Hong Kong

The Hong Kong Stock Exchange (“HKEx”) concluded a major consultation and implemented, effective from 4 August 2025 (the “implementation date”), a series of reforms aimed at optimising IPO price discovery and open market requirements. HKEx is also seeking public views on public float proposals. Major changes The listing rule changes apply to all existing listed companies and new applicants with prospectuses published on or after 4 August 2025. Public float. Each Hong Kong listed company and new listing applicant must maintain an “open market” for their listed securities. Thus, HKEx requires a minimum percentage of listed securities to be held by the public (public float), i.e. not held by the listed company’s core connected persons (e.g. holders of 10% of more shareholding, directors and their close associates) and not financed by the listed group or any core connected person. Before the implementation date, the public float is 25% of the total number of issued shares, or 15% to 25% if the expected market capitalisation is over HKD10 billion at listing. From the implementation date onwards: For companies with a single class of shares or PRC companies without other listed shares, the public float requirement is 25% if the market value of all listed securities is HKD6 billion or less. If the market value is more than HKD6 billion up to HKD30 billion, the public float must be the higher of (i) the percentage that would result in the market value of listed securities in public hands to be HKD1.5 billion at time of listing, and (ii) 15%. For market value of above HKD30 billion, the public float must be the higher of (i) the percentage that would result in the market value of listed securities in public hands to be HKD4.5 billion at time of listing, and (ii) 10%. HKEx may permit a lower public float, on a case-by-case basis, if the market value significantly exceeds HKD45 billion. For PRC companies with other listed shares (e.g. A shares listed on a mainland stock exchange), H shares in public float must be 10% or is of at least HKD3 billion in market value at listing. Free float. To foster the open market requirement, HKEx introduces a new concept of “free float” effective from the implementation date. It refers to securities available for trading upon listing, and normally means the securities held by the public and not subject to disposal restrictions. For listed companies with a single class of shares or PRC companies with no other listed shares, the listed shares in free float must (i) be at least 10% of the total issued shares listed on HKEx with market value at listing of at least HKD50 million for Main Board and HKD15 million for GEM, or (ii) have a market value of not less than HKD600 million at listing. For PRC companies with other listed shares, the H shares in free float must (i) be at least 5% of the total issued shares in the class to which H shares belong (usually meaning H shares and A shares together) with market value at listing of at least HKD50 million for Main Board and HKD15 million for GEM, or (ii) have a market value of not less than HKD600 million at listing. IPO offering mechanism. At least 40% of the offered shares must be allocated to investors in the placing tranche (other than cornerstone investors). In respect of the public subscription tranche, the IPO applicant may select: an initial 5% of offered shares allocated to the public subscription tranche (if demand in that tranche reaches 15 times but is less than 50 times, the allocation increases to 15%; if demand reaches 50 times but is less than 100 times, it rises to 25%; and if demand hits 100 times or more, the allocation must increase to 35%); or a minimum initial allocation of 10% and a maximum of 60% of the offered shares to the public subscription tranche with no clawback mechanism. Further consultation HKEx is seeking public views on ongoing public float issues. HKEx proposes that all listed companies be subject to a more flexible ongoing public float requirement. Apart from the above-mentioned public float percentages that took effect on the implementation date, the public float requirement can also be satisfied if shares in public hands (i) have a market value of at least HKD1 billion and (ii) represent at least 10% of the total number of issued shares of the same class as HK listed shares (or, for a PRC company with other listed shares, 5% of the PRC company’s total number of issued shares in the class to which H shares belong). All listed issuers will have to confirm compliance with their ongoing public float thresholds in their monthly returns and annual reports. A listed company which fails to meet the public float requirement will not be required to suspend trading of its shares, but must make announcements on such breach, its plan to restore public float and status of such restoration plan. A situation will be classified as a “significant public float shortfall” if (i) the public float falls below 15% or, where a lower initial public float threshold is permitted at listing, below 50% of that threshold and (ii) the market value of public float shares is less than HKD500 million or represents under 5% of the issuer’s total issued shares in the class of the listed shares. In such cases, the HKEX will impose a special stock marker on the listed securities, and the issuer will be required to make additional disclosures. If the company with a significant public float shortfall fails to restore its public float within 18 months for Main Board (or 12 months for GEM), it will be delisted. Rossana Chu is a partner at YYC Legal [email protected]

