SFC Circular on FAQs Updates Regarding CPI Asessment & Family Office FAQs

On 8 September 2020, the SFC issued a circular regarding updates to the FAQs on Corporate Professional Investor (“CPI”) Assessment. The updated FAQs (https://www.sfc.hk/en/faqs/intermediaries/supervision/Professional-Investors/Professional-Investors#2) provide further guidance on the assessment of the corporate structure and investment process of CPI, in particular, those investment vehicles owned by family trusts or family offices that engage investment professionals to manage their investments.

The FAQ updates followed changes that PWMA proposed to SFC, and reflect valuable input and feedback from a number of our PWMA members, for which we are thankful. We believe the results should be extremely helpful in allowing many Single Family Offices that are run by experienced professionals to qualify as Corporate Professional Investors, something the Association has advocated for some time.

The SFC has also published a set of FAQs (https://www.sfc.hk/en/faqs/intermediaries/licensing/Family-Offices#4) to provide additional guidance on the implications of the licensing regime under the Securities and Futures Ordinance to single family offices and multi-family offices. These FAQs are the result of productive dialogue facilitated through the Financial Services Development Council, and should help Family Offices achieve greater clarity in understanding whether or not they need to be licensed to conduct their investment activities in Hong Kong.

Together, we believe the updated FAQs should be welcomed and will help promote growth of Hong Kong as a Family Office hub, which PWMA members have in our previous annual surveys identified as a key growth driver for the industry going forward.