1. Type 2 License (Futures Contract Trading) Statutory Business Scope
Index and commodity futures trading
Provide customers with Hang Seng Index、Global stock index futures、and various commodities (such as gold、crude、Agricultural products, etc.) trading and execution services of futures contracts。
Futures Brokerage Services
Providing brokerage and clearing services for futures contracts to clients as an agent，Accept orders from customers，And hold or manage futures trading margin on your behalf。
Principal trading and market making
Obtain or dispose of futures contracts as principal，or enter into an agreement with a counterparty，Providing liquidity to certain derivatives markets。
Bitcoin and virtual asset futures
According to SFC guidelines，Bitcoin futures traded on traditional exchanges are regulated by the Securities and Futures Ordinance，To operate relevant businesses, you must apply for a Type 2 regulated activity license。
2. Core statutory [conditions] for applying for SFC No. 2 license
1. Qualifications of legal entities：The company entity must be a limited company incorporated in Hong Kong，Or an overseas foreign company that has been legally registered with the Hong Kong Companies Registry。
2. Responsible person (RO) Configuration：The corporation must appoint at least two Responsible Officers (ROs) to directly supervise the business。RO needs to hold relevant industry qualification certificates，Or have at least five years of practical experience in the relevant industry。
3. Suitable candidates for senior management (Fit & Proper)：directors of corporation、Major shareholders and core management must be in good standing，Have the financial status and soundness to fulfill obligations，And no bad history such as money laundering or financial fraud。
4. Business structure and risk control：The company's business structure must be good，Have a sound internal control system，Be able to reasonably and effectively deal with high leverage risks and crises in the futures business operation process。
3. Statutory [capital threshold] for applying for No. 2 license
| Institutional business types and restrictions | Minimum paid-up share capital (Paid-up Capital) | minimum working capital (Liquid Capital) |
|---|---|---|
| Approved introducing agent、traders、Futures non-cleared dealer | not applicable (No hard capital injection requirements) | $500,000 Hong Kong dollar |
| Other situations (futures merchants who can generally hold client assets) | $5,000,000 Hong Kong dollar | $3,000,000 Hong Kong dollar |
Note：The above are the minimum requirements set by the Securities and Futures (Financial Resources) Rules。In actual operation，It is recommended to reserve sufficient working capital to cope with the SFC’s first half-year expenditure forecast review。
4. Dual-track statutory [process] for obtaining No. 2 license
[Path A] Apply directly to SFC for a license (The period is approx. 6-8 months)
1. Conditional supplement：Ensure RO candidate、The registered capital and Hong Kong company structure are in compliance with regulations。
2. Submit materials：Submit detailed copy related to application conditions (including business plan、risk control plan, etc.) to the acceptance department。
3. review stage：SFC focuses on the financial situation of enterprises、Personnel qualifications、Conduct multiple rounds of reviews and inquiries on credibility and soundness of contract performance.。
4. License issuance：After fully meeting the conditions，SFC officially issued license No. 2。
[Path B] Direct merger and acquisition of licensed companies (The period is approx. 3-6 months)
1. Prepare materials：The buyer prepares shareholder and financial application materials that meet the requirements of "fit and proper person"。
2. SFC major shareholder change review：Submit materials to SFC，Officials mainly examine the personnel background of new shareholders、financial situation、Ability and stability to perform obligations。
3. Licensing and subsequent responsibilities：After merger approval and licensing completion，Corporations must continue to fulfill compliance obligations，Including submitting the "Financial Resources Declaration Form" on time every month(FRR)。
5. Hong Kong Huitong’s one-stop service and [fees included]
Assistance in direct application for license services
1. Assist in handling directors’ compliance corrections；
2. Write a rigorous business plan、Operation plan and compliance plan；
3. Prepare a full set of statutory application materials；
4. Writing daily operational countermeasures for the Anti-Money Laundering and Counter-Terrorist Organization Financing Regulations；
5. Responsible for responding to all written inquiries raised by regulatory authorities；
6. If SFC needs additional copywriting or explanations，Fully responsible for writing and submitting。
Assist in the acquisition of existing license services
1. With the help of Hong Kong Huitong’s powerful platform，Search and screen suitable target companies based on requirements；
2. Preliminary review to ensure that the target is in compliance with anti-money laundering、Clean on debt and regulations；
3. Connect with resources to arrange interviews and draft MOU；
4. Arrange for lawyers to perform due diligence(DD)and audit accounting；
5. Preparing the final equity purchase and sale agreement(SPA)；
6. Complete regulatory approval filing；
7. Assistance with taxes、Bank Account and Registry Transfer。
6. Key licensing [exemption] situations under the Securities and Futures Ordinance
