(Cap.383),private and public rights are well protected in Hong Kong.It is also protected by hundreds of international treaties and conventions,such as the International Covenant on Civil and Political Rights.In terms of economic relations,for instance,Hong Kong is a member of the

210、 World Trade Organization since its inception in 199523 and the city“takes part in the Assemblies of the Member States of the World Intellectual Property Organization as part of the Chinese delegation”.24 Thus,Hong Kong is obliged to abide by various conventions in relation to trade,commerce,financi

211、a services,protection of intellectual property,patent rights,etc.In the World Competitiveness Yearbook 2022 published by the International Institute for Management Development,around 70%respondents of the Executive Opinion Survey ranked“Effective legal environment”as the most attractive factors of H

212、ong Kong.25Module 3 Legal ProfessionHong Kong is well supported by a diverse pool of quality and international legal practitioners in different areas of laws.This is an important cornerstone upon which Hong Kong maintains its robust and open legal framework.Businesses have access to top-notch legal

213、professionals who can provide them with local or cross-jurisdictional legal solutions.Attractiveness for legal professionalsThe wide spectrum of expertise the legal profession possesses covers many areas,ranging from capital markets,corporate finance,securities,banking,intellectual property,maritime

214、 law,etc.As of December 2022,Hong Kong had 13,144 solicitors and 1,610 barristers,1,442 registered foreign lawyers from different jurisdictions as well as 77 foreign law firms in Hong Kong,providing services in relation to cross-boundary and international legal issues.26,27 This legal brain bank mak

215、es Hong Kong a world-class legal centre in the region.28 Being a lawyer in Hong Kong,one can get to meet and work with peers of great diversity.In Hong Kong,IPO is a substantial revenue-generating practice for a considerable number of law firms in Hong Kong.It is,however,not the whole and entire bus

216、iness for the total of some 900 law firms operating here.Firms in Hong Kong provide a wide range of services,and many have been through the ups and downs of the global financial market.In addition to IPO activities,non-IPO deals,such as credit and secondary fund activities,acquisitions and disposals

217、,restructuring,technology and intellectual property rights,etc.are some other revenue-generating areas.The diversification is not limited to the area of expertise,but also covers the base of their clients the deals basically come from different parts of the world,may it be Mainland China,Southeast A

218、sia,Europe or the US.26 Hong Kong Bar Association,Bar List,December 2022,https:/www.hkba.org/Bar-List 27 The Law Society of Hong Kong,Profile of the Profession,December 2022,https:/www.hklawsoc.org.hk/en/About-the-Society/Profile-of-the-Professio28 Hong Kong Legal Hub,Our Talented Professionals,http

219、s:/www.legalhub.gov.hk/details.php?a=3&v#“People who choose to do business in Hong Kong will see substantially the same private and public rights that they would see in any other common law jurisdiction.”Mr Frederick Hui Partner,Solicitor Advocate,Zhong Lun Law Firm LLPLaws,Regulations and Financial

220、 Services in Hong Kong212223 WTO,Hong Kong,China and the WTO,accessed on 14 Oct 2022,https:/www.wto.org/english/thewto_e/countries_e/hong_kong_china_e.htm24 Legislative Council,Brief International Organisations(Privileges and Immunities)(World Intellectual Property Organisation)Order,2022,https:/www

221、.legco.gov.hk/yr2022/english/brief/citbcr2201115_20220518-e.pdf 25 IMD World Competitiveness Center,IMD World Competitiveness Yearbook 2022,Digital 2021,Talent 2021:summaries,2022,https:/www.imd.org/globalassets/wcc/docs/wco/pdfs/countries-landing-page/HK.pdfEnforceable private and public rightsHong

222、 Kong is one of the most protected legal jurisdictions in the world.Under the Basic Law and the Hong Kong Bill of Rights Ordinance(Cap.383),private and public rights are well protected in Hong Kong.It is also protected by hundreds of international treaties and conventions,such as the International C

223、ovenant on Civil and Political Rights.In terms of economic relations,for instance,Hong Kong is a member of the World Trade Organization since its inception in 199523and the city“takes part in the Assemblies of the Member States of the World Intellectual Property Organization as part of the Chinese d

