References

Guidance from the SFC, the Hong Kong Stock Exchange and others on the sponsor regulatory regime, initial listing applications, experts and other IPO professionals, reasonable due diligence and compliance with the standards set out in Paragraph 17 of the Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission.

Hong Kong Sponsor Due Diligence Guidelines

March 2016

Index of Reference Documents

Hyperlinks are as at March 2016 and may subsequently change or become outdated. Caution should be exercised to ensure that all laws and regulations consulted are the latest published versions. In particular, please refer to the websites of the Stock Exchange, the SFC and the Hong Kong Department of Justice Bilingual Laws Information System for definitive materials.

I.

SFC Documents
A.
Consultation Papers and Consultation Conclusions issued by the SFC
1. Consultation paper on the regulation of sponsors issued by the Securities and Futures Commission (SFC) in May 2012
2. Consultation conclusions on the regulation of IPO sponsors issued by the SFC in December 2012
3. Consultation Paper on the Regulatory Framework for Pre-deal Research issued by the SFC in September 2010
4. Consultation Conclusions on the Regulatory Framework for Pre-deal Research issued by the SFC in June 2011
B.
Codes and Guidelines issued by the SFC
1. Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission
2. Management, Supervision and Internal Control Guidelines for Persons Licensed by or Registered with the SFC issued by the SFC in April 2003
3. Corporate Finance Adviser Code of Conduct issued by the SFC in October 2011
4. Guidelines for Electronic Public Offering issued by the SFC in April 2003
5. The Code of Conduct for Share Registrars issued by the SFC
6. Guidelines on use of offer awareness and summary disclosure materials in offerings of shares and debentures under the Companies Ordinance issued by the SFC
C.
SFC Dual Filing Updates
Issue Date
1. Issue no. 6 07.2012
2. Issue no. 5 08.2011
3. Issue no. 4 01.2011
4. Issue no. 3 07.2010
5. Issue no. 2 01.2010
6. Issue no. 1 06.2009
7. Update on dual filing 17.06.2008
8. Update on dual filing 03.12.2008
9. Update on dual filing 12.09.2007
10. Update on dual filing 05.12.2007
11. Update on dual filing 28.12.2006
D.
Frequently Asked Questions issued by the SFC
1. Sponsor Regime 08.10.2013
E.
Press Releases issued by the SFC
1. SFC commences legal proceedings against Ernst & Young over access to accounting records (27.08.2012)
2. SFC fines and revokes the licence of Mega Capital (Asia) Company Limited (22.04.2012)
3. SFC imposes ban on Kelvin Wu King Shiu (05.01.2009)
4. SFC Resolves Compliance Issues with Core Pacific-Yamaichi Capital Limited, Core Pacific-Yamaichi International (H.K.) Limited and Core Pacific-Yamaichi Securities (H.K.) Limited (17.04.2008)
5. SFC fines two former South China Capital employees in relation to a listing sponsorship (03.12.2008)
6. SFC Takes Action against Richard Howard Gorges (19.12.2007)
7. Joint Press Release by the SFC, the Federation of Share Registrars Limited, the Hong Kong Monetary Authority and the Hong Kong Association of Banks – Preventive Measure Against Multiple IPO Applications (23.03.2007)
8. SFC Takes Action Against CSC Asia Limited, Mr Chiu Chi Kin Andrew and Mr Tang Ho Wai Howard (07.03.2006)
9. Deloitte & Touche Corporate Finance Limited Voluntarily Refrains from Acting as Sponsors for GEM and Main Board Listings and Chia Kee Loong, Lawrence Voluntarily Refrains from Acting as Supervisor to Sponsorship Mandates (27.06.2006)
10. ICEAC Pays HK$30 Million to Settle SFC Disciplinary Case (27.01.2005)

II.