As Hong Kong works towards becoming a more inclusive society, initiatives like The Ability Bridges play a crucial role in ensuring that legal protection and knowledge are accessible to all members of the community. Through this comprehensive approach, Hugill & II and its partners are not just providing services – they’re building bridges to a more equitable future. In a significant move towards inclusive legal services, Hugill & Ip has launched “The Ability Bridges”, a six-month corporate social responsibility campaign designed to address critical legal needs within Hong Kong’s disability community. The initiative, launching on the United Nations International Day of Persons with Disabilities (3 December 2025), represents a coordinated response to the complex challenges faced by individuals with disabilities and their families. Global context and local challenges The campaign launches against a backdrop of pressing global disability issues. According to recent World Health Organization data, approximately 1.3 billion people – or 1 in 6 people globally – experience significant disability. More alarmingly, persons with disabilities face considerably shorter life expectancies, with some dying up to 20 years earlier than those without disabilities. They also experience twice the risk of developing conditions such as depression, asthma, diabetes, stroke-risk, and obesity. In Hong Kong, the landscape presents its own unique challenges. The Census and Statistics Department’s 2023 Special Topics Report revealed that 534,200 people, representing 7.1% of the city’s population, live with disabilities. Under broader definitions, this number increases to 866,500 people (11.6% of the population). Employment remains a critical issue, with only 40% of working-age persons with disabilities being economically active, highlighting significant barriers to workplace inclusion. A collaborative framework Ability Bridges brings together three prominent NGOs – Love 21 Foundation, The Nesbitt Centre, and Sensational Foundation – in a unique collaborative model. The campaign operates through four strategic pillars: The Justice Bridge: Providing direct pro bono legal representation and advice The Knowledge Bridge: Delivering accessible legal education to families and employers The Support Bridge: Training NGO workers in legal issue identification The Future Bridge: Facilitating future planning through an innovative fundraising model “What makes this campaign unique is its holistic approach,” explains Adam Hugill, Partner at Hugill & Ip. “We’re not just offering legal services; we’re building a sustainable ecosystem of support that will continue benefiting the community long after the campaign ends.” Innovative fundraising model The campaign introduces a groundbreaking “Secure a Future” fundraising initiative. Donors contributing HK$8,000 or more to partner NGOs receive complimentary legal services, including Will drafting (HK$12,000 for Mirror Wills), Enduring Power of Attorney (HK$6,000), or Deed of Guardianship (HK$4,000). This model ensures that 100% of donations directly support NGO programs while providing essential legal planning services to donors. Campaign milestones and activities The six-month campaign features several key initiatives. The campaign addresses critical challenges facing Hong Kong’s disability community through three strategic phases. Beginning with several legal workshops on estate planning, the initiative progresses to comprehensive training sessions and educational resources for families and NGO staff. The final phase delivers workplace inclusion programs and community legal clinics, while tackling fundamental issues such as inadequate legal planning, limited rights awareness, restricted access to services, and employment discrimination barriers. All activities support the campaign’s core mission of building a more inclusive and legally empowered community. “The statistics are clear – persons with disabilities face significant barriers in accessing legal services and understanding their rights,” notes Alfred Ip, Partner at Hugill & Ip. “This campaign provides practical solutions while building long-term capacity within the community.” Community impact and future vision The Ability Bridges campaign aims to achieve several measurable outcomes during its six-month run: Handling a significant number of pro bono cases for individuals and families that would not be able to otherwise afford legal representation Training families and individuals through educational workshops Establishing a sustainable framework for ongoing legal support Generating funding for partner NGOs’ programs The campaign’s impact extends beyond immediate legal services. By building knowledge and capacity within NGOs and the broader community, it creates a foundation for long-term change in how legal services are delivered to persons with disabilities. Getting involved Families seeking support can access services through partner NGOs, while legal professionals interested in volunteering and members of the public wishing to contribute can contact the campaign team at [email protected] or +852 2861 1511.