224、elegation”.24 Thus,Hong Kong is obliged to abide by various conventions in relation to trade,commerce,financia services,protection of intellectual property,patent rights,etc.In the World Competitiveness Yearbook 2022 published by the International Institute for Management Development,around 70%respo

225、ndents of the Executive Opinion Survey ranked“Effective legal environment”as the most attractive factors of Hong Kong.25Module 3 Legal ProfessionHong Kong is well supported by a diverse pool of quality and international legal practitioners in different areas of laws.This is an important cornerstone

226、upon which Hong Kong maintains its robust and open legal framework.Businesses have access to top-notch legal professionals who can provide them with local or cross-jurisdictional legal solutions.Attractiveness for legal professionalsThe wide spectrum of expertise the legal profession possesses cover

227、s many areas,ranging from capital markets,corporate finance,securities,banking,intellectual property,maritime law,etc.As of December 2022,Hong Kong had 13,144 solicitors and 1,610 barristers,1,442 registered foreign lawyers from different jurisdictions as well as 77 foreign law firms in Hong Kong,pr

228、oviding services in relation to cross-boundary and international legal issues.26,27 This legal brain bank makes Hong Kong a world-class legal centre in the region.28 Being a lawyer in Hong Kong,one can get to meet and work with peers of great diversity.In Hong Kong,IPO is a substantial revenue-gener

229、ating practice for a considerable number of law firms in Hong Kong.It is,however,not the whole and entire business for the total of some 900 law firms operating here.Firms in Hong Kong provide a wide range of services,and many have been through the ups and downs of the global financial market.In add

230、ition to IPO activities,non-IPO deals,such as credit and secondary fund activities,acquisitions and disposals,restructuring,technology and intellectual property rights,etc.are some other revenue-generating areas.The diversification is not limited to the area of expertise,but also covers the base of

231、their clients the deals basically come from different parts of the world,may it be Mainland China,Southeast Asia,Europe or the US.26 Hong Kong Bar Association,Bar List,December 2022,https:/www.hkba.org/Bar-List 27 The Law Society of Hong Kong,Profile of the Profession,December 2022,https:/www.hklaws

232、oc.org.hk/en/About-the-Society/Profile-of-the-Professio28 Hong Kong Legal Hub,Our Talented Professionals,https:/www.legalhub.gov.hk/details.php?a=3&v#“People who choose to do business in Hong Kong will see substantially the same private and public rights that they would see in any other common law j

233、urisdiction.”Mr Frederick Hui Partner,Solicitor Advocate,Zhong Lun Law Firm LLPLaws,Regulations and Financial Services in Hong Kong2324“I chose Hong Kong because I would have the privilege of serving my country.”Dr Anthony NeohKC,SC,JP,Chair,Asian Academy of International Law“I found myself having c

234、onfidence in the prospects brought by the fast-growing economy in Hong Kong,well supported by our robust legal system and the competence of legal profession in the city.”Mr Chak-ming Chan President,The Law Society of Hong Kong29 Community Legal Information Centre,What are the main differences betwee

235、n Solicitors and Barristers?,February 2020,https:/www.clic.org.hk/en/topics/hkLegalSystem/theLegalProfession/answer17 30 The Law Society of Hong Kong,Annual Report 2021,2021,https:/www.hklawsoc.org.hk/-/media/HKLS/pub_e/about/report/AR_2021/Annual-Report-2021.pdf?rev=7efd2e622c024d75844897bc43c19f44

236、 Solicitors and barristers Hong Kongs legal profession,in general,is divided into solicitors and barristers with a clear demarcated scope of practice.In general,barristers are not allowed to practise as solicitors simultaneously,vice versa.Solicitors have direct contact with clients and play a major

237、 role in offering customer care.Many solicitors work on non-contentious transactional matters and handle documentation files such as the drafting of contracts.They have a limitation on the rights of audience before the courts;whereas barristers specialise in advocacy,providing expertise in trial wor

238、k and giving oral submission in the court on behalf of their clients.They have unlimited rights of audience in all courts.Similar to solicitors,barristers can also draft legal documents or give legal advice to their clients.29An alternative career for legal professionals In view of more complex and

239、stringent global regulations,corporations have been aware of the importance of having an internal legal team to provide timely legal advice to their daily operation.In-house legal team is expected to not only manage and resolve crises,but to anticipate and detect risks.For in-house counsel,sharp bus

