Investor Presentaiton
Implications for US Managers Marketing Private Funds
to Investors in Hong Kong & Mainland China
Marketing, Disclosure & Enforcement
-
-
- The SFC takes seriously suitability requirements, so managers should be prepared to
demonstrate that they are following a process in screening potential investors for products
being marketed to investors based in Asia. Following a standard Regulation D seasoning
period by establishing a relationship prior to allowing investment would suffice to meet any
suitability requirements sought in Hong Kong.
The SFO grants to the SFC criminal jurisdiction over certain violations of the securities laws in
Hong Kong. This differs from the United States, where the SEC has civil authority and must
conduct joint investigations with the DOJ in situations where criminal liability is sought.
Accordingly, the potential scope of penalties for misconduct is higher in Hong Kong than in the
United States.
Managers based in other jurisdictions should also be aware that regulatory inquiry in Hong
Kong may lead to the same conduct being investigated by the home jurisdiction.
Morgan Lewis
26View entire presentation