The Hong Kong government has launched a public consultation on enhancements to regulate licensed money lenders. Currently, any entity or person carrying on a business as a money lender in Hong Kong must obtain a money lender’s licence. The licensing of money lenders and regulation of money-lending activities are governed by the Money Lenders Ordinance (Chapter 163 of the Laws of Hong Kong) and implemented by the Licensing Court, the Companies Registry (CR) and the Police, each playing different roles and functions within the money lenders regulatory regime. In recent years, the community has become increasingly concerned about excessive personal borrowing, especially by foreign domestic helpers (FDHs) and other low-income earners. Statistics reveal that unsecured personal loans granted by licensed money lenders reached a high level of 9.3% in 2024. Larger money lenders reflected that the default rate for borrowers with monthly income of HKD10,000 or less was 9.4%, and the rate for FDHs was 9.9% in 2023. The Hong Kong government is proposing the following measures, which mainly focus on unsecured personal loans: Enhancing regulation of unsecured person loans It is proposed that a cap be set on (a) the aggregate amount of unsecured personal loans or (b) the “debt servicing ratio”. If the borrower’s monthly income is HKD5,000 or less, (a) the aggregate unsecured personal loan cap is one month’s income and (b) the “debt servicing ratio” cap is 35%.  Where the monthly income is between HKD5,001 and HKD10,000, (a) the aggregate unsecured personal loan cap is two months’ income and (b) the “debt servicing ratio” cap is 40%. For example, if a borrower’s monthly income is HKD5,000, his debt servicing amount is capped at HKD1,750 (35% of HKD5,000). If he takes a personal loan with an annual interest rate of 30% to be repaid in 12 monthly instalments, then the maximum principal amount will be HKD18,000. Further, to prevent situations where borrowers take large loans before disappearing when their employment contracts end, the government proposes that repayment periods for unsecured personal loans shall not exceed the remaining term of the borrowers’ employment contracts. Strengthening protection of public interest Under the current regime, an intending borrower may provide a referee to the money lender if the referee has given written consent to act in respect of the loan application. The role of a referee is confined to the provision of information about an intending borrower, and the referee should not be required to repay the loan. Yet, employers of certain defaulting borrowers, including those employing FDHs who reside with them, and non-debtors are harassed by money lenders and debt collectors, causing social problems. To further protect public interest, including the interests of FDH employers, the government proposes that when borrowers provide referees in their loan applications, money lenders must proactively send a letter to the referee to verify the authenticity of the written consent, or else, the referee must sign the written consent in person at the money lender’s premises. As an alternative, the government proposes prohibiting money lenders from requiring borrowers to provide referees when applying for unsecured personal loans. Optimising the borrower affordability assessment The “Credit Data Smart” (CDS) was introduced in April 2024 by the Hong Kong Monetary Authority together with industry associations of banks, money lenders and deposit-taking companies. The CDS enhances protection of consumer credit data and also provides more choices of consumer credit reference service providers.  As in May 2025, 36 money lenders (accounting for about 64% of the loan business of all licensed money lenders) have joined the CDS. The government proposes to require all licensed money lenders to regularly submit personal credit information of their borrowers to the CDS, including loan applications, terms of approved loans and repayment records, to complete the database of the CDS. It also proposes requiring money lenders with a certain scale of unsecured personal loan business to, before approving loans, assess the affordability of intending borrowers based on their personal credit reports under the CDS, in order to enhance their application assessments. Enhancing complaint handling process The government will mandate the CR to enhance the transparency in handling complaints against money lenders and to strengthen communication and exchange of intelligence with the Police. Also, the CR is expected to reinforce the system for supervising money lenders in handling complaints. It is to regularly collect and analyse statistics from money lenders on complaints received by them. It will also monitor whether money lenders with persistently high complaint figures have established procedures to ensure proper handling of customer complaints, to take appropriate remedial actions and to ensure their employees and agents can provide complainants with correct information. Stepping up publicity and education The Government will increase awareness and education targeting FDH communities, young people, and