240、iness acumen and the ability to review documents from all angles and spot legal and non-legal red flags are crucial skills.Their contribution should not be undermined as they serve true to the smooth running of Hong Kong as an international financial centre.They rapport with private practice legal p

241、ractitioners and position themselves as an effective communication bridge with business people in their organisations.Meanwhile,being an in-house counsel is a highly attractive option for some lawyers,with the perception being that it can offer a better flexibility and the opportunity to become a ke

242、y stakeholder and business partner.According to the Law Society of Hong Kong,around 30%practicing solicitors are in-house lawyers as at the end of 2021.30There is also a new breed of in-house counsel working on short-term contracts.The example of in-house lawyers demonstrates the variety,flexibility

243、 and mobility of Hong Kongs strong and healthy legal industry.And in every category,the Hong Kong legal profession is flushed with talents.Laws,Regulations and Financial Services in Hong Kong2324“I chose Hong Kong because I would have the privilege of serving my country.”Dr Anthony NeohKC,SC,JP,Chai

244、r,Asian Academy of International Law“I found myself having confidence in the prospects brought by the fast-growing economy in Hong Kong,well supported by our robust legal system and the competence of legal profession in the city.”Mr Chak-ming Chan President,The Law Society of Hong Kong29 Community L

245、egal Information Centre,What are the main differences between Solicitors and Barristers?,February 2020,https:/www.clic.org.hk/en/topics/hkLegalSystem/theLegalProfession/answer17 30 The Law Society of Hong Kong,Annual Report 2021,2021,https:/www.hklawsoc.org.hk/-/media/HKLS/pub_e/about/report/AR_2021

246、/Annual-Report-2021.pdf?rev=7efd2e622c024d75844897bc43c19f44 Solicitors and barristers Hong Kongs legal profession,in general,is divided into solicitors and barristers with a clear demarcated scope of practice.In general,barristers are not allowed to practise as solicitors simultaneously,vice versa.

247、Solicitors have direct contact with clients and play a major role in offering customer care.Many solicitors work on non-contentious transactional matters and handle documentation files such as the drafting of contracts.They have a limitation on the rights of audience before the courts;whereas barris

248、ters specialise in advocacy,providing expertise in trial work and giving oral submission in the court on behalf of their clients.They have unlimited rights of audience in all courts.Similar to solicitors,barristers can also draft legal documents or give legal advice to their clients.29An alternative

249、 career for legal professionals In view of more complex and stringent global regulations,corporations have been aware of the importance of having an internal legal team to provide timely legal advice to their daily operation.In-house legal team is expected to not only manage and resolve crises,but t

250、o anticipate and detect risks.For in-house counsel,sharp business acumen and the ability to review documents from all angles and spot legal and non-legal red flags are crucial skills.Their contribution should not be undermined as they serve true to the smooth running of Hong Kong as an international

251、 financial centre.They rapport with private practice legal practitioners and position themselves as an effective communication bridge with business people in their organisations.Meanwhile,being an in-house counsel is a highly attractive option for some lawyers,with the perception being that it can o

252、ffer a better flexibility and the opportunity to become a key stakeholder and business partner.According to the Law Society of Hong Kong,around 30%practicing solicitors are in-house lawyers as at the end of 2021.30 There is also a new breed of in-house counsel working on short-term contracts.The exa

253、mple of in-house lawyers demonstrates the variety,flexibility and mobility of Hong Kongs strong and healthy legal industry.And in every category,the Hong Kong legal profession is flushed with talents.Laws,Regulations and Financial Services in Hong Kong2526 Opportunities brought by the integration wi

254、th the Greater Bay AreaThe opportunities for Hong Kongs legal profession have been further expanded in recent years,facilitated by national policies such as the 14th Five-Year Plan,Closer Economic Partnership Arrangement(CEPA)and the Greater Bay Area initiatives.Under CEPA,which was launched in 2003

255、 with multiple rounds of further liberalisation since then,Hong Kong firms are allowed to form associations with Mainland firms,and Mainland firms can employ Hong Kong legal practitioners as consultants.In 2021,a pilot scheme was launched,allowing Hong Kongs and Macaus experienced legal practitioner

