1. What is the regime?
Hong Kong's Investor Identification Regime (HKIDR) originates from the SFC's August 2021 consultation conclusions. Under the regime, relevant licensed corporations and registered institutions must:
- Assign each client a Broker-to-Client Assigned Number (BCAN), attached to the client's securities trading orders;
- Submit identification information (client name + identity document details) to the HKEX data repository for clients who place on-exchange orders or conduct non-automatic-matching trades reportable to HKEX.
The effect: regulators can identify who placed an order directly at trade level — no more querying broker-by-broker to trace an investor's identity.
Separately, the OTC Securities Transactions Reporting regime (OTCR) requires reporting to the SFC of off-exchange trades in HKEX-listed ordinary shares and REITs, plus deposits and withdrawals of physical share certificates.
2. Timeline
SFC consultation conclusions published (with Code of Conduct amendments)
Industry end-to-end testing, market rehearsals, investor education (see related circulars)
HKIDR goes live (securities market)
OTCR goes live (OTC securities transactions reporting)
Derivatives-market version: consultation conclusions published
Derivatives HKIDR expected to launch (HKFE futures, options and stock-options auto-matching orders)
3. What intermediaries must prepare
- BCAN assignment system: one code per client, automatically attached to trading orders
- Client data collection: submit client name + identity document details to the HKEX data repository (format per HKEX technical guidelines)
- Client consent: the regime requires client consent before collecting/submitting personal data — the SFC has issued a "Client Consent Forms and Project Timeline Overview" and dedicated circulars on obtaining consent
- OTCR reporting workflow: T+ reporting of off-exchange trades; file templates and submission procedures are set out in a dedicated document (English only)
- Data privacy: comply with privacy law — the derivatives-version circular specifically notes it also applies to firms providing derivatives brokerage or conducting proprietary trading
4. Derivatives-market version (2028)
The June 2026 consultation conclusions confirm a model similar to the securities version, covering futures contracts, options contracts and stock-options auto-matching orders traded on HKFE. Licensed corporations and registered institutions that provide derivatives brokerage or conduct proprietary trading must likewise assign BCANs and submit client names and identity details to the HKEX central data repository.
5. Official sources
| Document | Link |
|---|---|
| Investor Identification and OTC Securities Transactions Reporting topic page | sfc.hk ↗ |
| Investor Identification Regime for the exchange-traded derivatives market (updated 2026-09-30) | sfc.hk ↗ |
| HKIDR end-to-end testing / market rehearsal circulars (22EC26, 22EC33, 22EC55, etc.) | SFC circular portal ↗ |
| Derivatives-version implementation outline + client-consent circulars (26EC60, 26EC61) | SFC circular portal ↗ |
6. FAQ
What is a BCAN?
Broker-to-Client Assigned Number — a unique code each broker assigns to each client, attached to trading orders. Together with the name + identity data submitted to HKEX, it lets regulators identify who placed the order.
What if a client refuses consent?
A broker cannot execute reportable trading orders for a client who withholds consent. Brokers must obtain existing clients' consent before the regime takes effect — this was the heaviest operational workstream for many firms.
What does OTC reporting cover?
Off-exchange trades in HKEX-listed ordinary shares and REITs, plus deposits/withdrawals of physical share certificates. Technical details are in the "Technical Information Document on OTCR" (English only).
Are options market-makers exempt?
Derivatives-version specifics are governed by the 2026 consultation conclusions and the implementation outline — whether market-making gets special treatment requires reading the documents line by line. RegSir can cite the originals directly when you ask.