Stock Exchange Documents
F.
Stock Exchange Listing Rules (consolidated version)
1. Main Board Listing Rules
2. GEM Listing Rules
G.
Frequently Asked Questions issued by the Stock Exchange
 FAQ Series Number First Release (Last Update)
1. Rule changes to complement new sponsor regulation (effective 1 October 2013) Series 24 26.07.2013 (30.09.2014)
2. Rule amendments relating to environmental, social and governance reporting Series 18 31.08.2012
3. Rule amendments relating to property valuation requirements (effective 1 January 2012) Series 15 20.10.2011 (01.04.2015)
4. Review of the Corporate Governance Code and Associated Listing Rules Series 17 19.12.2011 (01.04.2015)
5. Rules amendments relating to Mixed Media Offer (effective 1 February 2011) Series 13 26.11.2010 (08.07.2015)
6. Amendments relating to New Listing Rules for Mineral Companies (effective 3 June 2010) Series 12 26.05.2010 (01.07.2014)
H.
Stock Exchange Guidance Letters
 Reference No. First Release (Last Update)
1. Guidance on pricing policies for continuing connected transactions GL73-14 21.03.2014 (07.2014)
2. Simplification Series – Disclosure in listing documents for IPO cases – the “Applicable Laws and Regulations” section GL72-14 29.01.2014
3. Gambling Activities Undertaken by Listing Applicants and/or Listed Issuers GL71-14 24.01.2014
4. Guidance on suitability for listing GL68-13 06.12.2013 (06.2015)
5. Guidance on disclosure of material non-compliance incidents in listing documents GL63-13 23.07.2013 (09.2013/ 05.2014)
6. Disclosure of Directors, Supervisors and Senior Management section in listing documents GL62-13 23.07.2013 (01.2014/ 03.2014/ 01.2015)
7. Guidance on accelerated procedures for reviewing a Listing Division and Listing Committees decision to return a listing application GL61-13 23.07.2013 (09.2014)
8. Guidance on confirmations required on Expert Opinions in Application Proofs and subsequent draft listing documents (Excluding any report, opinion or statement issued by the Reporting Accountant which is covered by Guidance Letter HKEx-GL58-13) GL60-13 23.07.2013 (09.2014)
9. Guidance on management discussion and analysis on the historical financial information (MD&A) in listing documents GL59-13 23.07.2013 (03.2014)
10. Guidance on confirmations required on the accountants report, pro forma financial information and profit forecast in Application Proofs and subsequent draft listing documents GL58-13 23.07.2013 (09.2014/ 10.2014)
11. Guidance on logistical arrangements for publication of Application Proofs, Post Hearing Information Packs (PHIPs) and related materials on the Exchanges website for listing applicants GL57-13 23.07.2013 (02.2014/ 03.2014/ 06.2014/ 09.2014)
12. Guidance on (i) disclosure requirements for substantially complete Application Proofs; (ii) a 3-day checklist for disclosure matters that the Exchange will check in Application Proofs prior to acceptance; and (iii) publication of Application Proofs and Post Hearing Information Packs on the Exchanges website GL56-13 23.07.2013 (09.2013/ 02.2014/ 03.2014/ 06.2014/ 09.2014/ 08.2015)
13. Guidance on Documentary Requirements and Administrative Matters for New Listing Application (Equity) GL55-13 23.07.2013 (09.2013/ 02.2014/ 03.2014)
14. Guidance on the financial information for the trading record period expected in the first draft listing document for listing applications GL6-09A 23.07.2013 (01.2014/ 05.2014)
15. Guidance on disclosure of: 1. Land use right certificates and/or building ownership certificates for properties in the PRC; 2. Properties with defective titles in the PRC and Hong Kong; 3. Idle land in the PRC; 4. Civil defense projects in the PRC; and 5. Land resettlement operations in the PRC GL19-10 27.07.2010 (07.2013)
16. Simplification Series – Disclosure requirements for IPO cases White and Yellow Application Forms and How to Apply for Hong Kong Offer Shares section in a prospectus GL64-13 23.07.2013 (12.2013/ 03.2014/ 03.2015/ 08.2015)
17. Simplification Series Disclosure in listing documents for IPO cases the Risk Factors section GL54-13 03.05.2013
18. Guidance on liquidity arrangements for issuers seeking to list by introduction where the securities to be listed are already listed on another stock exchange GL53-13 23.04.2013 (07.2013)
19. Disclosure in listing documents for applicant mineral companies that the Exchange normally expects and to address comments raised by the Exchange and the SFC in the vetting of previous listing applications GL52-13 26.03.2013 (07.2013)
20. Simplification Series – Disclosure in listing documents for IPO cases the Business section GL50-13 31.01.2013 (07.2013/ 03.2014)
21. Simplification Series – Disclosure in listing documents for IPO cases the History and Development section GL49-13 31.01.2013 (07.2013)
22. Simplification Series – Disclosure in listing documents for IPO cases the Industry Overview section GL48-13 31.01.2013 (07.2013/ 01.2014)
