SFC's enhanced position limit regime to take effect
The Securities and Futures Commission (SFC) announced today that the amendments to the Securities and Futures (Contracts Limits and Reportable Positions) Rules (the “Rules”) will come into effect on 22 December 2023 (Note 1).
The amendments will enhance the position limit regime in several ways. These include clarifying the application of the Rules to asset managers who manage funds or sub-funds of umbrella funds and the regulatory expectations for trustees in respect of the Rules’ requirements, expanding the list of “specified contracts” for granting excess position limits, introducing an excess position limit regime for clearing participants, raising the statutory position limits for certain futures and options contracts, prescribing position limits and reporting levels for some new contracts, and imposing large open position reporting requirements for holiday trading contracts.
The changes aim to give more clarity on regulatory requirements related to funds, facilitate compliance and provide more flexibility to the market.
To help market participants understand the amendments, the SFC has also published an FAQ and updated the guidance note on related regulatory requirements.
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Note:
- On 5 June 2023, the SFC published conclusions to its further consultation on proposed changes to the position limit regime for the derivatives market.
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