Hong Kong Regulations

SECURITIES AND FUTURES (CLIENT MONEY) RULES - SECT 8

Requirements in respect of a client's standing authority

(1) For the purposes of section 4(4)(d) or 5(1)(c), a standing  authority is a
written notice that-

   (a)  is given to a licensed corporation or an associated entity of a
        licensed corporation by a client of the licensed corporation;

   (b)  authorizes the licensed corporation or associated entity to deal with
        client money from time to time-

        (i)    received from or on behalf of; or

        (ii)   held on behalf of, the client, in one or more specified ways;

   (c)  subject to subsection (2), specifies a period not exceeding 12 months
        during which it is valid; and

   (d)  specifies the manner in which it may be revoked.

(2) Subsection (1)(c) shall not apply to a standing authority which is given
to a licensed corporation or an associated entity of a licensed corporation by
a client of the licensed corporation who is a professional investor.

(3) A standing authority which is not revoked prior to its expiry-

   (a)  may be renewed for one or more further periods-

        (i)    not exceeding 12 months, if the client of the licensed
               corporation who gave it is not a professional investor; or

        (ii)   of any duration, if the client of the licensed corporation who
               gave it is a professional investor, at any one time, with the
               written consent of the client of the licensed corporation who
               gave it; or

   (b)  shall be deemed to have been renewed if-

        (i)    at least 14 days prior to the expiry of the standing authority,
               the licensed corporation or associated entity to which it was
               given, gives a written notice to the client of the licensed
               corporation who gave the standing authority, reminding the
               client of its impending expiry, and informing the client that
               unless the client objects, it will be renewed upon expiry upon
               the same terms and conditions as specified in the
               standing authority and for- (A) an equivalent period to that
               specified in the standing  authority; (B) any period not
               exceeding 12 months specified by the licensed corporation or
               associated entity, if the client of the licensed corporation is
               not a professional investor; or (C) a period of any duration
               specified by the licensed corporation or associated entity, if
               the client of the licensed corporation is a professional
               investor; and

        (ii)   the client does not object to the renewal of the standing 
               authority before its expiry.

(4) Where a standing authority is deemed to have been renewed in accordance
with subsection (3)(b), the licensed corporation or associated entity (as the
case may be) shall give a written confirmation of the renewal of the
standing authority to the client of the licensed corporation within one week
after the date of expiry.