Does Your Company Need an SFC Licence to Operate in Hong Kong?

Kristina Coluccia
2 days ago
3 min read

Hong Kong is widely recognised as one of the world’s leading international financial centres, attracting businesses across asset management, investment, securities, and advisory services. However, if your company intends to conduct certain regulated financial activities, you may be required to obtain a licence from the Securities and Futures Commission (SFC). Understanding whether your business falls under these licensing requirements is critical for compliance, credibility, and long-term growth.

What Is an SFC Licence?

The Securities and Futures Commission (SFC) is the regulatory authority overseeing Hong Kong’s securities and futures markets. It administers the Securities and Futures Ordinance (SFO), which sets out the framework for regulating financial intermediaries and their activities.

An SFC licence grants authorisation for companies or individuals to carry out specific “regulated activities.” Without the appropriate licence, conducting these activities is unlawful and may result in severe penalties, including fines, imprisonment, or being prohibited from operating in the financial industry.

Which Activities Require an SFC Licence?

The SFO outlines 10 types of regulated activities. Your company may need an SFC licence if it intends to engage in:

Dealing in securities (e.g., brokerage services, securities trading)
Advising on securities (e.g., investment advisory services)
Asset management (e.g., managing portfolios of securities or futures contracts)
Dealing in futures contracts
Advising on futures contracts
Leveraged foreign exchange trading
Advising on corporate finance (e.g., M&A advisory, IPO-related work)
Providing automated trading services
Securities margin financing
Advising on real estate investment trusts (REITs)

If your business is involved in any of these activities—even on a cross-border or limited scale—you may need to obtain the relevant SFC licence before commencing operations.

Exemptions from SFC Licensing

Not all financial activities require an SFC licence. Some exemptions apply, such as:

Activities carried out solely outside of Hong Kong.
Incidental activities that are directly related to your main business (and not a separate service).
Certain professionals, such as lawyers or accountants, providing advice as part of their ordinary practice.

It is essential to review these exemptions carefully, as relying on them without proper assessment may expose your company to regulatory risks.

Why Compliance Matters

Operating without an SFC licence when required can have serious consequences. Beyond financial penalties, non-compliance can damage your company’s reputation, limit access to banking and investment partners, and potentially jeopardise future business opportunities in Hong Kong’s highly competitive financial sector.

On the other hand, being properly licensed enhances your company’s credibility, assures clients of regulatory oversight, and facilitates long-term growth within the region’s robust financial ecosystem.

Conclusion

Determining whether your company requires an SFC licence in Hong Kong depends on the nature of your business activities and their classification under the Securities and Futures Ordinance. Given the complexity of financial regulations, seeking expert guidance is highly recommended to ensure compliance and avoid costly mistakes.

At Woodburn Accountants & Advisors, we specialise in helping international businesses navigate Hong Kong’s regulatory landscape. From assessing your licensing needs to coordinating with the SFC and ensuring full compliance, our team provides end-to-end support tailored to your business goals. Contact us today to ensure your company is set up for success in Hong Kong’s financial sector.

Woodburn Accountants & Advisors is one of China and Hong Kong’s most trusted business setup advisory firms.

Woodburn Accountants & Advisors is specialized in inbound investment to China and Hong Kong. We focus on eliminating the complexities of corporate services and compliance administration. We help clients with services ranging from trademark registration and company incorporation to the full outsourcing solution for accounting, tax, and human resource services. Our advisory services can be tailor-made based on the companies’ objectives, goals and needs which vary depending on the stage they are at on their journey.