256、s to practise on specified civil and commercial legal matters in the GBA upon passing the GBA Legal Professional Examination.It is an important breakthrough for the legal sector.655 Hong Kong lawyers(588 solicitors and 67 barristers)enrolled in the first inaugural GBA Legal Professional Examination

257、as of in 2021.31Moreover,Hong Kong enterprises registered in Qianhai may choose Hong Kong law as the applicable law of contracts.This would help drive the demand for legal services of Hong Kong.31 Legislative Council,Panel on Admnistration of Justice and Legal Services-Background brief on the Guangd

258、ong-Hong Kong-Macao Greater Bay Area (“GBA”)Legal Professional Examination and other development opportunities in GBA for the Hong Kong legal profession,August 2021,https:/www.legco.gov.hk/yr20-21/english/panels/ajls/papers/ajls20210831cb4-1430-5-e.pdf“Financial institutions have begun to realise th

259、e multi-layered expertise of the job in view of more complex and stringent global regulations,and in-house counsel has become one of the three mainstream legal professions as a result.”Mr Phillip Meyer Chief Compliance Officer&Co-Chief Operating Officer,Oasis Management Company Ltd.“Hong Kongs integ

260、ration with the Greater Bay Area means that there is scope for Hong Kong lawyers to expand beyond the city and to deepen our cooperation with Mainland China counterparts.”Ms Roanna Kwong Senior Associate,Allen&OveryLaws,Regulations and Financial Services in Hong Kong2526Opportunities brought by the

261、integration with the Greater Bay AreaThe opportunities for Hong Kongs legal profession have been further expanded in recent years,facilitated by national policies such as the 14th Five-Year Plan,Closer Economic Partnership Arrangement(CEPA)and the Greater Bay Area initiatives.Under CEPA,which was la

262、unched in 2003 with multiple rounds of further liberalisation since then,Hong Kong firms are allowed to form associations with Mainland firms,and Mainland firms can employ Hong Kong legal practitioners as consultants.In 2021,a pilot scheme was launched,allowing Hong Kongs and Macaus experienced lega

263、l practitioners to practise on specified civil and commercial legal matters in the GBA upon passing the GBA Legal Professional Examination.It is an important breakthrough for the legal sector.655 Hong Kong lawyers(588 solicitors and 67 barristers)enrolled in the first inaugural GBA Legal Professiona

264、l Examination as of in 2021.31Moreover,Hong Kong enterprises registered in Qianhai may choose Hong Kong law as the applicable law of contracts.This would help drive the demand for legal services of Hong Kong.31 Legislative Council,Panel on Admnistration of Justice and Legal Services-Background brief

265、 on the Guangdong-Hong Kong-Macao Greater Bay Area (“GBA”)Legal Professional Examination and other development opportunities in GBA for the Hong Kong legal profession,August 2021,https:/www.legco.gov.hk/yr20-21/english/panels/ajls/papers/ajls20210831cb4-1430-5-e.pdf“Financial institutions have begun

266、 to realise the multi-layered expertise of the job in view of more complex and stringent global regulations,and in-house counsel has become one of the three mainstream legal professions as a result.”Mr Phillip Meyer Chief Compliance Officer&Co-Chief Operating Officer,Oasis Management Company Ltd.“Ho

267、ng Kongs integration with the Greater Bay Area means that there is scope for Hong Kong lawyers to expand beyond the city and to deepen our cooperation with Mainland China counterparts.”Ms Roanna Kwong Senior Associate,Allen&OveryLaws,Regulations and Financial Services in Hong Kong2728Module 4 Regula

268、torsFinancial markets are global,fast-changing and highly complex nowadays.Hong Kong maintains a regulatory regime that is a mixture of principles-based and prescriptive regulations.Hong Kongs financial market has developed and evolved with the increasing depth and diversity of financial products an

269、d services,and adhere to international regulatory standards and developments.This consolidates Hong Kongs status as an international financial centre.A world-class financial centreWhile there is no overarching financial regulator in Hong Kong,the regulators,and the exchange that conducts front-line

270、regulation of listed issuers in the securities and derivatives market,are generally responsible for regulation of specific portions of the financial sector in the city to maintain its financial stability and integrity.They are the Hong Kong Monetary Authority(HKMA),the Securities and Futures Commiss

