Few apply for forex licences
ELEVENTH-hour applications for new foreign-exchange dealers' licences were still being delivered to the Securities and Futures Commission (SFC) last night by the remaining players in Hong Kong's trimmed-down forex industry.
By mid-afternoon, new licence forms had been lodged by about 30 companies, said SFC senior manager for public affairs Bill Weeks. Applications closed at midnight.
The SFC will announce tomorrow the total number and names of companies which have applied for licences under the new Leveraged Foreign Exchange Trading Ordinance.
Between 200 and 300 business were believed to have been offering foreign exchange services before the new regulations were introduced last month.
Most existing operators have been forced out of the market by the minimum $30 million capital requirement under the new licensing rules.
Despite the large reduction in the number of forex companies, Mr Weeks said there would still be enough to ensure a competitive industry.
'The new regulations are designed to ensure that all foreign-exchange dealers have sufficient financial resources, will deal fairly and are fit and proper individuals,' he said.
'Foreign-exchange investors can now go about their business with more confidence. The new legislation was enacted because there was such a high level of abuse and something had to be done to rein it in.' The SFC and police have established a joint operation to detect and close down any unlicensed dealers still in operation.
Investors wanting to know if a particular trader is allowed to remain in business can call the SFC's special forex hotline on 840 9333.