23. Simplification Series – Disclosure in listing documents for IPO cases the “Summary and Highlights” section GL27-12 12.01.2012 (06.2013/ 07.2013/ 11.2013/ 01.2014/ 04.2014/ 01.2015/ 06.2015)
24. Guidance on unrealised fair value gains on valuation of biological assets for the purpose of trading record and profit requirements under Rule 8.05(1)(a); disclosure requirements for IPO applicants with biological assets and due diligence work expected to be performed by sponsor and other professional advisers on biological assets GL46-12 07.12.2012 (10.2015)
25. Guidance on Pre-IPO investments GL43-12 25.10.2012 (07.2013)
26. Guidance on Pre-IPO investments in convertible instruments GL44-12 25.10.2012
27. Disclosure requirements for IPO cases Disclosure of material changes in financial, operational and/ or trading position after trading record period GL41-12 22.08.2012 (11.2013/ 01.2014/ 01.2015)
28. Guidance on profit forecast under Main Board Rules 9.11(10)(b) and 11.17, GEM Rules 12.22(14b) and 14.29 GL35-12 08.05.2012 (07.2013)
29. Typhoon and rainstorm warning arrangements GL31-12 05.03.2012 (08.2012/ 03.2014)
30. Guidance on publicity materials and e-IPO advertisements GL18-10 30.06.2010 (07.2013/ 03.2014)
31. Guidance on the Latest Practicable Date and the Latest Date for Liquidity Disclosure in listing documents GL38-12 15.06.2012 (07.2013/ 09.2013/ 03.2014)
32. Guidance on indebtedness, liquidity, financial resources and capital structure disclosure in listing documents GL37-12 15.06.2012 (07.2013/ 09.2013/ 01.2014)
33. Guidance on distributorship business model – risks and disclosure in listing documents GL36-12 17.05.2012
34. Disclosure in listing documents for IPO cases Use of Proceeds GL33-12 17.04.2012 (07.2013/ 03.2014)
35. Guidance on business models with significant forfeited income from prepaid packages under Main Board Rules 8.04 and 8.05(1) and GEM Rule 11.06 GL26-12 03.01.2012
36. Guidance on disclosure in listing documents for applicants engaged in the restaurant business under Main Board Rules 2.13(2) and 11.07 and GEM Rules 14.08(7) and 17.56(2) GL28-12 16.01.2012
37. Interim Guidance on Pre-IPO Investments GL29-12 16.01.2012
38. Documentation requirements for IPO cases – facilitative procedures GL23-10 24.12.2010 (07.2013)
39. Sponsor’s due diligence on non-disclosure of confidential information in the listing document GL21-10 22.10.2010 (07.2013)
40. Pre-conditions for a waiver from the financial standards requirements for new applicant Mineral Companies under Main Board Rule 18.04 GL22-10 22.10.2010 (08.2013)
41. Guidance for Chapter 21 companies GL17-10 28.05.2010 (09.2011/ 03.2014/ 08.2015)
42. Listing Document Covers GL13-09 10.2009 (07.2013/ 03.2014)
43. Statistics and data quoted in prospectuses GL8-09 07.2009 (07.2013)
44. Documentary requirements for refiling a listing application (a) more than six months after the date of the original listing application; or (b) where a sponsor has changed GL7-09 07.2009 (09.2010/ 07.2013)
45. Guidance on assessment of a sponsor’s independence GL4-06 04.2006 (07.2013)
46. Simplification Series – Disclosure in listing documents for IPO cases the Summary and Highlights section GL27-12 01.2012 (06.2013/ 07.2013/ 11.2013/ 01.2014/ 04.2014/ 01.2015/ 06.2015)
47. Disclosure of unaudited quarterly/interim financial information in the listing document where the new listing applicant or any of its subsidiaries is listed on another exchange GL82-15 August 2015
I.
Stock Exchange Listing Decisions
 Reference No. First Release (Last Update)
1. To provide guidance on why the Exchange returned certain listing applications LD75-2013 07.2013 (04.2014)
2. Whether Company A has satisfactorily demonstrated that its principal mineral asset has a clear path to commercial production under Rule 18.07 LD74-2013 06.2013
3. Whether Company As non-compliances, uncertainties over the principal retail stores and deteriorating financial performance subsequent to the Track Record Period would render it unsuitable for listing LD73-2013 05.2013
4. Whether Company As directors and senior management, taken together, had sufficient experience relevant to exploration and/ or extraction activity? LD53-2013 03.2013
5. Whether the Target had a clear path to commercial production LD43-2013 01.2013
6. To provide guidance on why the Exchange returned certain listing applications LD48-2013 01.2013
7. Whether Company As deteriorating financial performance and uncertain business prospects would render it unsuitable for listing LD37-2012 09.2012
8. Whether, in view of the fact that, in the conduct of its business in the PRC, Company A was a party to a number of contract-based structures (“Contractual Arrangements”) between or among Company A, PRC Subsidiaries, the OPCOs and the Registered Owners, Company A was unsuitable for listing due to legal questions associated with the Contractual Arrangements LD43-3 Q1.2005 (11.2011/ 08.2012/ 11.2012/ 12.2012/ 11.2013/ 04.2014/ 08.2015)
