Key facts
- Hong Kong regulators expanded cooperation on financial reporting and audits to licensed crypto firms.
- The SFC and AFRC signed a new MoU covering financial and compliance reporting for licensed virtual asset service providers.
- The agreement also includes audit and assurance work, information sharing, and coordinated investigations.
- The MoU replaces a similar agreement from 2021.
Hong Kong's financial regulators have broadened their oversight of the virtual asset sector through a new memorandum of understanding (MoU) signed between the Securities and Futures Commission (SFC) and the Accounting and Financial Reporting Council (AFRC). The agreement, announced on Monday, enhances cooperation on financial reporting, audits, and compliance for SFC-licensed virtual asset service providers, licensed corporations, registered open-ended fund companies, and authorized funds.
The MoU establishes a framework for information sharing, case referrals, mutual assistance, and coordinated inspections and investigations. This updated agreement supersedes a 2021 MoU between the SFC and the Financial Reporting Council, which was renamed the AFRC in 2022.
SFC Chair Kelvin Wong stated that the expanded cooperation will offer "more comprehensive oversight" across a wider array of entities and activities within Hong Kong's financial landscape. This move aligns with Hong Kong's ongoing efforts to develop its digital asset regulatory framework, following recent plans for new rules on crypto advisory services and existing frameworks for virtual asset margin financing and perpetual contracts.