The Investor Compensation Fund (ICF) was set up under the investor compensation regime of the Securities and Futures Ordinance (SFO) to make compensation to investors who suffer losses due to an intermediary default.

  • Compensation limit: Per-investor basis, for a default occurring on or after 1 January 2020, the compensation limit for trading securities and futures contracts is $500,000 respectively.
  • Product coverage: Securities and futures contracts traded on the Hong Kong Exchanges and Clearing Limited (HKEX) are covered. Since 1 January 2020, the coverage has been extended to the Shanghai and Shenzhen A-shares traded under the Stock Connect (Northbound trades of A-shares).
  • Intermediary coverage: Cover licensed or registered intermediaries including brokerages, banks and securities margin financiers.
  • Defaults: Including insolvency, bankruptcy or winding up, breach of trust, defalcation, fraud or misfeasance. The Investor Compensation Company Limited (ICC), which administers claims against ICF, will determine whether a default has occurred and whether the claimant is entitled to compensation from the fund.

Who are eligible to file a claim for compensation?

Investors may claim compensation from ICF for losses as a result of a default committed by an intermediary. Institutional investors, however are not eligible to claim compensation as the objective of the compensation fund is to provide protection for retail investors.

How does the per-investor compensation limit work?

Example 1: If Mr A holds shares of $600,000 with Blue Securities Company and has deposited $100,000 with the firm for trading futures contracts, what is the compensation limit for Mr A if Blue Securities Company defaults?

Based on the per-investor compensation limit of $500,000 for trading securities and futures contracts respectively, the maximum payments for Mr A's claim would be $500,000 for shares and $100,000 for futures contracts, totalling $600,000.

Example 2: If Ms B has two accounts with White Securities Company holding shares of $400,000 and $500,000 respectively, what is the maximum compensation for Ms B if White Securities Company defaults?

Ms B would be entitled to a maximum payment of $500,000 as the compensation limit is applied on a per-investor basis regardless of how many accounts a person has at the defaulting brokerage.

Example 3: If Mr and Mrs C have a joint account with Red Securities Company holding shares of $1.2 million, what is the maximum compensation for each of them if Red Securities Company defaults?

Mr and Mrs C could each claim a maximum of $500,000 compensation as the compensation limit is applied on a per-investor, rather than per-account, basis.

How can I file a claim?

You can lodge your claim with the ICC before the deadline (usually 3 months from the date of the notice calling for claims) published by the ICC. If no such notice is issued, you may lodge your claim within 6 months after the day you first become aware of the default.

The ICC will issue a notice of determination to you. If the claim is rejected, the reasons will be stated in the notice.

What if I disagree with the determination of the claim application?

You can lodge an appeal with the Securities and Futures Appeal Tribunal.

How can I find out more about the investor compensation arrangements?

You may visit the ICC website (