9. Disclosure requirements for two applicants engaged in the pawn loan business in the Peoples Republic of China (PRC) LD33-2012 07.2012(09.2013)
10. Whether disclosures relating to the allegations in the complaint against certain person(s) whose surname(s) was/ were identical to those of Company As previous management members were adequate and whether a waiver from Rule 18.04 should be granted to Company A in view of the lack of a clear path to commercial production LD31-2012 05.2012
11. Whether Company As financial and operational reliance on Parent Company rendered Company A not suitable for listing LD30-2012 04.2012
12. How Company As non-compliant financing would affect its listing LD19-2011 09.2011 (09.2013/ 10.2013)
13. Whether heavy reliance on a major customer would render Company A unsuitable for listing LD107-1 10.2010
14. Whether Company As regulatory non-compliance record made it unsuitable for listing LD97-1 07.2010
15. Whether persons with past SFC disciplinary records would be suitable to be Company As directors LD96-1 07.2010
16. Whether Company A was suitable for listing where it derived a significant portion of its turnover and net profit from transactions with closely related parties LD92-1 05.2010
17. Whether to allow a continuing connected transaction to exceed three years with an annual cap expressed as a percentage of Company As gross revenues LD88-1 05.2010
18. Whether to waive Chapter 4 requirements so that Company X need not include in its prospectus:- an accountants’ report- pre-acquisition financial information under Rule 4.05A LD85-1 12.2009
19. Whether to waive Rules 4.04(2) and 4.04(4)(a) so that Company A’s accountants’ report need not include the three-year financial statements of the businesses it had acquired after the latest audited balance sheet date LD78-1 10.2009
20. Whether Company A must before listing release Parentcos guarantees of its existing banking facility to demonstrate its financial independence from Parentco LD69-1 07.2009
21. Whether the gain/loss from changes in the fair value of the conversion option in relation to Company A’s redeemable convertible preferred shares should be excluded from the computation of profit under Rule 8.05(1)(a) LD66-1 04.2009 (12.2012)
22. Whether a known breach of applicable investment laws committed by the controlling shareholder in his home jurisdiction would prejudice Company As suitability for listing where such breach was settled prior to listing by agreement with the relevant authority? LD50-5 03.2006
23. Whether Company As reliance on its parent for certain aspects of its operations rendered Company A not suitable for listing? LD51-1 03.2006
24. Whether Company A was so dependent on Parentco as to be not suitable for listing given that (1) the executive directors of Company A overlapped with some of the directors of Parentco; (2) Company A and the Parentco Group were in the same industry sector; and (3) common customers were identified LD51-3 03.2006
25. Whether the respective businesses of the Group and the Parentco Group were adequately delineated and whether the disclosure made in the prospectus regarding the Parentco Group’s engagement in businesses that competed or were likely to compete with the business of the Group was adequate LD51-2 03.2006
26. Whether Company A could meet the requirements of independence from its parent company as contemplated under Paragraph 27A of Part A of Appendix 1 of the Listing Rules in light of the overlapping of directorships between Company A and its parent group LD52-2 03.2006
27. Whether Company A’s reliance on its parent for certain aspects of its operations rendered Company A not suitable for listing LD51-1 03.2006
28. Whether compensation income arising from the one-time early termination of a contract could be counted towards satisfaction of the profit requirements under Listing Rule 8.05(1)(a) LD48-2 12.2005
29. Whether Company As reliance on its Parent for the editorial content of certain publication materials upon which Company A relied for its advertising business rendered Company A not suitable for listing? LD46-2 07.2005
30. Whether Company As reliance on the Parent Group for certain sales and procurement functions upon the deemed listing rendered Company A unsuitable for listing? LD46-1 07.2005
31. Whether (a) deferred tax credits arising out of netting off the tax effect from bad debt provisions; and (b) tax refunds arising out of capitalization of retained profits and statutory surplus reserves, in the financial statements of Company A could be counted towards satisfaction of the profit requirement of Listing Rule 8.05(1)(a) LD45-2 Q1.2005
32. Whether the Applicants were suitable for listing under Rule 8.04 given that they had conducted businesses in certain countries which were subject to trade or economic sanctions imposed by overseas governments before and during the Track Record Period, and if so, how the issue could be addressed LD76-2013 12.2013
J.
Stock Exchange Rejection Letters
 Reference No. Date