271、ion(SFC),the Insurance Authority(IA),the Mandatory Provident Fund Schemes Authority(MPFA),the Accounting and Financial Reporting Council(AFRC)and the Hong Kong Exchanges and Clearing Limited(HKEX).32 This clear division of responsibility allows financial institutions to have effective liaison with t

272、he appropriate entity when they plan to start and/or carry on a regulated business in Hong Kong.Please refer to Appendix 1 for further details on their functions.Hong Kong Monetary Authority:The HKMA is responsible for maintaining monetary and banking stability in Hong Kong.In conjunction with the S

273、FC,the HKMA also supervises securities activities undertaken by banks in Hong Kong.Securities and Futures Commission:The SFC is responsible for regulating the securities and futures markets in Hong Kong,including asset management,OTC derivatives and credit rating agencies.Insurance Authority:The IA

274、is responsible for regulating and promoting the development of insurance industry in Hong Kong.Mandatory Provident Fund Schemes Authority:The MPFA is responsible for regulating and supervising mandatory privately-managed provident fund schemes.It also acts as the Registrar of Occupational Retirement

275、 Schemes(ORSO schemes)responsible for regulating the operation of ORSO schemes.32 FSTB,Hong Kong:The Facts:Financial Services,https:/www.gov.hk/en/about/abouthk/factsheets/docs/financial_services.pdf Accounting and Financial Reporting Council:The AFRC regulates an independent regulatory regime of th

276、e accounting profession,enhanced to be in line with international developments with increased coherence and efficienc.33Hong Kong Exchanges and Clearing Limited:HKEX is the holding company of the Hong Kong Stock Exchange(SEHK)and the Hong Kong Futures Exchange(HKFE),which respectively operate the se

277、curities and futures markets in Hong Kong,including responsibility for regulating listing matters and ongoing corporate governance of listed companies.It is noteworthy that Hong Kongs financial regulators collaborate with each other,and they share the common responsibility of protecting the strength

278、,resilience and integrity of Hong Kongs marketplace.As financial institutions evolve and scale their business practices,products and services,functions of these regulators will remain as important as ever.33 FSTB,New Regulatory Regime of the Accounting Profession,2022,https:/www.fstb.gov.hk/en/finan

279、cial_ser/regulatory-reform-of-the-accountin profession.htm Laws,Regulations and Financial Services in Hong Kong2728Module 4 RegulatorsFinancial markets are global,fast-changing and highly complex nowadays.Hong Kong maintains a regulatory regime that is a mixture of principles-based and prescriptive

280、regulations.Hong Kongs financial market has developed and evolved with the increasing depth and diversity of financial products and services,and adhere to international regulatory standards and developments.This consolidates Hong Kongs status as an international financial centre.A world-class financ

281、ial centreWhile there is no overarching financial regulator in Hong Kong,the regulators,and the exchange that conducts front-line regulation of listed issuers in the securities and derivatives market,are generally responsible for regulation of specific portions of the financial sector in the city to

282、 maintain its financial stability and integrity.They are the Hong Kong Monetary Authority(HKMA),the Securities and Futures Commission(SFC),the Insurance Authority(IA),the Mandatory Provident Fund Schemes Authority(MPFA),the Accounting and Financial Reporting Council(AFRC)and the Hong Kong Exchanges

283、and Clearing Limited(HKEX).32This clear division of responsibility allows financial institutions to have effective liaison with the appropriate entity when they plan to start and/or carry on a regulated business in Hong Kong.Please refer to Appendix 1 for further details on their functions.Hong Kong

284、 Monetary Authority:The HKMA is responsible for maintaining monetary and banking stability in Hong Kong.In conjunction with the SFC,the HKMA also supervises securities activities undertaken by banks in Hong Kong.Securities and Futures Commission:The SFC is responsible for regulating the securities a

285、nd futures markets in Hong Kong,including asset management,OTC derivatives and credit rating agencies.Insurance Authority:The IA is responsible for regulating and promoting the development of insurance industry in Hong Kong.Mandatory Provident Fund Schemes Authority:The MPFA is responsible for regul

