On 30 June 2011, the SFC published its consultation conclusions on proposals to expand the scope of conflicts-ofinterest requirements governing research analysts. The requirements governing analyst conduct in preparing investment research reports will be extended to real estate investment trusts ("REITs") and listing applicants.

The SFC made some amendments to its original proposals in its consultation paper of 30 September 2010. In particular, it revised its original proposal to prohibit providing analysts with qualitative forward-looking information not contained in the prospectus or listing document, to prohibiting the provision of material information (both historical and forward-looking) not contained in the prospectus or listing document.

Additionally, in light of the recent interest in listing business operations that are not established in a corporate form (such as business trusts), the SFC decided to extend the conflicts-of-interest requirements to analysts conducting research for business operations that are constituted in a form other than a corporation or a REIT.

Except for the requirements in relation to new listings, the new requirements will come into effect on 1 September 2011. In the case of new listing applicants, the new requirements will apply to any new listing where the listing application is submitted to The Stock Exchange of Hong Kong Ltd on or after 1 August 2011.

To implement the proposals, changes will be made to the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission and the Corporate Finance Adviser Code of Conduct. We previously discussed the proposed changes in the article "SFC consultation on extending scope of analysts' conflicts-ofinterests requirements" in Issue 16 of this Newsletter