What is the 178 license?
We often hear people mention the 178 license, what does that mean exactly? In fact “178 license” is perhaps a common misnomer. 178 does not refer to a license, but a combination of exam papers that need to be taken; that is, a combination of three exam papers, paper 1, paper 7, and paper 8. In Hong Kong, obtaining commissions to assist clients in buying and selling securities and other related business are related activities. A license must be obtained before these regulated activities can be carried out. One of the competency requirements of applying for a license to become a representative and/ or responsible officer is to pass the designated exam combination of HKSI (Hong Kong Securities and Investment Institute) LE (Licensing Examination). Therefore, those who wish to engage in regulated activities in the securities industry need to register for the LE exam at HKSI. However, passing the exam in itself does not mean successfully obtaining a license! So if you just pass the exam, it does not mean that you have a license. You must meet other listing requirements, such as age, education, work experience, criminal record, and financial status, before you can apply for a license.
If I want to take the securities exam, where should I register?
The institution that holds the Licensing Exam (LE) for securities and futures practitioners is HKSI, and the examination is recognizable as one of the licensing conditions in Hong Kong. However, HKSI only holds examinations, and the license for regulated activities in the securities industry is approved by the Securities and Futures Commission (SFC). The SFC is independent of the Hong Kong government. It is a statutory body responsible for overseeing Hong Kong’s securities and futures markets. It is also a regulator of Hong Kong’s financial and securities industries, but its functions do not include conducting examinations. Therefore, the exam must be conducted through HKSI, and not SFC.
To apply for an SFC license, sometimes it is necessary to apply for more than one examination and obtain a passing grade. The most popular combination of examination papers are HKSI LE Papers 1, 7, 8. The HKSI LE exam has 14 different exam papers. Those who do not have any work experience in the securities industry but intend to make entry into the securities industry need to take a specified combination of test papers depending on the type of activity they are hoping to engage in. In other words, selling or providing different services or products requires different exam paper combinations. For example, if you want to trade securities products such as Hong Kong stocks, US stocks, bonds, etc. on behalf of your clients, you need to take HKSI LE papers 1, 7, and 8. Or if you want to work in an asset management company and deal with products related to funds or entrusted accounts, you may need papers 1, 7, and 12. You can first refer to the following chart to estimate what combination of exam papers you need to take, and then refer to the exemption conditions to determine whether you need to take the entire combination of exam papers.
For exemption information, please reference:
What people are commonly referring to when they mention the term “ SFC license”?
The Securities and Futures Commission is the SFC, which is the statutory regulator of the financial and securities industry in Hong Kong. The SFC was established under the Securities and Futures Ordinance, and its responsibility is to ensure that the securities industry is fair and orderly. The SFC is independent of the Hong Kong government but is given the power to make subsidiary legislation, investigate the affairs of the securities industry, grant and revoke licenses for regulated activities in securities and futures industry. If a company (a company that is not a bank or an authorized financial institution) wants to be qualified for regulated activity, it needs to obtain a license from the SFC for the regulated activity under the legal requirements. Employees who conduct regulated businesses under the organization’s name will be collectively referred to as licensees after being licensed. If a client complaints a licensed corporation or a licensee, the complaint will be handled by the SFC. If you want to search for basic information regarding the licensee or licensed corporations such as license number, license type, company, etc., you can
- go to the SFC’s register public search: https://apps.sfc.hk/publicregWeb/searchByName
2. Enter its full name in Chinese or English or the CE code.
What is an HKMA license?
The Hong Kong Monetary Authority (HKMA) is the statutory regulator of Hong Kong’s financial securities industry. The HKMA is an independent statutory body. One of its major functions is to regulate and authorize banks or authorized financial institutions (ie licensed banks, restricted license banks and deposit-taking companies), including industry regulations and compliance in the banking industry. Category. In Hong Kong, the business of banks is diversified, and some banks even participate in the securities business. But the HKMA is not the main regulator of the securities industry. The SFC is the expert in this area. However, the SFC does not want to have more work, and does not want to issue licenses directly to banks, which will result in a more complicated regulatory framework. Banks that need to conduct regulated securities business should be jointly supervised by the Securities and Futures Commission. The HKMA will provide direct front-line supervision, and the FSC will only cooperate passively.
Therefore, banks that conduct securities business will only be registered as “registered institutions” with the Securities and Futures Commission, not “licensed corporations” directly issued by the Securities and Futures Commission. Therefore, employees who conduct regulated activities in “registered institutions” are also registered with the SFC and are called registrants, not licensees. It is also worth mentioning that although these registrants are registered with the Securities and Futures Commission in name, in fact, all forms and communication are carried out with the HKMA. If there is any dismissal of registered institutions, the HKMA will also handle it. ( Reference Information: https://www.sfc.hk/en/Regulatory-functions/Intermediaries/Licensing/Types-of-intermediary-and-licensed-individual)
If you want to search for basic information about a registrant in HKMA’s public search, such as license number, license type, company, etc., you can go to the HKMA’s public search Link: https://apps.hkma.gov.hk/eng/index.php? c=search&m=search_by_name
- Read and agree to the statement to continue
- Enter its full name in Chinese or English (the first or last name cannot include extra spaces), or the registration number, for example, Chan Tai Man, if you enter ” Chan Tai Man” or “Chan Tai Man “, the search results will not be displayed correctly.
- Enter confirmation code
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