Webinar | Hong Kong Regulation of Virtual Assets Trading Platforms | 20 October 2023

On 20 October 2023, Julia Charlton presented a webinar on Hong Kong Regulation of Virtual Asset Trading Platform. This webinar will cover Hong Kong’s licensing regime for virtual asset trading platforms, the ongoing obligations and various restrictions on their activities once they become licensed, the statutory offences that cover misconduct involving virtual assets and the latest development of the JPEX scandal.
This webinar will cover the following topics in detail:
Introduction to the licensing regimes under the AMLO & SFO;
Key Definitions: virtual assets, VASPs etc;
The Licensing Requirements: Financial Resources; Responsible Officers; Licensed; Representatives; Ultimate Owners & Substantial Shareholders, MICs;
External Assessment Reports;
Licensing Conditions: Token Admission Review Committee; VA due diligence and admission criteria;
Conditions for offering VA for retail trading;
Prohibited activities;
VASP’s obligations re: suitability, disclosure, handling client assets, insurance & compensation;
AML and CTF obligations and Application of Travel Rule to VA transfers;
VASP’s ongoing reporting obligations & CPT requirements;
Market misconduct offences;
AMLO licensing regime’s transitional arrangements; and
Latest development of the JPEX scandal.
#SFC #VASP #licensingrequirements
Timecodes:
00:00 Julia Charlton's welcome speech
00:57 2 Licensing Regimes for VATPs
02:56 Financial Action Task Force (FATF) Requirements
07:44 AMLO Licensing Requirements
09:21 SFC FAQS on Active Marketing
10:30 Providing a VA Service
12:57 Virtual Assets Definition
14:09 Exclusions from Virtual Asset Definition
14:55 SFO Licensing
16:30 Regulatory Requirements for Licensed VATP Operators
17:40 Eligibility for Licensing under AMLO & SFO
18:01 Platform Operators’ Fitness & Properness
18:12 Licensed VATP: Financial Resources Requirement
18:54 Platform Operators’ Competency requirements
20:53 Responsible Officer Requirements
22:03 Licensed Representatives
00:00 licensed representatives‘ required educational Qualifications & Experience
00:00 Substantial Shareholders and Ultimate Owners
00:00 SFC Approval of a VATP’s Ultimate Owner
00:00 Managers-In-Charge of Core Functions (MICs)
00:00 VATP Complaints Officer & Emergency Contact Person, SFC Approval of Premises
00:00 VATP Licensing Application Process
00:00 Submission of Platform Operators’ Bank Account Information, SFC Regulatory Sandbox
00:00 VATP Licensing Conditions
00:00 Token Admission and Review Committee Requirements
00:00 VATP Obligations, Responsibility for Conduct & Adherence to Procedural Requirements
00:00 General Token Admission Criteria
00:00 Specific Token Admission Criteria for Retail Traded VA
00:00 Providing VA Trading Services to Retail Investors
00:00 Prohibition on Trading Virtual Asset Derivatives and other Restricted Activities
00:00 Protections for Retail Investors, Retail Clients’ Knowledge of VA
00:00 Suitability Obligations in the Context of Complex Products
00:00 VATPs’ Disclosure Obligations
00:00 Disclosure of Information for each Virtual Asset Traded
00:00 VATPs’ Obligations re. Handling Client Virtual Assets
00:00 Licensed Platform Operators: Insurance and Compensation Provision
00:00 Anti-Money Laundering & Counter-Terrorist Financing Obligations
00:00 Application of the Travel Rule to VA Transfers
00:00 Auditor Appointment and Submission of Audited Accounts/ Financial Resources Returns
00:00 Changes to VATP Licences Requiring Prior SFC Approval
00:00 Changes and Events Requiring Notification to the SFC
00:00 Continuous Professional Training Requirements for Licensed Individuals
00:00 The Market Misconduct Regime under the AMLO
00:00 Market Misconduct Regime Offence Involving Fraudulent or Deceptive Devices etc, in Transactions in VA
00:00 The SFO’S Market Misconduct Regime
00:00 Offence to Issue Advertisements to the HK Public to Acquire, Dispose of, Subscribe for or Underwrite Securities
00:00 SFC Sanctioning Powers: s53ZSP AMLO & s194 SFO
00:00 Individuals' Liability: s53ZSR(5) AMLO & s193(2) SFO
00:00 s53ZTH AMLO & s213 SFO
00:00 SFC Powers with Respect to Licensed Virtual Asset Platform Operators
00:00 Transitional Arrangements for VA Exchanges Operating in HK before 1 June 2023
00:00 SFC Warning: VATPS Engaging in Improper Practices - 7 August 2023
00:00 Police Arrests Relating to Unlicensed VATP - JPEX
00:00 JPEX Allegations
00:00 SFC Lists of VATPS
00:00 SFC & HK Police Joint Working Group
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Julia Charlton
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