SEC registrants: One of the questions SFC licensees who are also SEC registrants sometimes ask is how to ensure that their internal policies and procedures are “ready” for a possible inspection by different regulators. There is no easy answer to this question. The documents need to be reviewed by lawyers in each relevant jurisdiction to ensure that all the relevant local requirements are covered. Our general approach in terms of how to manage the drafting of a compliance manual for an SFC licensee, with a view to minimising time spent while maintaining consistent high standards across jurisdictions will depend on whether:
The SEC expects a registrant to review its policies and procedures and the effectiveness of their implementation at least annually. Any compliance matters that arose during the year should be documented in a yearly compliance review. According to the SEC's paper earlier this year entitled “Examination Priorities for 2013”, its examination focuses include fraud prevention, corporate governance, technology, safety of assets, conflicts of interest related to compensation arrangements, allocation of investment opportunities and marketing and performance advertising.