286、ating and supervising mandatory privately-managed provident fund schemes.It also acts as the Registrar of Occupational Retirement Schemes(ORSO schemes)responsible for regulating the operation of ORSO schemes.32 FSTB,Hong Kong:The Facts:Financial Services,https:/www.gov.hk/en/about/abouthk/factsheets

287、/docs/financial_services.pdfAccounting and Financial Reporting Council:The AFRC regulates an independent regulatory regime of the accounting profession,enhanced to be in line with international developments with increased coherence and efficiency.33Hong Kong Exchanges and Clearing Limited:HKEX is th

288、e holding company of the Hong Kong Stock Exchange(SEHK)and the Hong Kong Futures Exchange(HKFE),which respectively operate the securities and futures markets in Hong Kong,including responsibility for regulating listing matters and ongoing corporate governance of listed companies.It is noteworthy tha

289、t Hong Kongs financial regulators collaborate with each other,and they share the common responsibility of protecting the strength,resilience and integrity of Hong Kongs marketplace.As financial institutions evolve and scale their business practices,products and services,functions of these regulators

290、 will remain as important as ever.33 FSTB,New Regulatory Regime of the Accounting Profession,2022,https:/www.fstb.gov.hk/en/financial_ser/regulatory-reform-of-the-accountin profession.htm Laws,Regulations and Financial Services in Hong Kong2930“Notably,the IA embraces consultative and engaging appro

291、ach in rolling out different regimes while adhering to international standards.It has successfully become the host regulator of several multinational insurance companies.This cements Hong Kongs position as an international risk management and insurance hub.”Ms Winnie Wong Chi-shun CEO&Executive Dire

292、ctor,Asia Insurance&Avo Insurance“Along with our industry peers,we maintain a positive relationship with the SFC and have found them to be very helpful and receptive to a two-way dialogue on all matters of the market.”Ms Virginia Lee Partner,Clifford Chance We have always found the HKEX to be very p

293、rofessional,and their process is transparent,which actually makes Hong Kong an appealing listing venue for us.During the listing phase,they were very receptive and understanding we are in a unique situation.They want to abide by the policy,protecting and informing retail investors.Mr Craig Katerberg

294、 Chief Legal&Corporate Affairs Officer,Budweiser Brewing APAC Ltd.“The SFC has expanded its regulatory framework to include granting licences for virtual asset trading platforms following the latest developments of Web 3.0,which includes NFTs and cryptocurrencies.The SFCs approach is indicative of t

295、heir responsiveness in addressing emerging market opportunities and managing risk for businesses and investors.”Mr Evan Auyang Group President,Animoca BrandsLaws,Regulations and Financial Services in Hong Kong2930“Notably,the IA embraces consultative and engaging approach in rolling out different re

296、gimes while adhering to international standards.It has successfully become the host regulator of several multinational insurance companies.This cements Hong Kongs position as an international risk management and insurance hub.”Ms Winnie Wong Chi-shun CEO&Executive Director,Asia Insurance&Avo Insuran

297、ce“Along with our industry peers,we maintain a positive relationship with the SFC and have found them to be very helpful and receptive to a two-way dialogue on all matters of the market.”Ms Virginia Lee Partner,Clifford Chance We have always found the HKEX to be very professional,and their process i

298、s transparent,which actually makes Hong Kong an appealing listing venue for us.During the listing phase,they were very receptive and understanding we are in a unique situation.They want to abide by the policy,protecting and informing retail investors.Mr Craig Katerberg Chief Legal&Corporate Affairs

299、Officer,Budweiser Brewing APAC Ltd.“The SFC has expanded its regulatory framework to include granting licences for virtual asset trading platforms following the latest developments of Web 3.0,which includes NFTs and cryptocurrencies.The SFCs approach is indicative of their responsiveness in addressi

300、ng emerging market opportunities and managing risk for businesses and investors.”Mr Evan Auyang Group President,Animoca BrandsLaws,Regulations and Financial Services in Hong Kong313234 IMD World Competitiveness Centre,IMD World Competitiveness Yearbook 2022,Digital 2021,Talent 2021:summaries,2022,ht

301、tps:/www.imd.org/globalassets/wcc/docs/wco/pdfs/countries-landing-page/hk.pdf 35 Di Johnson,John Rodwell,Thomas Hendry,Analyzing the Impacts of Financial Services Regulation toMake the Case That Buy-Now-Pay-Later Regulation Is Failing,February 2021,https:/ powers of the regulatorsEach of the regulat

