SEC Establishes Supervisory Cooperation Arrangement With Hong Kong SFC
The SEC and Hong Kong’s SFC established a supervisory cooperation arrangement to enhance cross-border oversight of financial entities, with no fraud, charges, or penalties involved—only improved regulatory information sharing and on-site examination capabilities.
The U.S. Securities and Exchange Commission (SEC) and Hong Kong’s Securities and Futures Commission (SFC) have entered into a comprehensive supervisory cooperation arrangement to expand information sharing beyond the 1995 agreement, which was limited to investment management. The new framework enables ongoing exchange of supervisory data—including risk concentrations, compliance culture, and examination findings—on broker-dealers, investment advisers, securities exchanges, market infrastructure providers, and credit rating agencies operating in both jurisdictions. This initiative supports proactive regulatory oversight and on-site examinations but involves no allegations of fraud, enforcement actions, or monetary penalties.
The U.S. Securities and Exchange Commission (SEC) and Hong Kong’s Securities and Futures Commission (SFC) have formalized a comprehensive supervisory cooperation arrangement to strengthen cross-border oversight of financial entities operating in both markets. This new framework expands upon a 1995 agreement that previously focused only on investment management activities, now encompassing broker-dealers, investment advisers, securities exchanges, market infrastructure providers, and credit rating agencies. The arrangement facilitates the ongoing exchange of supervisory information, including risk assessments, compliance culture evaluations, and examination data, to improve monitoring of global firms and detect emerging systemic risks. Unlike enforcement-focused memoranda of understanding (MOUs), this agreement is designed for continuous, proactive regulatory collaboration rather than reactive investigations into misconduct. It also enables regulators to conduct on-site examinations of registered entities located outside the U.S., enhancing the SEC’s ability to supervise international operations. The initiative reflects over three decades of SEC experience in cross-border cooperation, beginning with MOUs in the late 1980s. Importantly, this is not an enforcement action—no fraud, accused parties, dollar amounts, or legal penalties are involved; the focus is solely on improving regulatory coordination and oversight.
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Extracted insights
- person enforcement cooperation mous
- person new supervisory cooperation arrangement
- agency sec and counterparts
- agency sec office of international affairs
- agency Securities and Exchange Commission
- person supervisory cooperation arrangements
- SEC established arrangement with Hong Kong Securities and Futures Commission
- SEC announced comprehensive arrangement with Hong Kong Securities and Futures Commission
- New Supervisory Cooperation Arrangement expands upon 1995 arrangement limited to investment management activities
- Paul A. Leder is Director of SEC Office of International Affairs
- SEC has experience with cross-border cooperation for more than three decades starting in late 1980s
- SEC uses MOUs to facilitate information sharing in securities enforcement matters
- Enforcement Cooperation MOUs help SEC collect information abroad to investigate securities-law violations
- Supervisory Cooperation Arrangements establish mechanisms for ongoing consultation and exchange of information regarding oversight of global firms
- SEC and Counterparts can conduct on-site examinations of registered entities located outside U.S.
The Securities and Exchange Commission today announced that it has established a comprehensive arrangement with the Hong Kong Securities and Futures Commission (SFC) as part of the SEC’s long-term strategy to enhance the oversight of regulated entities that operate across national borders. Hong Kong is a major financial center and the new supervisory cooperation arrangement will augment the SEC’s and the SFC’s ability to share information about regulated entities that operate in the U.S. and Hong Kong, including investment advisers, broker-dealers, securities exchanges, market infrastructure providers, and credit rating agencies. The new comprehensive arrangement expands upon the one from 1995 that was limited to investment management activities. “By creating a formal channel for exchanging supervisory information with the SFC, this new arrangement will enhance the SEC’s ability to supervise firms on a cross-border basis,” said Paul A. Leder, Director of the SEC’s Office of International Affairs. The SEC’s approach to supervisory cooperation with its overseas counterparts builds on more than three decades of experience with cross-border cooperation, starting in the late 1980s with memoranda of understanding (MOUs) facilitating information sharing between the SEC and other securities regulators in securities enforcement matters. Enforcement cooperation MOUs help the SEC collect information abroad to investigate securities-law violations and compensate victims of securities fraud when possible. Supervisory cooperation arrangements establish mechanisms for ongoing consultation and the exchange of information regarding the oversight of global firms and markets. Such information may include routine supervisory information as well as information regulators need to monitor risk concentrations, identify emerging risks, and better understand a globally active regulated entity’s compliance culture. These arrangements also facilitate the ability of the SEC and its counterparts to conduct on-site examinations of registered entities located outside the U.S. Additional information about SEC cooperation arrangements with foreign regulators can be found at: http://www.sec.gov/about/offices/oia/oia_cooparrangements.shtml
The Securities and Exchange Commission today announced that it has established a comprehensive arrangement with the Hong Kong Securities and Futures Commission (SFC) as part of the SEC’s long-term strategy to enhance the oversight of regulated entities that operate across national borders. Hong Kong is a major financial center and the new supervisory cooperation arrangement will augment the SEC’s and the SFC’s ability to share information about regulated entities that operate in the U.S. and Hong Kong, including investment advisers, broker-dealers, securities exchanges, market infrastructure providers, and credit rating agencies. The new comprehensive arrangement expands upon the one from 1995 that was limited to investment management activities. “By creating a formal channel for exchanging supervisory information with the SFC, this new arrangement will enhance the SEC’s ability to supervise firms on a cross-border basis,” said Paul A. Leder, Director of the SEC’s Office of International Affairs. The SEC’s approach to supervisory cooperation with its overseas counterparts builds on more than three decades of experience with cross-border cooperation, starting in the late 1980s with memoranda of understanding (MOUs) facilitating information sharing between the SEC and other securities regulators in securities enforcement matters. Enforcement cooperation MOUs help the SEC collect information abroad to investigate securities-law violations and compensate victims of securities fraud when possible. Supervisory cooperation arrangements establish mechanisms for ongoing consultation and the exchange of information regarding the oversight of global firms and markets. Such information may include routine supervisory information as well as information regulators need to monitor risk concentrations, identify emerging risks, and better understand a globally active regulated entity’s compliance culture. These arrangements also facilitate the ability of the SEC and its counterparts to conduct on-site examinations of registered entities located outside the U.S. Additional information about SEC cooperation arrangements with foreign regulators can be found at: http://www.sec.gov/about/offices/oia/oia_cooparrangements.shtml