low-income earners to help them better understand the risks of excessive borrowing. To spread the messages effectively, the campaign will use multiple languages and different methods, and the messages will also be conveyed by the Labour Department, the Investor and Financial Education Council, and non-governmental organisations. For FDHs in particular, the government will remind them not to use their employers as loan referees or give their employers’ home addresses as their own contact details when applying for personal loans. It will provide more accessible channels for FDH employers to report money lenders that violate licensing conditions. Enhancing money lender regulatory regime The government proposes the licensing and supervision of money lenders should be handled centrally by a government department (i.e. CR), including reviewing and approving applications, monitoring compliance and prosecuting violations. Details of money lenders with repeated offences will be published on the government’s website for public reference. These measures will require amendments of relevant provisions of the Money Lenders Ordinance. Rossana Chu is a partner and Beverly Fu is an associate at YYC Legal [email protected] [email protected]

Hugill & Ip, renowned for its comprehensive corporate, family and private client services, is pleased to announce the appointment of Polly Chu as Partner, effective mid-October 2025. Polly Chu’s arrival marks the strategic launch of the firm’s dedicated Real Estate and Conveyancing practice, significantly enhancing Hugill & Ip’s ability to provide seamless, end-to-end legal solutions for both corporate entities and private individuals navigating Hong Kong’s property market. Polly Chu is a highly respected practitioner with over two decades of experience in all aspects of Hong Kong property law. Her expertise spans residential and commercial conveyancing, leasing, property financing (including mortgages and refinancing), and handling complex property-related disputes. Her appointment underscores Hugill & Ip’s commitment to expanding its core service offerings in response to growing client demand for integrated legal support across their most valuable assets. In her new role, Polly will lead the development of the new practice area, focusing on streamlining property transactions, providing robust due diligence for commercial acquisitions, and advising on complex land matters in the context of wealth management and corporate restructuring. Strategic expansion and partner commentary The addition of the Real Estate and Conveyancing practice is a strategic move designed to integrate property expertise directly into the firm’s existing strengths in litigation, private client, and corporate law. Caroline McNally commented on the strategic advantage Polly Chu brings to dispute resolution: "Polly’s expertise is a vital addition. In complex commercial and family disputes, property assets are frequently central. Whether it involves enforcing a contract for sale, managing landlord-tenant litigation, or dealing with adverse possession claims, her ability to provide immediate, precise real estate advice will significantly strengthen our advisory and litigation strategies. This ensures our clients receive seamless, end-to-end solutions, whether they are buying, selling, or fighting to protect their assets. Her presence allows us to manage property-related risks proactively from the outset of any dispute." Alfred Ip highlighted the importance of real estate expertise for private clients and wealth management: "For our private clients, real estate often forms the cornerstone of their wealth and estate planning, whether it’s a family home or an investment portfolio. Polly’s deep knowledge of Hong Kong conveyancing procedures allows us to integrate property structuring flawlessly into our trust and succession planning services. This ensures generational wealth transfer is handled efficiently, securely, and in full compliance with complex land registration requirements. This expansion is essential for holistic private client care, safeguarding our clients' most valuable physical assets." Adam Hugill emphasised the benefit to the firm’s client base: "The launch of the Real Estate practice is a game-changer for many of our clients, who require swift and accurate advice when dealing with property. Whether they are disposing of matrimonial properties, conducting property due diligence for M&A transactions, or managing large-scale corporate relocations, Polly provides the necessary specialist insight. This integration allows us to offer a truly comprehensive service, managing both the corporate structure and the underlying assets with expert precision." About Polly Chu Polly Chu holds extensive experience advising high-net-worth individuals, property developers, and institutional investors on diverse property portfolios. She is known for her meticulous attention to detail and her ability to navigate the complex regulatory environment of Hong Kong’s land and property laws. Polly is dedicated to providing practical, commercially sensible advice that achieves client objectives efficiently.