What we do

Fund management

Charltons provides high impact advice to clients on all aspects of the fund management business, including establishment of fund management operations, regulatory licensing and compliance matters, fund formation and promotion, and management, trading and investment of fund assets. We also have particular experience in advising on listing Chapter 21 funds on the Hong Kong Stock Exchange.

Our fund management clients range from global fund managers, to smaller start-up managers. The fund managers represented by us manage funds across the full spectrum of asset classes, including listed stocks, fixed income and derivative securities, property, infrastructure, natural resources, emerging market private equity and venture capital, hedge funds and distressed debt.

We help fund management clients set up and structure their businesses in Hong Kong and assist in the preparation of shareholder and employment agreements. We advise on the types of regulated activities that require licensing by the Securities and Futures Commission (SFC) under the Hong Kong Securities and Futures Ordinance (SFO) and related exemptions. We also assist fund management clients in applying for SFC licences and complying with on-going obligations as licensed corporations.

We help both local and international fund managers to structure and launch investment funds. We will advise on the applicable regulatory framework and suggest structures, selling restrictions and other solutions that will enable funds and fund managers to avoid SFO authorisation and prospectus registration if appropriate. We will negotiate fund terms with anchor investors, prepare information memoranda and subscription agreements, draft and negotiate custodian, administration, prime broker and other third party service agreements, and prepare corporate resolutions and other launch documents. We will also draft the investment management agreement between the fund manager and the fund. Where an offshore structure is used, we will engage and instruct offshore counsel and coordinate multi-jurisdictional legal advice to offer a single point of contact and integrated legal solutions to the client.

After fund launch we offer fund managers a full range of services covering all aspects of fund operations, including amendments to fund documentation (for example, a change in investment strategy) and additional investor subscriptions. Our downstream practice also includes transactional work as funds commence investment activities (such as M&A involving portfolio companies and financing rounds for portfolio companies), advice on redemptions and transfers of fund interests, fund restructuring, exits (including sales and initial public offerings of portfolio companies), advice on loan facilities (including revolving credit facilities and margin financing) and regulatory matters. We can also guide fund managers through the disclosure of interests regime under the SFO and related SFC and Hong Kong Stock Exchange filings.

In addition to helping to establish mainstream fund structures, we also have significant knowledge and experience in advising fund management clients on the creation of bespoke products, and drafting and negotiating managed account agreements for separately managed accounts with particular investors.

In cooperation with Boase Cohen & Collins, Charltons can assist fund management clients in relation to SFC investigations, enforcement and disciplinary matters. Our experience includes advising SFC licensed corporations on misconduct by employees and advising financial intermediaries on potential unauthorized selling of investment products and carrying on “regulated activities” without proper licensing.

Fund management

Asset management is a regulated activity in Hong Kong and is subject to the regulation of the Securities and Futures Ordinance. Fund managers have to obtain a type 9 (asset management) licence from the Securities and Futures Commission (SFC) before commencing any asset management activities in Hong Kong. An entity is not required to obtain a type 9 licence if the relevant asset management services are provided to its holding company which holds all its issued shares, or the wholly owned subsidiaries of that holding company, or the entity’s wholly owned subsidiary, and that the relevant services provided to such group companies are not client assets (i.e. needs to be the own assets of the group companies).

Fund management

Listing chapter 21 funds


Hong Kong Securities and Futures Commission SFC

Listing chapter 21 funds on the Hong Kong Stock Exchange

SFC Hong Kong

Hong Kong fund management legal advice

Hong Kong Securities and Futures Ordinance SFO

Hong Kong Downstream practice

Hong Kong Stock Exchange filings

SFC investigations enforcement and disciplinary matters

Hong Kong asset management
Type 9 asset management licence
Unit Trust Fund Listings
Fund management charges