1.

 Letter 1 – Extracts of the decision letter of the Head of Listing. Letter 2 – Extracts of the decision letter of the GEM Listing Committee on review.Letter 3– Extracts of the decision letter of the GEM Listing (Review) Committee on review. RL25-09 04.2009

2.

 The Listing Committee rejected the listing application of the Company for the reason that the Group was not able to demonstrate that it is capable of carrying on its business independently of its controlling shareholders and therefore the Listing Committee considered the Group not suitable for listing as required by Listing Rule 8.04. RL-21-07 02.2007
3. Letter 1 – The Listing Committee considered the Company not suitable for listing under Listing Rule 8.04 because the Company’s business model was effectively captive to another company which was both the source of its principal raw materials and its principal customer channel during the Track Record Period. The Listing Committee considered this to be an extreme case that could not be adequately addressed by corporate governance measures alone given the conflicting roles of the Company’s controlling shareholder. Letter 2 – The Listing (Review) Committee decided to uphold the decision of the Listing Committee. RL20-07 02.2007
4. The Listing Committee rejected the listing application of the Company for the reason that the Group should not be considered suitable for listing under Listing Rule 8.04 in light of that the change in the nature of the Company’s revenue generating activities going forward was so fundamental as to affect its suitability for listing and was not a matter which could be dealt with solely by disclosure. RL19-07 02.2007
5. Letter 1 – The Listing Committee rejected the listing application of the Company for the reason that the Company was not considered to be suitable for listing as it had not put in place throughout the track record period the required controls and procedures on which it was relying on for listing eligibility purposes. Letter 2 – The Listing (Review) Committee reversed the rejection decision of the Listing Committee on review. RL15-06 04.2006
6. Letter 1 – The Listing Division rejected the listing application of the Company as the Company failed to satisfy the “capability of carrying on its business independently” requirement of Listing Rule 8.04. Letter 2 – The Listing Committee upheld the rejection decision of the Listing Division on review. RL12-06 04.2006
K.
Consultation Papers and Consultation Conclusions issued by the Exchange
1. Consultation Conclusions on New Listing Rules for Mineral Companies issued by the Stock Exchange in May 2010
L.
Press Releases issued by the Stock Exchange
1. The Stock Exchange news release in relation to the public censure of various parties for breaching the listing rules dated 24 October 2012
2. The Stock Exchange news release in relation to gambling activities undertaken by listing applicants and/or listed issuersdated 11 March 2003

