1. Type 4 License (Advising on Securities) Statutory Business Functions
Provide securities investment advice
for individual investors、Institutional clients or other financial intermediaries provide relevant securities (such as stocks、bond、ETF、Security tokens, etc.) buy、Sell or hold investment opinions and market trend strategies。
Write and distribute research reports
Produce and publish securities-related analysis reports (such as stock research、bond ratings or market analysis)，for customers、Public or institutional references to support investment decisions (such as issuing a "buy" or "sell" rating)。
Portfolio and Strategy Consulting
Based on the client’s risk tolerance and financial goals，Provide securities portfolio construction、Management or optimization suggestions，Covers asset allocation、Risk management and long-term investment planning。
virtual assets (VA) Consulting function
If a virtual asset is recognized as a “security token”，No. 4 is allowed to provide its investment advice and portfolio design；Suggestions on non-securities virtual assets (such as Bitcoin) are not within the scope of No. 4 license，Governed by other VASP frameworks。
2. Core statutory qualification requirements for applying for Type 4 license
fit and proper person (Fit and Proper)：Company and its major shareholders、director、RO needs to prove financial status (no bankruptcy or major financial problems)，No criminal record or violation of financial regulations，And have professional operational capabilities。
Company establishment and actual operations：The applicant company must be incorporated in Hong Kong (such as a limited company) or be a registered overseas company。Need to have actual business operations (set up an office、Hire local staff)，Demonstrate that business activities are genuine and ongoing。
Responsible person (RO) appoint：Appoint at least two ROs to oversee regulated activities，At least one executive director shall be resident in Hong Kong。RO needs to have at least 3 years of industry experience (including 2 years of management experience)，And pass the HKSI exam (Paper 1 and 6) or be exempted。
Compliance and Internal Controls：A complete anti-money laundering system needs to be established(AML)Get to know customers(KYC)program；Submit compliance manual to manage conflicts of interest and client data protection；Develop risk management policies and appoint independent auditors。
Detailed business plan：A business plan describing the scope of activities must be submitted、Target customer group、revenue model。If securities virtual assets are involved，Business model and compliance measures need to be clarified，and demonstrate having the analytical tools or technical systems to support the business。
3. Securities and Futures (Financial Resources) Rules Capital Requirements and Official Fees
| Institutional business conditions restrictions | Minimum paid-up share capital (Paid-up Capital) | Minimum working capital (Liquid Capital) |
|---|---|---|
| Subject to the condition "not to hold client assets" | not applicable (No hard requirements) | $100,000 Hong Kong dollar |
| Other situations (customer assets can be held) | $5,000,000 Hong Kong dollar | $3,000,000 Hong Kong dollar |
| Securities and Futures Commission official license application fee | The application fee is approximately HK$4,740 (to be paid through the WINGS system)；Annual license fee is approximately HK$4,290 | |
Note on legal restrictions：4Number plates are only allowed to provide opinions，Excludes execution of securities transactions (requires No. 1 license)、Corporate financing advice (requires No. 6 license) or direct management of client funds/investment portfolios (requires No. 9 license)。
4. Licensing exemptions under the Securities and Futures Ordinance
incidental exemption：If Category 1 has been issued(Securities trading)or category 9(asset Management)license，And the securities advice provided is entirely incidental to the securities trading business or the portfolio management of collective investment schemes.，There is no need to obtain another No. 4 license plate。
Group member companies exempt：Purely a wholly owned subsidiary、A holding company that holds all of the issued shares or another wholly-owned subsidiary of such holding company provides securities opinions for its own use，exempt。
Professional exemption：lawyer、Securities advice provided by a barrister or professional accountant is entirely incidental to the scope of their professional practice，Can be exempted from licensing。
Exemption for broadcasters/journalists：through newspapers generally available to the public、Magazine、books，or television/radio broadcasts intended for public reception providing securities opinions or analysis，No license required。
trust company exemption：as a registered trust company，If the investment advice provided is entirely incidental to the performance of the duties of a registered trust company，Can be exempted from licensing。
5. Dual-track statutory procedures for obtaining No. 4 license：Direct application vs target acquisition
[Path A] Apply directly to the China Securities Regulatory Commission (The total cycle is approx. 6-12 months)
1. preparation stage (2-6months)：Set up a company，Appoint RO and pass HKSI exam(Paper 1 & 6)，Write compliance manual and business plan。
2. Submission and preliminary review (1-2week)：Submit Form A and financial statements through WINGS system，SFC checks file integrity。
3. Detailed review (2-4months)：SFC assesses ‘fit and proper person’ qualifications、Compliance framework，and may require a background check(2-8week)and interview clarification。
4. final approval (1-2week)：Issue approval notice，Pay annual license fee，License officially takes effect，Start CPT training。
[Path B] Acquisition of Targets by Licensed Corporations (The total cycle is approx. 4-12 months)
1. Preliminary preparation (1-3months)：Screen for No. 4 companies with clean compliance records，conduct finance、Legal and Compliance Due Diligence(DD)，Sign a letter of intent(LOI)。
2. trade execution (1-2months)：Negotiate price and sign SPA，Complete funding approval，Prepare SFC change information。
3. SFC approves change of major shareholder (2-4months)：Submit change request，SFC assesses new shareholder’s “fit and proper” status，Respond to regulatory requests。
4. Follow-up compliance and operations (2weeks to 2 months)：Integrate customer base and systems，Update internal compliance policies，Officially launched consulting services。
6. Core risks and challenges in No. 4 license application and acquisition
RO Eligibility and Resignation Risk：If the RO qualification is insufficient (failed to pass the exam) when applying, it will be delayed by 1-3 months.。If the original RO is unwilling to stay during the acquisition，A new RO needs to be re-appointed，Add 1-2 months transition period。
