ENG-2016 — Page 100

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Financial and Monetary Affairs

placements for graduates and a financial incentive for in-service practitioners to undergo training. The objective of the programme is to enable the community, particularly students, to better understand the wide spectrum of jobs available in these two sectors so as to attract new blood and enhance the professional competency of the sectors.

Financial Services Development Council

The Financial Services Development Council is a high-level, cross-sectoral government advisory body that collects industry views to formulate strategic proposals for the development of the industry. It published seven reports in 2016 on these subjects: regulations on exchange-traded derivatives, equity crowdfunding, RMB capital account convertibility, green finance, the Mainland-Hong Kong Bond Market Connect, the National 13th Five-Year Plan and tax issues related to international financial products. The government seeks to implement the council's recommendations where appropriate to boost the financial services industry, and provides the necessary resources and fully supports the council's work.

Improving Market Quality and Financial Consumer Education and Protection International financial centres pursue regulatory reform to enhance the resilience and stability of the global financial system and ensure adequate investor protection to promote confidence in the financial system. In Hong Kong, the government drives, facilitates and coordinates initiatives to ensure the overarching framework will enhance protection for investors and promote market development in the face of both global needs and local circumstances.

Short Position Reporting

Following a public consultation, the SFC announced in February 2016 that reporting would be required for short positions in all designated securities eligible for short selling specified by the SEHK. The new requirement will take effect on 15 March 2017, when the Securities and Futures (Short Position Reporting) (Amendment) Rules 2016 becomes effective.

Regulation of Asset Management

The SFC seeks to ensure Hong Kong's regulatory regime for asset management is in line with international regulatory developments. It launched a public consultation in November on proposed changes to its Fund Manager Code of Conduct in respect of areas including securities lending and repurchase agreements, custody of fund assets, liquidity risk management, and disclosure of leverage by fund managers. Amendments were also proposed to the Code of Conduct for Persons Licensed by or Registered with the SFC to address potential conflicts of interest in the sale of investment products and enhance disclosure at the point of sale.

Regulation of OTC Derivatives

Following an HKMA-SFC joint public consultation, six pieces of subsidiary legislation were gazetted on 5 February 2016 to implement the second stage of the OTC derivatives regulatory regime. These include the introduction of mandatory clearing of certain interest rate derivatives on 1 September 2016, and the expansion of mandatory reporting to cover all five main asset classes on 1 July 2017. The revised Guidelines for the Regulation of Automated Trading Services,

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