incidental exemption (Incidental Exemption)：If the corporation has made an application for Category 2(Futures trading)licensed，and proposed Category 5(Provide advice on futures)and Category 9(asset Management)The activity is entirely incidental to its futures trading business，There is no need to obtain additional license plates No. 5 and No. 9。
Professional investor exemption (PI Exemption)：If you are acting in a principal capacity，Futures contracts traded on non-recognized futures markets，Only with "professional investors" defined in Schedule 1 of the Regulations(PI)Make a transaction，Can be exempted from licensing。
Group member exemption (Intra-Group)：If purely to your wholly owned subsidiary、Wholly-owned parent company provides futures trading advice or services related to regulated activities，Exemption from application for Type 5 and Type 9 licenses。
authorized financial institution (AFI) Registration mechanism：Banks and other authorized financial institutions engage in Type 2 futures business，No need to "get a license" from SFC，However, it must be submitted to the Hong Kong Monetary Authority(HKMA)Register and become a "registered institution" of SFC。
7. Hong Kong No. 2 Financial License Core Legal Questions and Answers (FAQ)
Type 2 license is the "futures contract trading" license，Allow licensed corporations to provide index futures to customers、Commodity futures trading and brokerage services，or enter into as principal、Acquire or dispose of futures contracts。
The core conditions include：The subject is Hong Kong or a registered offshore company、Meet the minimum capital threshold (usually 5 million equity + 3 million liquid capital)、Appoint at least 2 Responsible Officers (ROs) with 5 years of experience，And establish a good business structure and risk control system。
Approved introducing agents and non-settlement dealers do not touch client funds，Therefore no minimum paid-up share capital is required，Only need to maintain working capital of HK$500,000。General futures merchants need to meet the paid-up capital of HK$5 million and working capital of HK$3 million.。
Yes。According to SFC guidelines，Bitcoin futures traded on traditional exchanges and subject to their rules are considered “futures contracts” under the Securities and Futures Ordinance。therefore，To operate this type of business, you must apply for a No. 2 license。
Usually not required。According to the "incidental immunity" clause，If your proposed No. 5 license business (providing investment advice) is completely incidental to your No. 2 license futures brokerage business，You are exempted from applying for No. 5 plate。
The direct application process includes：Conditions Supplement (Ready RO/Funding/Structure) -> Submit a full set of commercial and compliance materials -> SFC from Finance、Qualifications、Conduct multiple rounds of written inquiries and reviews from multiple dimensions including credibility -> final deal。Full appointment required 6 to 8 months。
The merger and acquisition process includes：Target screening and due diligence(DD) -> Drafting MOU and SPA -> Submit major shareholder change materials to SFC (focus on inspecting the buyer’s personnel、financial strength and soundness) -> Approval and delivery。As soon as 3 to 6 months to complete。
Hong Kong Huitong’s license application service fee includes：Assist directors with compliance corrections、Write business plan/operation plan/anti-money laundering(AML)Operation plan、Prepare all legal materials，He also had full authority to respond to multiple rounds of tricky written inquiries from SFC.。
M&A services covered：Match target、Preliminary troubleshooting(Money Laundering/Debt Imperfections)、Arrange sales and purchase negotiations、Appoint lawyers to perform in-depth due diligence(DD)and financial audit、Drafting a SPA Purchase and Sale Agreement、Complete SFC approval filing and tax bank transfer。
Can be exempted，But the conditions are extremely strict：You must act as "Principal"，Futures contracts traded on “non-recognized futures markets” (i.e. not Hong Kong Futures Exchange)，and only conduct transactions with professional investors defined in Schedule 1 of the Regulations。
SFC will strictly investigate corporate major shareholders、Directors and Responsible Officers：financial soundness、Educational qualifications and relevant industry experience、Reputation, character and reliability。Applicants with past bad records such as financial fraud or money laundering will be directly rejected.。
At least 2 ROs are required。They must hold relevant industry qualifications，Or have at least five years of relevant industry experience。At least one of them must be an executive director of the corporation，And at least one person needs to stay in Hong Kong at all times to supervise the business。
No need to "deal"，But you must "register"。Banks and other institutions are regulated by the Hong Kong Monetary Authority (HKMA)，When engaging in Category 2 activities, you need to become a "registered institution" of SFC in accordance with the law.，Its key personnel must be listed in the HKMA’s register。
In addition to having sufficient working capital for the first six months of business, the corporation must，During the entire operating cycle after being licensed，A Financial Resources Declaration Form must be submitted to the Securities and Futures Commission every month(FRR)，Ensure that liquid capital does not fall below the legal red line。
Must be licensed。According to Section 115 of the Securities and Futures Ordinance，Any person (whether in Hong Kong or overseas) who “actively promotes” services that constitute regulated activities to the public in Hong Kong，subject to legal regulation，Must apply for corresponding license。