III.

Other
M.
Other documents
1. The Committee of Sponsoring Organizations of the Treadway Commission report Internal Control Integrated Framework issued in 2013
2. Opinion on Further Improving Quality of Disclosure of Financial Information of Companies in Initial Public Offering issued by China Securities Regulatory Commission on 23 May 2012(????????????????????????????????)
3. Report on Sponsor Theme Inspection Findings issued by the SFC in March 2011
4. The Valuation of Forests (Exposure draft) issued by International Valuation Standards Council
5. Stock Exchange Listing Committee Report 2006

Anti-Corruption, Anti-Money Laundering and Sanctions
1. Report on Money Laundering through Money Remittance and Currency Exchange Providers issued by FATF in June 2010
2. Report on Money Laundering and Terrorist Financing in the Securities Sector issued by FATF in October 2009
3. Report on Vulnerabilities of Casinos and Gaming Sector issued by the Financial Action Task Force (FATF) in March 2009

Accountants
1. Technical Bulletin AATB1 Assistance Options to New Applicants and Sponsors in connection with Internal Controls over Financial Reporting, published by the Hong Kong Institute of Certified Public Accountants
2. Technical Bulletin – AATB 3 – Implementation Guidance on Revised Hong Kong Standard on Investment Circular Reporting Engagements (HKSIR) 400 Comfort Letters and Due Diligence Meetings issued by the Hong Kong Institute of Certified Public Accountants in March 2013
3. Hong Kong Standard on Investment Circular Reporting Engagements 400 – Comfort Letters and Due Diligence Meetings issued by the Hong Kong Institute of Certified Public Accountants (HKICPA) in October 2005 and revised in October 2011 and December 2012
4. Hong Kong Accounting Standard 41 Agriculture issued by Hong Kong Institute of Certified Public Accounts, revised in June 2010
5. Professional Ethics Statement 1.203A Independence for assurance engagements issued by the HKICPA
N.
Other References
1. Companies Ordinance (Cap.32 of laws of Hong Kong)
2. Hong Kong Exchanges and Clearing Limited
3. Hong Kong Securities and Investment Institute (HKSI)
4. Securities and Futures Commission (SFC)

Mining Companies
5. National Instrument 43-101 – Standards of Disclosure for Mineral Projects
6. South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves
7. The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves

Due Diligence Guidelines

Hong Kong Sponsors

Due Diligence Guidelines References

Hong Kong Sponsors Due Diligence Guidelines

References for Hong Kong Sponsors

References and Hyperlinks for Due Diligence

Index of References Documents

Consultation Papers and Consultation Conclusions issued by the SFC

Codes and Guidelines issued by the SFC

Due Diligence Checklist

Due Diligence Process
Due Diligence Compliance
Consultation Papers and Consultation Conclusions issued by the Exchange
SFC Dual Filing Updates

Disclaimer

Hong Kong Sponsor Due Diligence Guidelines

2020 edition

Published by HKCFEF Limited

Copyright 2013-2020 © HKCFEF Limited
Coordinating law firm: Charltons

TERMS OF USE

HKCFEF Limited ("HKCFEF") maintains this website (the "Website") for informational purposes only. Please read this agreement carefully before using the Website and the Hong Kong Sponsor Due Diligence Guidelines (referred to as “this publication” or “these due diligence guidelines”) or any other Materials (defined below) published on this Website.   Access to this Website is subject to the terms and conditions set out below.   Your use of the Website signifies your acceptance of this agreement.   If you do not agree to comply with this agreement, please do not use the Website.