302、ors in Hong Kong has similar types of powers of inspection,investigation and examination.The regulators can initiate enforcement actions as an outcome of their findings,and the sanctions that they may impose include revocation and suspension of an offenders license,the imposition of a pecuniary pena

303、lty,private or public reprimand and others.The powers of the financial regulators are not unlimited,however,and are subject to appropriate checks and balances to ensure a fair process for all.They must articulate their concerns to an affected party and allow that party to be heard before making a fi

304、nal decision.When it comes to disciplinary actions imposed by any regulators,they are subject to review by respective tribunals and,when necessary,the Hong Kong courts.These regulators are also subject to judicial review by the courts when they make decisions that are not reviewable under the statut

305、e.The regulatory systemsHong Kong is a member of all the major international regulatory organisations and associations,such as the Financial Stability Board and the International Organization of Securities Commissions.It ranked first in the sub-factor,“Business Legislation”,in the World Competitiven

306、ess Yearbook 2022.34 Differences among Mainland China,Hong Kong and United KingdomMainland China and Hong Kong vs.United KingdomBoth Mainland China and Hong Kong adopt an institutional approach in financial regulation.That is,a firms legal status determines which regulator is tasked with overseeing

307、its activities,from a safety and soundness perspectives as well as business conduct.35 Banking,securities,insurance and pension funds sectors are therefore supervised by separate agencies.On the other hand,the UK has adopted the twin peaks approach which is based on the principle of regulation by ob

308、jective and refers to a separation of regulatory functions between two regulators.The Financial Conduct Authority is in charge of maintaining the stability of banking system,while Prudential Regulatory Authority,a separate regulator oversees financial consumer protection.Mainland China and Hong Kong

309、Mainland Chinas legal system is based primarily on civil law,where statutes are essential reference for judges.In comparison,Hong Kong adopts the common law system and remains the only common law jurisdiction in China.The main defining feature of this system is the courts ability to make laws in the

310、 form of case law,which is determined by rulings on legal precedents.That said,due to the extensive and growing interconnections between Hong Kong and Mainland Chinas financial systems,closer ties and regulatory interaction is expected to be fostered.While the two sets of regulators are legally sepa

311、rate,there are a range of formal and informal cooperative systems in place for both to perform their respective functions.“The relationship between regulators in Hong Kong and Mainland falls under the“One Country,Two Systems”principle of the Basic Law.”Hong Kong maintains a separate legal system and

312、 a separate financial system which includes separate financial laws,regulations and regulators.”Ms Ding Chen Chief Executive Officer,CSOP Asset Management Ltd.Laws,Regulations and Financial Services in Hong Kong313234 IMD World Competitiveness Centre,IMD World Competitiveness Yearbook 2022,Digital 2

313、021,Talent 2021:summaries,2022,https:/www.imd.org/globalassets/wcc/docs/wco/pdfs/countries-landing-page/hk.pdf 35 Di Johnson,John Rodwell,Thomas Hendry,Analyzing the Impacts of Financial Services Regulation toMake the Case That Buy-Now-Pay-Later Regulation Is Failing,February 2021,https:/ powers of

314、the regulatorsEach of the regulators in Hong Kong has similar types of powers of inspection,investigation and examination.The regulators can initiate enforcement actions as an outcome of their findings,and the sanctions that they may impose include revocation and suspension of an offenders license,t

315、he imposition of a pecuniary penalty,private or public reprimand and others.The powers of the financial regulators are not unlimited,however,and are subject to appropriate checks and balances to ensure a fair process for all.They must articulate their concerns to an affected party and allow that par

316、ty to be heard before making a final decision.When it comes to disciplinary actions imposed by any regulators,they are subject to review by respective tribunals and,when necessary,the Hong Kong courts.These regulators are also subject to judicial review by the courts when they make decisions that ar

317、e not reviewable under the statute.The regulatory systemsHong Kong is a member of all the major international regulatory organisations and associations,such as the Financial Stability Board and the International Organization of Securities Commissions.It ranked first in the sub-factor,“Business Legis

