Request for the Consumer Council to Investigate Securities Brokers' Charges in Hong Kong
Release Date: 2023-04-05
April 5, 2023
To: Consumer Council
To: Consumer Council
Request for the Consumer Council to Investigate Securities Brokers' Charges in Hong Kong
As a leading global financial center, Hong Kong's securities industry has undergone significant diversification and continuous improvement. With the global economic and trade developments, Hong Kong has become a hub for various businesses, and the local securities industry has also thrived. However, over the past decade, the rapid technological advancements have brought both positive and negative impacts to the industry. While the securities industry has kept pace with the times, some new market participants have exhibited an overly strong sense of innovation, which, though introducing vitality, has also raised certain concerns.
The most worrying aspect is the potential for public misunderstanding and unnecessary losses to the general public. Therefore, our association requests your council to conduct a comprehensive study on the charges of institutions engaged in securities business in Hong Kong, particularly the stock brokerage operations, in order to protect the interests of the general public.
Recently, it has been observed that some brokers have been extensively advertising and promoting their services through various public media, online platforms, social media, and public transportation, with a focus on "zero commission/free commission" claims, and even using exaggerated terms to attract public attention. However, after in-depth discussions with our members and market stakeholders, our association has found that the promotional descriptions of some brokers may not accurately reflect the actual situation. For example, some brokers claim "lifetime free commission," but in reality, they charge high fees to customers under other names, resulting in no actual reduction in the fees paid by customers.
Furthermore, some brokers, backed by large capital or funds raised from abroad, have been carrying out large-scale and ubiquitous promotional campaigns in Hong Kong, aiming to promote the concept of "zero commission" to the general public through their extensive promotional network. Our association is concerned that the general public may be misled by such publicity and may even suffer unnecessary losses.
As one of the most influential and sizable trade unions in the securities industry, our association, upholding the principle of advocating for the interests of the securities industry and the public, hereby requests your council to conduct a study on the fee items charged by securities brokers to their customers, before the general public suffers serious damage.
We are sincerely grateful for your attention. If you have any questions or require further understanding about this matter, please feel free to contact me (telephone: / email: @hksfpa.org) or the Head of the Industrial Relations Department, Mr. Wong Hoi-Lok Ivan (telephone: / email: @hksfpa.org) at any time.
Wish you a peaceful spring.
Yours sincerely,
Mofiz Chan
Chairman
Hong Kong Securities and Futures Professionals Association