Legal Update: Hong Kong’s push to list private equity funds on the Hong Kong Stock Exchange
Introduction
On 17 February 2025, the Securities and Futures Commission of Hong Kong (SFC) issued a circular providing guidance on the listing of closed-ended alternative funds on the Stock Exchange of Hong Kong Limited (SEHK).
Although the current regulatory regime already caters for alternative funds to be listed on SEHK, the latest circular clarifies the requirements particularly for funds that invest mainly in private and less liquid assets such as private equity, private credit, infrastructure equity and infrastructure debt funds.
Whether you are a fund manager, investor or distributor, here are 5 key facts you need to know:
| Fund eligibility |
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Distribution policy
| Preferably be able to generate regular income on a continuous basis.
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| Quarterly NAV | The listed fund’s NAV to be published on the fund’s website at least on a quarterly basis.
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| Management company |
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Widely held
| Interests in the listed fund must be widely held with the public holding at least 25% of the total units or shares of the fund at all times.
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The latest regulatory guidance represents a concrete step by the Hong Kong Government to broaden private equity fund distribution in line with its 2024 Policy Address.
The circular contains additional clarifications on additional matters such as the SFC authorisation and SEHK listing process, investor knowledge test, investor education and knowledge assessment, disclosure requirements and valuation on which we can advise you.
Please do not hesitate to contact our experienced Funds team at CMS Hong Kong in association with CMS Hasche Sigle, Hong Kong LLP to discuss how we may help you. We are dedicated to tailoring solutions that meet your specific business needs and ensuring compliance with regulatory requirements.
