Hong Kong Securities and Futures Commission: Progressing as scheduled in preparing for the implementation of a paperless securities market system by early 2026.

The Securities and Futures Commission (SFC) of Hong Kong welcomes the passage of all necessary legislation for the implementation of a paperless securities market. Depending on market readiness, the measures will be implemented in early 2026. In recent consultations and communications conducted by the SFC, market participants widely support the paperless securities market measures. This measure will further enhance the efficiency of the securities market and provide better protection for investors and ease of trading. To help the market better understand the new measures and prepare for them, the SFC has launched a dedicated webpage for the paperless securities market today, providing all relevant information in one place. The webpage includes a series of FAQs to help listed issuers and investors deepen their understanding of their rights and responsibilities in a paperless securities market. Key changes in the paperless securities market include: Newly listed securities will be required to be in paperless form from the time of listing, meaning investors will no longer be able to hold these securities in paper form. As for existing securities, investors can continue to hold their physical share certificates, which will not become obsolete. In the meantime, issuers will be given a specific deadline to take steps to allow investors to hold and transfer their own securities without the need for paper documents. After this deadline, issuers will not be able to issue new physical share certificates. The SFC is working with the Hong Kong Exchanges and Clearing Limited (HKEX) and the Hong Kong Institute of Certified Public Accountants (HKICPA) to develop a detailed five-year implementation timetable covering issuers from Hong Kong, Mainland China, Bermuda, and the Cayman Islands. Mr. Leung Chung-yin, Executive Director of Market Surveillance at the SFC, said, "We encourage issuers to proactively contact their share registrars to discuss feasible timelines for participating in the system. We urge market participants to start preparing for the implementation of the paperless securities market as soon as possible." In the coming months, the SFC will work with HKEX and HKICPA to enhance communication with stakeholders to help them understand the operation, benefits, and impacts of the new system, as well as the next steps they need to take to participate in the new system.