virtual assets(VA)Risk of misclassification：Mistakenly including Bitcoin and other "non-security virtual assets" into No. 4 license business will face illegal rectification。Lawyers must be hired to strictly distinguish asset types。
Hidden liabilities and compliance issues in acquisition targets：The target company may have undisclosed financial liabilities，or face pending regulatory penalties for failure to comply with the latest VA guidance。Thorough due diligence must be performed(DD)。
Insufficient response to SFC emergency inspection：The SFC may require on-site interviews during the approval process。If the RO cannot clearly explain the business model or the compliance manual is incomplete，This will result in serious delays in approval or even rejection.。
7. Hong Kong Huitong’s one-stop legal and compliance agency service
Comprehensive application agency
Assist in handling directors’ compliance corrections；Tailor-made business plan、Operational plan and daily operation plan for AML/CFT anti-money laundering regulations；Fully authorized agent to answer multiple rounds of written inquiries from regulatory authorities。
Target screening and due diligence(DD)
Use Ganghuitong’s powerful resource network to screen clean No. 4 companies；Arrange for lawyers to enforce strict compliance、Debt and regulatory due diligence and audit accounting。
M&A closing and transfer
Assist in connecting resources and arranging interviews，Drafting MOU and final SPA agreement；Complete SFC regulatory approval filing，and tax、Smooth transfer of bank account。
8. Hong Kong No. 4 Financial License Core Legal Questions and Answers (FAQ)
Type 4 license regulates the activity of “advising on securities”。Licensed institutions can provide customers with buy-in、Investment advice to sell or hold specific securities，Publish securities research reports，and provide investment portfolio and strategy consulting。
If the corporation has made a provision for Category 1(Securities trading)or category 9(asset Management)licensed，And the securities investment advice it provides is completely incidental to its securities brokerage or asset management business (and no independent fees are charged for the advice)，You will be exempted from applying for a No. 4 license plate separately.。
Protected by the "Group Company Exemption"，If a corporation pays purely to its wholly-owned subsidiary、A parent company or other wholly-owned subsidiary that holds all issued shares provides investment advice for its own use，Can be exempted from licensing。This does not apply to providing advice to clients external to the Group。
At least two ROs need to be appointed to oversee regulated activities，At least one of them must be an executive director and be resident in Hong Kong。RO needs to have at least 3 years of relevant industry experience (including 2 years of management experience)，And pass the HKSI qualification examination (Paper 1 and Paper 6) or be exempted。
If the institution is subject to the licensing condition of “not holding client assets”，The minimum working capital requirement is HKD 100,000 (no minimum paid-up capital requirement)。If there is no such restriction (customer assets can be held)，It requires a paid-up share capital of HK$5 million and working capital of HK$3 million.。
The SFC will strictly scrutinize the company and its major shareholders、Financial soundness of directors and RO (no bankruptcies)、Character and integrity (no criminal record or regulatory penalties) and professional ability (academic qualifications、Industry experience and test scores)。
Only partially covered。If virtual assets are recognized as “securities” under the Securities and Futures Ordinance (such as security tokens)，License No. 4 allows the provision of investment advice；However, non-securities virtual assets (such as Bitcoin) do not fall within the scope of the No. 4 license.，May be governed by the VASP framework。
According to SFC Virtual Asset Guidelines，The licensee needs to ensure that the client is a professional investor (PI，Personal assets of at least HKD 8 million or institutions)，and pass the virtual asset knowledge test。Must use digital tools to keep detailed records of customer finances，Otherwise, you will face severe penalties for violations。
SFC requires licensees to provide clear warnings about volatility risks to clients and document communications，Implement a dynamic risk assessment system，and regularly update market analysis，Ensure investment advice is always appropriate for clients’ risk tolerance。
The target company may have compliance stains due to failure to comply with the latest VA regulatory guidance；also，VA business requires specialized transaction monitoring and data security systems，If the target company’s technical infrastructure is insufficient，Subsequent system integration will take several months。
Major risks include：The target has undisclosed financial liabilities or faces pending regulatory penalties；The original RO is unwilling to stay, resulting in a lack of business (it will take 1-2 months to replace the new RO)；and the mismatch between the target company’s business model and the buyer’s needs.。
The most common barriers include：Insufficient RO qualifications (failure to pass the HKSI exam will result in a delay of 1-3 months)、Incomplete documentation (missing business plan or compliance manual resulting in request for supplement，Extension of approval by 2-4 weeks)，And it is difficult for newly established companies to meet working capital certification requirements。
Will。The CSRC may require RO and management to attend interviews during the approval process。Focus on questioning RO’s practical experience、The viability of the business plan and the completeness of the compliance framework。If you are not well prepared for the mock interview，This will result in serious delays in approval or even rejection.。
This is the virtual asset regulatory roadmap launched by the SFC in February 2025。Although mainly aimed at trading platforms(VATP)and OTC，But it strengthens investor protection(Safeguards)and product innovation(Products)measures，Type 4 licensees will be required to adhere to stricter compliance and infrastructure standards when providing VA advice。
After approval, you need to pay annual license renewal fees and submit audited financial statements.。RO and related employees are required to complete 5-10 hours of continuing professional training (CPT) every year。Any major business changes (such as changes in major shareholders、RO resignation) needs to notify SFC in a timely manner。