318、lation”,in the World Competitiveness Yearbook 2022.34Differences among Mainland China,Hong Kong and United KingdomMainland China and Hong Kong vs.United KingdomBoth Mainland China and Hong Kong adopt an institutional approach in financial regulation.That is,a firms legal status determines which regu

319、lator is tasked with overseeing its activities,from a safety and soundness perspectives as well as business conduct.35 Banking,securities,insurance and pension funds sectors are therefore supervised by separate agencies.On the other hand,the UK has adopted the twin peaks approach which is based on t

320、he principle of regulation by objective and refers to a separation of regulatory functions between two regulators.The Financial Conduct Authority is in charge of maintaining the stability of banking system,while Prudential Regulatory Authority,a separate regulator oversees financial consumer protect

321、ion.Mainland China and Hong KongMainland Chinas legal system is based primarily on civil law.In comparison,Hong Kong adopts the common law system and remains the only common law jurisdiction in China.The main defining feature of this system is the courts ability to make laws in the form of case law,

322、which is determined by rulings on legal precedents.That said,due to the extensive and growing interconnections between Hong Kong and Mainland Chinas financial systems,closer ties and regulatory interaction is expected to be fostered.While the two sets of regulators are legally separate,there are a r

323、ange of formal and informal cooperative systems in place for both to perform their respective functions.“The relationship between regulators in Hong Kong and Mainland falls under the“One Country,Two Systems”principle of the Basic Law.”Hong Kong maintains a separate legal system and a separate financ

324、ial system which includes separate financial laws,regulations and regulators.”Ms Ding Chen Chief Executive Officer,CSOP Asset Management Ltd.Laws,Regulations and Financial Services in Hong Kong3334ConclusionHong Kongs development is built upon the Basic Law,which enshrines the citys governing polici

325、es of“One Country,Two Systems”,and makes the city the only jurisdiction adopting the common law legal system in the country.From the perspective of prominent industry leaders,it is evident that Hong Kongs commitment to the rule of law and judiciary independence gives the city a comparative advantage

326、,and is also well recognised internationally.It is the cornerstone of the citys success as an international financial centre and a global deal-making hub.Moreover,a cluster of stakeholders has been supporting the ecosystem of Hong Kongs legal environment,with each of them playing a crucial role in m

327、aintaining an open,secure and efficient legal framework that ensures a level playing field for business.All in all,thanks to these unique strengths-Hong Kongs highly regarded status as a legal hub for a variety of deal making and dispute resolution services,it bolsters a high degree of confidence fr

328、om individuals and enterprises across the globe for doing international business in Hong Kong.With the strong connectivity with Mainland China,enormous opportunities are presented,especially in cross-boundary integration of legal professionals and in providing legal services.With all these favourabl

329、e factors considered,Hong Kong will continue to thrive and excel in both financial and commercial activities.Appendix 1-Roles and functions of the five regulatory bodies and the exchangeHong Kong Monetary Authority(HKMA)The HKMA is Hong Kongs central banking institution.It has four major functions:3

330、6maintaining currency stability within the framework of the Linked Exchange Rate system;promoting the stability and integrity of Hong Kongs financial system,including the banking system;helping to maintain Hong Kongs status as an international financial centre,including the maintenance and developme

331、nt of Hong Kongs financial infrastructure;andmanaging the Exchange Fund pursuant to the provisions of the Exchange Fund Ordinance (Cap.66).36 HKMA,About the HKMA,https:/www.hkma.gov.hk/eng/about-us/the-hkma/37 HKMA,Banking,https:/www.hkma.gov.hk/eng/key-functions/banking/38 HKMA,Annual Report 2017-2

332、021,https:/www.hkma.gov.hk/eng/data-publications-and-research/publications/annual-report/1720171551920181521620192021Restricted Licence Banks2020194186191190188Figure 4.Number of Hong Kongs AI(2017-2021),(year-end positions)18164171316117121601612The HKMA is responsible for the authorisation,regulat

333、ion and supervision of banking business and the business of taking deposits;the licensing and supervision of Stored Value Facilities;and the designation and oversight of Retail Payment Systems in Hong Kong.In addition,the HKMA is responsible for approving and supervising money brokers operating in the interbank foreign exchange and deposit markets in Hong Kong.As an international financial centre,