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Hong KongSFC licence types explained: the thirteen regulated activities
The SFC does not issue a general permission to work in finance. It licenses thirteen named regulated activities, numbered Type 1 to Type 13, and you hold a licence only for the ones you were approved for. Type 1 is dealing in securities. Type 9 is asset management.
People say they are "SFC licensed" the way they say they are qualified. The phrase means almost nothing on its own. What matters is which activities you are licensed for, in what capacity, and at which firm, because a Hong Kong licence is narrow by design and it does not travel with you the way a degree does.
What the SFC actually licenses
Part V of the Securities and Futures Ordinance sets out the licensing regime. Under it, carrying on a regulated activity in Hong Kong as a business requires a licence, unless something specific takes you outside the regime. The Ordinance names thirteen of those activities in a schedule, and the numbering has become the working vocabulary of the whole industry. Nobody says "advising on corporate finance" in a meeting. They say Type 6.
| Type | Regulated activity | Who typically holds it |
|---|---|---|
| 1 | Dealing in securities | Brokers, execution desks, retail and institutional securities firms |
| 2 | Dealing in futures contracts | Futures brokers and listed-derivatives execution desks |
| 3 | Leveraged foreign exchange trading | Retail leveraged FX providers |
| 4 | Advising on securities | Research analysts, investment advisers, private bank advisers |
| 5 | Advising on futures contracts | Futures research and advisory desks |
| 6 | Advising on corporate finance | IPO sponsors, corporate finance advisory houses, takeovers advisers |
| 7 | Providing automated trading services | Operators of electronic trading and matching platforms |
| 8 | Securities margin financing | Firms lending money against securities collateral |
| 9 | Asset management | Fund managers and discretionary portfolio managers |
| 10 | Providing credit rating services | Credit rating agencies |
| 11 | Dealing in or advising on OTC derivative products | OTC derivatives desks |
| 12 | Providing client clearing services for OTC derivative transactions | Clearing service providers |
| 13 | Providing depositary services for relevant CIS | Trustees and custodians of authorised funds |
Read that list once and the logic becomes obvious. The Ordinance separates doing the trade from telling somebody what trade to do from managing the money on their behalf. Dealing, advising, managing. Everything else is a specialised carve-out for a business model the regulator wanted to see separately.
Licences stack, and most people hold more than one
There is no rule that says you pick one. A broker that also publishes research will hold Type 1 and Type 4. An asset manager that markets its own funds often carries Type 9 alongside Type 1 or Type 4. A futures desk sitting inside a securities house will have Type 1 and Type 2 on the same corporate licence, with different individuals accredited to each.
This matters to you as a candidate for one blunt reason. Your competence requirement is driven by the activities on your accreditation, not by your job title. Two people with the same business card can face different examination requirements because one of them advises and the other only executes.
Corporation, representative, responsible officer
Three different things get licensed, and confusing them is the single most common misunderstanding among people new to the regime.
- Licensed corporation
- The firm itself. It holds the licence for each regulated activity it carries on.
- Licensed representative
- An individual accredited to a licensed corporation to carry on a regulated activity for it.
- Responsible officer
- A representative additionally approved by the SFC to supervise a regulated activity. Every licensed corporation needs them.
- Registered institution
- A bank supervised by the HKMA that carries on regulated activities under registration rather than a licence.
A representative cannot operate on their own. Your licence is tied to your employer, which is why the industry talks about being "accredited to" a firm. Leave the firm and the accreditation ends. The route through this is covered properly in our note on becoming a licensed representative in Hong Kong.
Where HKSI Paper 1 fits
The SFC will not licence you unless you are fit and proper and competent. Competence has an examination component, and for most applicants that means the HKSI Licensing Examination. Paper 1 is the common gateway: it covers the regulatory framework that applies to everybody regardless of which Type you end up holding. Alongside it you sit a practical paper matched to your activity.
Which practical paper depends on the activity, and the mapping is HKSI's to publish, not ours to guess. We have set out the shape of the requirement in which HKSI papers you actually need and pointed you at the current list. If you want the exam itself first, start with what HKSI Paper 1 covers.
We will not print a Type-to-paper table that we cannot source, because a wrong one costs you an enrolment fee and a month. HKSI publishes the current pairings and the SFC publishes the recognised alternatives. Check both before you enrol.
How to see what somebody actually holds
The SFC runs a free public register of licensed persons and registered institutions. Search a name or a firm and you get the regulated activity types, the accreditation, the responsible officer flag, and any public disciplinary history. It takes about a minute. Use it on a prospective employer before you accept a role - if the firm does not hold the Type the job description implies, you have a problem to raise at interview rather than after you resign.
The opinion, and the concession
Here is what I would tell anyone starting out: learn the thirteen types by heart in the first week, before you touch anything else. It costs you an evening. It pays back constantly, because half of Paper 1's licensing questions and most of the industry conversations you will have for the next decade assume you know them cold, and people who do not know them spend years quietly nodding.
The concession is that the boundaries between types are genuinely fuzzy at the edges. Where advising stops and dealing starts, whether a particular product is a security, when a foreign firm is carrying on business in Hong Kong at all - these are questions that occupy real lawyers and real SFC guidance. The exam tests the clean cases. Your job will hand you the messy ones.
Common questions
How many SFC licence types are there?
Thirteen. They run from Type 1, dealing in securities, through to Type 13, providing depositary services for relevant collective investment schemes. The Securities and Futures Ordinance names them in a schedule, and a firm or individual holds a licence for each one they carry on.
Can one person hold several regulated activity types?
Yes, and it is normal. An individual accredited to a licensed corporation can be licensed for several types at once, provided the firm holds those types and the person meets the competence requirement for each. Adding a type later means an application, not a new licence from scratch.
Is an SFC licence tied to my employer?
For individuals, yes. A licensed representative is accredited to a specific licensed corporation. If you leave, that accreditation ceases and your new employer has to apply to transfer or re-accredit you. The examination passes you hold stay with you personally.
Do I need a licence to work in finance in Hong Kong?
Only if your role involves carrying on a regulated activity as a business. Operations, technology, finance and many middle-office jobs sit outside the regime. The test is what you actually do, not which floor you sit on, so check the activity definitions against your role.
What is the difference between a licence and registration?
Licensed corporations are supervised directly by the SFC. Registered institutions are authorised banks carrying on regulated activities under the Banking Ordinance, with the HKMA as their front-line supervisor and the SFC still setting conduct standards. The individuals inside them are relevant individuals rather than licensed representatives.