HKMA and SFC Seek to Further Align Hong Kong OTC Derivatives Reporting Rules with Global Peers

By Elliot Burgess

In September the HKMA and SFC published their conclusions to the latest round of industry consultation on the topic of OTC derivatives reporting changes set to go live on 29th September 2025. Within their responses the Hong Kong rule makers highlighted 4 key areas where their rulemaking was likely to change in response to industry feedback.

1. Unique Transaction Identifier

Importantly, the Hong Kong regulators rejected suggestions by industry participants to adopt ISDA’s UTI logic, highlighting the fact that the ISDA logic is not currently globally harmonized. As such the UTI waterfall provided by the regulators in their consultation paper would remain as the required logic to determine which party to the trade is eligible to generate the UTI.

Additionally, the joint regulators rowed back on their suggestion that they would not allow bilateral agreements to be put in place to pre-determine the UTI generator. In their March consultation the regulators suggested that all market participants would have to use the proposed waterfall logic to determine the UTI generator, however based on the industry’s feedback, it seems the regulators have relaxed their view on this point, and will allow market participants to delegate UTI generation provided a written bilateral agreement is in place between the parties.

Finally the regulators clarified their thinking around the re-submission of actual UTIs in cases where a reporter has been forced to submit an interim UTI if they do not receive an actual UTI from the generating entity in time to report. The regulators clarified that Action Type is the mechanism to replace an interim with an actual UTI (exiting the trade with the “ERROR” attribute and re-entering the trade with the actual UTI via the “NEW” Action Type attribute).

2. Unique Product Identifier

While their position that the UPI be mandated from go live has not changed (given, they argue, that market participants would have to be collecting and reporting UPIs across many other in force regimes including ESMA, ASIC, MAS, JFSA, and CFTC), the joint Hong Kong regulators acknowledged a number of key challenges highlighted by the industry.

In the currently limited market of digital assets and crypto derivatives they acknowledged that there may be the need to accommodate the Digital Token Identifier (DTI), as proposed in the not yet published version 4 of the CDE Technical Guidance, in place of the UPI for such assets.

3. Mandated Critical Data Elements (CDEs)
The Hong Kong regulators acknowledged feedback from the industry that the Hong Kong rules mandate a greater number of CDEs than other APAC reporting regimes set to go live in late 2024 (ASIC and MAS). A number of proposed fields will be switched from mandatory to optional, with a smaller number removed from the scope of Hong Kong reporting altogether.

In addition, the regulators clarified obligations for the re-reporting of live legacy trades, as well as marking down the “Collateral Portfolio Code” as now an optional field – acknowledging that the the pair of IM / VM Collateral Portfolio Codes is the global standard and aligns with existing reporting rewrites.

4. Adoption of the ISO 20022 XML message standard
Finally HKMA and SFC confirmed that the ISO 20022 XML message standard will be adopted by the HKTR on 29th September 2025 in line with the adoption of the CDE reporting attributes. They confirmed that the HKTR will adopt the version auth. 030.001.04 XML schema, which is in line with the same XML schema version adopted by ASIC and MAS at the time of publication of their consultation response.

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