Trademarks and Copyrights

HKCFEF (unless otherwise indicated) either owns the intellectual property rights in the underlying HTML, text, images, audio/video clips, and other content that is made available to you on this Website (including these due diligence guidelines, the "Materials"), or has obtained the permission of the owner of the intellectual property to use the Materials on this Website.

HKCFEF grants you a limited licence to display on your computer, print, download, and use the Materials for non-commercial, personal, or educational purposes only, provided that:

No other use is permitted without the express written permission of HKCFEF. Nothing in this notice confers any right in any copyright of HKCFEF or other copyright owner's content provided on this Website.

Cookies

HKCFEF currently uses "cookies" on this Website to monitor traffic patterns and improve our Website. Our cookies do not collect or disclose any personal information about the person using the browser. They are only used to detect the fact that a given visitor has been to our site before in the past. In other words, these cookies help us to differentiate between first time and repeated visitors.

DISCLAIMER: Use of this Website 

Materials provided on this Website are provided "as is" without warranty of any kind, either expressed or implied, including without limitation warranties of merchantability, fitness for a particular purpose, and non-infringement. HKCFEF specifically does not make any warranties or representations as to the accuracy or completeness of any such Materials.  HKCFEF periodically adds, deletes, changes, improves, or updates the Materials on this Website without notice.  Under no circumstances shall HKCFEF be liable for any loss, damage, liability or expense incurred or suffered which is claimed to have resulted from the use of this Website, including without limitation, any fault, error, omission, interruption or delay with respect thereto. Use of this Website is at your sole risk.  Under no circumstances including, but not limited to, negligence, shall HKCFEF be liable for any direct, indirect, incidental, special or consequential damages, even if HKCFEF has been advised of the possibility of such damages. 

You specifically acknowledge and agree that HKCFEF is not liable for any conduct of any user of the Website.

As a condition of use of this Website, you agree to indemnify HKCFEF from and against any and all actions, claims, losses, damages, liabilities and expenses arising out of your use of this Website, including without limitation any claims alleging facts that if true would constitute a breach by you of this agreement. If you are dissatisfied with any material on this Website or with any part of this agreement, your sole and exclusive remedy is to discontinue using this Website.

Some of the links on this Website may lead to resources outside of HKCFEF. The linked sites are not under the control of HKCFEF and HKCFEF has not reviewed or investigated in any way the information at such linked sites.  HKCFEF makes no representation or warranty as to the contents of any linked site or any link contained in a linked site. HKCFEF is providing these links only as a convenience, and the inclusion of any link does not imply endorsement, representation or warranty by HKCFEF.

Communications made through the electronic mail and/or messaging capabilities of this Website shall in no way be deemed to constitute legal notice to or from HKCFEF or any of its employees, or representatives, with respect to any application or existing or potential claim or cause of action against HKCFEF or any of its employees or representatives. 

DISCLAIMER: Use of the Hong Kong Sponsor Due Diligence Guidelines 

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form, or by any means, electronic, mechanical, photocopying, recording, or otherwise, for any commercial purpose without prior permission, in writing from the publisher. Such written permission must be obtained before any part of this publication is stored in a retrieval system of any nature. These due diligence guidelines are available for personal use only in printed books and from this Website (www.duediligenceguidelines.com).  Quotation of the contents of these due diligence guidelines is allowed provided that it is made with explicit reference to the source and publisher.

This publication is distributed with the understanding, and anyone who accesses or uses this publication will be deemed to agree, that HKCFEF Limited, editors, authors, contributors and endorsers of this publication are not rendering legal, accounting, financial or other professional advice or opinions on specific facts or matters and, accordingly, shall not be responsible for and specifically exclude any liability for any loss or damages sustained by any person in any way from the use of, or reliance on, this publication.  Application of the information provided in this publication to specific situations will depend upon the particular circumstances involved and these due diligence guidelines should not be relied upon as a substitute for obtaining appropriate professional advice.  Before making any decision or taking any action that may affect your business, you should consult a qualified professional.

