Uncertificated securities market regime – targeted for launch in November 2026
The Securities and Futures Commission (SFC) today announced that the uncertificated securities market (USM) regime is targeted to be launched on 16 November 2026.
With broad market support and close collaboration with Hong Kong Exchanges and Clearing Limited (HKEX) and the Federation of Share Registrars Limited (FSR), major work streams for implementing USM are now at advanced stages following steady progress over the past year. Key developments to date include:
-
HKEX and relevant share registrars are at an advanced stage of developing and testing their USM-related systems and processes. Market participants will be invited to participate in testing in the coming months.
-
The SFC has reviewed and approved amendments to various HKEX rules and operational procedures that are necessary for implementing USM, which will be published by HKEX shortly.
-
HKEX and the FSR have also updated their respective Information Papers on USM to include key fee changes under the new regime (Note 1). These will also be published shortly.
-
The SFC is reviewing applications from six FSR members who seek to become Approved Securities Registrars (ASRs). Information on the status of their applications will be published on the SFC's website in the coming weeks.
-
A number of publications and briefings have already been issued and conducted to facilitate the market's understanding of the new regime and its implications. These efforts will continue in the run-up to the implementation of the USM regime and thereafter.
To bring the USM legislation into effect, a commencement notice will be tabled before the Legislative Council in the second quarter of 2026.
“Implementation of the USM regime will further elevate our financial market infrastructure through greater investor choice, more streamlined processes and more opportunities for straight-through-processing. We now have a clear timeline for implementing this important initiative. In the coming months and beyond, we will continue to work with HKEX and the FSR to ensure a smooth launch, and step up efforts to enhance public awareness and understanding of the new regime,” said Mr Rico Leung, the SFC’s Executive Director of Supervision of Markets.
Upon implementation, newly listed securities will be required to be issued in paperless form from the time of listing. For securities already listed prior to the launch date, issuers will be gradually integrated into the USM regime over a five-year period. Issuers and the market will receive advance notice regarding these arrangements. Investors who possess share certificates will have the flexibility to decide when they wish to convert their shares into paperless form.
Intermediaries are encouraged to continue working closely with HKEX in preparing for USM. Given that the existing nominee structure in the Central Clearing and Settlement System (CCASS) will be retained, only limited changes will be made to CCASS processes, most notably the processes for depositing securities into, and withdrawing them out of, CCASS. These changes together with the revised fees may require some adjustments to intermediaries’ own business models and operational processes, as well as to their client and other documentation. Intermediaries should progress their preparation work as quickly as possible to ensure they are ready when the new regime takes effect in November.
The SFC will continue to update its dedicated USM webpage to keep the market informed of the latest developments, while HKEX and the FSR will also continue to release information papers and conduct briefings for various stakeholders (Note 2).
End
Notes:
-
The fee changes are in respect of: (i) depository and nominee fees charged by HKEX to market participants; and (ii) various fees that Approved Securities Registrars (ASRs) may charge registered holders and others. For (i), the fee changes have been approved by the SFC pursuant to section 76 of the Securities and Futures Ordinance. In doing so, the SFC took into account feedback received in 2025 and 2026 when the fee changes were presented to a wide section of the market. For (ii), following a public consultation in 2025, the SFC set limits in respect of three types of fees that an ASR may charge investors. Subsequently, the SFC also worked with HKEX and individual share registrars on appropriate levels for fees charged by ASRs in respect of securities deposited into or already in the Central Clearing and Settlement System (CCASS). Details will be incorporated in information papers to be published shortly by HKEX and the FSR respectively.
-
In 2024, HKEX and FSR each released an information paper setting out the operational arrangements for USM and held briefings to explain the arrangements to the market. Additionally, HKEX published technical documents on its website to facilitate participants’ preparation.
First, please LoginComment After ~