What exams should I take from HKSI to become a licensed representative (LR) or responsible officer (RO) for the Securities and Futures Commission (SFC)?

May 16, 2023

The Hong Kong Securities and Investment (HKSI) Licensing Examination (LE) is one of the most popular exams in the Hong Kong financial market. It primarily tests an individual’s professional knowledge and abilities in securities and investments in order to obtain a license to practice in the securities and investment industry.

There are currently 15 different papers for the HKSI LE exam, which are divided into regulatory papers, application papers, and sponsor papers, among others. Candidates typically need to pass the regulatory papers and either the application or sponsor papers in order to participate in SFC regulatory activities.

Is it necessary to take every paper in the exam?

The answer is NO! According to Schedule 5 of the Securities and Futures Ordinance, there are 10 different regulated activities, and different combinations of papers are required for participating in each activity.

Please note that the regulated activity categories do not correspond directly to the HKSI exam paper numbers. This means that wanting to engage in regulated activities in Category 2 does not necessarily require taking HKSI Paper 2.Apart from Paper 1, the HKSI Securities and Investment (S&I) Licensing Examination has two categories of papers in Paper 2 to Paper 6 for responsible officers (RO) or executive officers (EO), and Paper 7 to Paper 12 for licensed representatives (LR) or relevant individuals (ReI).If you do not have any experience in the securities industry, you should start by becoming a licensed representative/ relevant individual.

The following is the exam combination for applying to be a licensed representative:

For example, if you want to become a licensed representative (LR) of a licensed corporation and participate in securities trading, buying and selling securities products such as Hong Kong stocks, US stocks, bonds, etc. on behalf of clients, you may need to pass Papers 1, 7, and 8 of the HKSI exam.

To participate in futures contract trading, the required papers would be Papers 1, 7, and 9.

If you wish to work for an asset management company and handle products related to funds or discretionary accounts, you may need to take Papers 1, 7, and 12.

Paper 1 covers the “Basic Securities and Futures Regulations”, Paper 7 covers “Financial Markets”, Paper 8 covers “Securities”, Paper 9 covers “Derivatives”, and Paper 12 covers “Asset Management”.

Responsible officers are senior management personnel of licensed corporations (LC), while executive officers are senior management personnel of registered institutions (RI).

Responsible officers/executive officers are responsible for supervising the regulated activities of the company to ensure compliance with SFC regulations and requirements.

To become a responsible officer/executive officer, at least 3 years of securities industry experience is required, including at least 2 years of experience in managing subordinates.

If you want to become a responsible officer (RO) or executive officer (EO) of a licensed corporation, you need to pass the following exams:

For example, if a responsible officer needs to supervise the securities trading operations of a company to ensure compliance with SFC regulations and requirements, they need to pass Papers 1 and 2, with Paper 2 covering the “Securities Regulations”.Unless exempted, responsible officers typically need to take more regulatory papers than licensed representatives.

If you already hold an SFC license for a regulated activity and apply for a license for another regulated activity, are your previous exam results still valid?

The answer is yes.

According to the SFC’s “Competency Guidelines”, “If an individual has been licensed as a licensed representative or responsible officer for a relevant regulated activity by a local regulatory regime and has passed the relevant local regulatory regime examinations within the preceding three years, the SFC will recognize the relevant local regulatory regime examinations passed by the individual within three years.”

For example, if student A passed Papers 1, 7, and 8 three years ago and obtained an SFC license for regulated activity Type 1 – Securities Trading within the past three years, they do not need to retake Papers 1 and 7 when applying for an SFC license for regulated activity Type 2 – Futures Contract Trading. Instead, they only need to take Paper 9.

Are there any exemptions for the HKSI exam?

Yes. If you have relevant academic qualifications, professional certifications, or industry experience, you may be exempted from taking Papers 7 to 12 of the HKSI exam. For details, please refer to “How to Apply for Exemption from HKSI LE?”

How can we help?

2CExam provides HKSI LE, IIQE, EAQE and SQE related exam preparation materials. We sell mock question banks for HKSI LE Papers 1, 2, 3, 5, 6, 7, 8, 9, 12 in Chinese and English; and bibles for HKSI LE Papers 1, 2, 6, 7, 8 in Chinese. We also offer 1 on 1 tutorial services. Besides, we have also made free tutorial videos for HKSI LE Papers 1, 2, 6, 7, 8, 12 and posted on public channels such as Youtube/ Bilibili/ Tencent/ Iqiyi. 2CExam has been an exam training expert for years. Should you need any help please visit www.2cexam.com or contact us through:

Phone +852 2110 9644 Email: [email protected] Wechat: hk2cexam WhatsApp: +852 9347 2064

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