Following announcements during the 2024-25 Budget by the Finance Secretary Paul Chan on the extension of the grant scheme for open-ended fund companies (OFCs) and real estate investment trusts (REITs) for three years, the Securities and Futures Commission (SFC) issued new guidelines on the extended grant scheme (Extended Scheme) on 26 April 2024.
For OFCs incorporated in or re-domiciled to Hong Kong and SFC-authorised REITs listed on the Stock Exchange of Hong Kong Limited, the Extended Scheme will continue to cover 70% of eligible expenses paid to Hong Kong-based service providers, subject to a cap of HK$1 million per publicly offered OFC, HK$500,000 per privately offered OFC and HK$8 million per REIT. The Extended Scheme will be applicable for grant scheme applications submitted on or after 10 May 2024 and will be available up to 9 May 2027 on a first-come-first-served basis or where the government’s funding is fully committed, whichever earlier. Each eligible investment manager holding a type 9 SFC licence for conducting asset management regulated activities will have a quota of three OFCs under the grant scheme irrespective of whether an application was submitted on or before 10 May 2024.
It is worth noting that the cap available under the Extended Scheme applicable to the incorporation of or re-domiciliation to Hong Kong as private OFCs has been reduced from HK$1 million under the existing grant scheme (applicable prior to 10 May 2024) to HK$500,000 under the Extended Scheme.
For investment managers who have submitted an application for the grant scheme before 10 May 2024, the original parameters of the existing grant scheme will apply and, in respect of private OFCs, the cap of HK$1 million per OFC will continue to apply.
