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On 26 April 2024, the Securities and Futures Commission (“SFC”) announced a three-year extension of the Government’s grant scheme to subsidise the setting up of open-ended fund companies (“OFC”) and real estate investment trusts (“REIT”) in Hong Kong (the “Extended Scheme”). The Extended Scheme will be opened for applications starting from 10 May 2024 to 9 May 2027 on a first-come-first-served basis. 

OFC 

Under the Extended Scheme, investment managers who have successfully incorporated an OFC or re-domiciled a non-Hong Kong fund corporation as an OFC in Hong Kong on or after 10 May 2021, will be eligible to apply for the Extended Scheme. 

Each application will be eligible for a grant amounting to 70% of the eligible expenses. Eligible expenses are payments paid to Hong Kong-based service providers in relation to the incorporation of the OFC or the re-domiciliation of the non-Hong Kong fund corporation in Hong Kong as an OFC. However, it is important to note that the grant amount is subject to (i) a cap of HK$1 million per publicly offered OFC; (ii) HK$500,000 per privately offered OFC; and (iii) a maximum of three OFCs per investment manager. 

For OFC grant applications submitted before 10 May 2024, the original parameters of the Government’s grant scheme will continue to apply. For more details on the original parameters, please refer to our previous article on the government’s grant scheme for OFC. 

REIT 

For SFC-authorised REITs listed on the Stock Exchange of Hong Kong Limited (“SEHK”) on or after 10 May 2021, they must have minimum capitalisation of HK$1.5 billion (or equivalent) at the time of listing. For a REIT which is also listed outside Hong Kong, it must have minimum market capitalisation of its units listed on SEHK amounting to HK$1.5 billion (or equivalent) at the time of the SEHK listing. 

The grant amount for each REIT application will be 70% of the eligible expenses, which are payments that were paid to Hong Kong-based service providers in relation to the listing of the REIT. The grant amount is subject to a cap of HK$8 million per REIT. 

Contact us today if you would like to learn more about the Extended Scheme or require assistance with your application. 

WRITTEN BY

For further information, please contact:

Greg Heaton – Partner,
gregheaton@hauzen.hk

Greg Heaton is a partner of Hauzen LLP. He is a legal and financial services professional with over 20 years of experience in advisory and regulatory roles.

Admitted as a solicitor of the High Court of Hong Kong and a legal practitioner of the Supreme Court of New South Wales, he was formerly a partner of another Hong Kong law firm, advising on asset management, securities regulation, and contentious regulatory matters, and director of an international consultancy firm, providing regulatory advice and project-based consultancy services to Hong Kong and global financial services firms.

In addition, he was formerly a senior director of the Securities and Futures Commission (SFC), where he played a key role in the oversight of SFC-licensed intermediaries and the development of regulatory policy. He was head of the Licensing Department at the SFC and a member of the Board of the Financial Dispute Resolution Centre, the body responsible for the arbitration and mediation of disputes between financial institutions and their clients.

Education

  • University of New South Wales, Master of Law and Management (2005)
  • Australian Graduate School of Management, Graduate Diploma in Management (2003)
  • University of Canterbury, LL.M. Honours (First Class) (2000)
  • University of New South Wales, LL.B. (1999)
  • University of Canterbury, B.A. (1995)
  • Osaka University of Foreign Studies, Diploma of Japanese Language and Culture (1994)

Experience

  • Advising on securities regulation, listing rules and corporate governance.
  • Fund formation and restructuring.
  • Acquisition and sale of SFC licensed corporations.
  • Drafting business plans, compliance manuals, operations manuals and services agreements.
  • Contentious regulatory matters including SFC investigations and disciplinary actions.
  • Assisting licensed corporations with preparation for and handling of regulatory inspections.
  • Conducting audits of licensed corporations’ operations and internal control frameworks.
  • Advising on APAC licensing requirements, product disclosure rules and marketing restrictions.
  • Providing training on regulatory requirements and industry developments.

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