This publication is intended as a general guide solely designed to provide information on the subjects discussed and is based on the experience of HKCFEF Limited and contributing law firms, accountants and sponsors.  This publication has been compiled from the contributions of the author law firms indicated in each chapter, which have been subject to review, comments and revisions from various industry participants, including other law firms, accountants and sponsors, and the views expressed in each chapter are intended to represent the more generally accepted views among industry participants.

Not all chapters of this third edition have been updated to March 2020. Each chapter is only correct as at the date stated in the relevant chapter.

While all reasonable care has been taken in the preparation of this publication, neither HKCFEF Limited nor any contributing law firm, accountant or sponsor accepts responsibility for any errors it may contain or for any losses or damages howsoever arising from, or in reliance on, any of its contents.  Each of HKCFEF Limited and each of the contributing law firms, accountants and sponsors hereby expressly disclaims any duty or obligation to update any of the information or analysis contained in this publication or to forward any revised due diligence guidelines to any previous recipients.  HKCFEF Limited and the contributing law firms, accountants and sponsors make no representations or warranties of any kind and assume no liabilities or obligations of any kind with respect to the accuracy or completeness of the contents and specifically disclaim any implied warranties of merchantability or fitness of use for a particular purpose. No responsibility for loss or damages occasioned to any person acting or refraining from action as a result of the information or material in this publication can or will be accepted by HKCFEF Limited, editors, authors, contributing law firms or endorsers of this publication. Laws and regulations and interpretations of those laws and regulations change frequently and therefore qualified professionals should be consulted in relation to any laws and regulations mentioned in these due diligence guidelines.  While all reasonable care has been taken in the preparation of this publication, the conduct of IPOs in Hong Kong is an area of regulation subject to ongoing guidance from the Regulators.

References are provided for information only and do not constitute endorsement of or by any websites or other sources. Readers should be aware that the websites and links listed in this publication may change.  Where Exchange Guidance Letters and Listing Decisions are referenced in this publication, readers should be aware that The Stock Exchange of Hong Kong Limited has emphasised that the preparation of such Exchange Listing Decisions and Exchange Guidance Letters are based on facts and circumstances, which may not be a precedent for future cases having a different fact pattern.  Readers should note that Exchange Guidance Letters and Exchange Listing Decisions may be amended from time to time and that reference should be made to the latest published versions. 

Any opinions, findings, conclusions or recommendations expressed in this publication do not reflect the views of the Securities and Futures Commission or The Stock Exchange of Hong Kong Limited, a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited. 

HKCFEF Limited and the contributing law firms, accountants and sponsors are not offering these due diligence guidelines as legal, financial or professional advice or services and they should not be relied upon as such.  These due diligence guidelines should not be used as a sole basis for any decision, action or inaction and are not meant to serve as a substitute for the advice of qualified professionals. 

Amendments

HKCFEF may revise this agreement and/or introduce additional terms and conditions at any time and from time to time.  HKCFEF reserves its exclusive right in its sole discretion to alter, limit or discontinue this Website or any of the Material in any respect. 

No Waiver of HKCFEF's Rights

No act, delay or omission by HKCFEF shall affect its right, powers and remedies under this agreement or any further or other exercise of such rights, powers or remedies.  The rights and remedies under this agreement are cumulative and not exclusive of the rights and remedies provided by law.

Severance

If any provision of this agreement is not or ceases to be legally binding and enforceable, it will not affect the legality, binding effect or enforceability of any other provision.

Access to the Website

HKCFEF reserves the right to deny in its sole discretion any user access to this Website or any portion thereof without notice.

Applicable Law and Jurisdiction

This agreement shall be governed by and construed in accordance with the laws of the Hong Kong Special Administrative Region.