The Securities and Futures Commission of Hong Kong and the Securities Commission Malaysia have jointly announced the launch of a "single filing arrangement," under which companies conducting an IPO need only prepare one set of documents for use in both markets, enabling simultaneous listing on the Hong Kong and Malaysian exchanges and opening a "direct channel" for dual listings.

The SFC stated that this move can directly reduce redundant regulatory procedures and compliance costs for companies during the IPO application stage.

According to an SFC circular (https://apps.sfc.hk/edistributionWeb/gateway/TC/circular/doc?refNo=26EC59), applicants intending to seek a primary listing on the Main Board of the Stock Exchange of Hong Kong or the Main Market of Bursa Malaysia while simultaneously seeking a secondary listing on the other market need only submit one listing application and one listing document. The application can be submitted through a centralized and coordinated approach, without the need to file separately in each market or go through two sets of regulatory processes and prepare two sets of documents. In other words, applicants can achieve simultaneous listing in both markets by relying on a single listing document that meets the requirements of both markets.

At the implementation level, the framework includes four design elements: the listing document must simultaneously satisfy the statutory requirements and listing rules of both markets; companies can submit a single centralized application without filing separately in each market; both regulators will each establish dedicated dual-listing review teams and communication channels as direct contact points for applicants and advisers; and through coordination between the two regulators, the SFC, the Stock Exchange of Hong Kong, and the Securities Commission Malaysia will align their timelines to minimize duplication of work and streamline the process of raising queries with applicants.

In short, the "single filing arrangement" merely opens a "fast track" for companies to list in both markets. After the listing materials are submitted, both regulators still need to conduct their own reviews, but through dedicated dual-listing review teams, they will coordinate the review processes in parallel to reduce duplication of work and repeated queries. The responsibilities of the two regulators are not transferred to each other; only the processes are aligned.

On July 23, the two regulators signed a Memorandum of Understanding in Kuala Lumpur, which proposed the concept of a "streamlined dual IPO listing framework." Two months later, the policy was implemented on September 30.

Policy Background: Malaysia May Be a Key Piece in Hong Kong's ASEAN Capital Market Puzzle

On March 27 of this year, Hong Kong Exchanges and Clearing and Bursa Malaysia signed a memorandum of cooperation and jointly launched a co-branded benchmark index, the "HKEX Bursa Malaysia Large Cap Index." The index has a "60/40 structure," with Hong Kong-listed companies accounting for approximately 60% and Malaysian-listed companies accounting for approximately 40% of the weighting, meeting the underlying "Stock Connect eligibility" criteria for ETF Connect. At the time, there were 103 Southeast Asian companies listed in Hong Kong, of which 30 were Malaysian companies, and these 30 companies corresponded exactly to the number of Malaysian constituent stocks in the index.

On July 23, HKEX officially added Bursa Malaysia to its list of recognized stock exchanges, allowing companies listed on Bursa Malaysia's Main Market to directly apply for a secondary listing in Hong Kong. According to HKEX, more than 150 Southeast Asian companies are currently listed in Hong Kong, and Hong Kong is continuing to establish recognized stock exchange arrangements with markets such as Thailand, Indonesia, and Singapore.

Fund Products in Both Markets Already Achieved Mutual Recognition and Cross-Listing in July, Covering Futures, Leveraged and Inverse Products, Commodities, and REITs

Currently, Hong Kong and Malaysia have only introduced a "single filing arrangement" for IPOs and have not achieved "mutual recognition" of materials, which would mean that neither regulator needs to conduct duplicate reviews and one regulator recognizes documents or review results issued by the other. However, in the fund sector, the two markets already achieved Mutual Recognition of Funds in July.

In the press release for the July 23 Memorandum of Understanding in Malaysia, it was mentioned that under the mutual recognition of funds between the two markets, eligible products have been expanded to include ETFs, covering futures-based ETFs, leveraged and inverse ETFs, commodity ETFs, as well as REITs in both markets. Earlier, a framework for mutual recognition of funds between the two markets had existed since 2009, but at that time it only covered "Islamic funds," a very narrow category. Islamic funds have an extremely narrow scope. In the SFC's "list of recognized jurisdictions" program, the only recognized product category corresponding to Malaysia was "Islamic collective investment schemes," and conventional funds, ETFs, and REITs were not included.

Moreover, Islamic funds have seen very little actual implementation. According to Malaysian media reports, since the arrangement was established in 2009, no Hong Kong Islamic CIS has been launched in the Malaysian market. In other words, the framework has existed on paper for more than 16 years, but actual products have been almost nonexistent. The SFC's quarterly report for April to June also stated that it signed a memorandum of understanding with the Securities Commission Malaysia to expand the scope of eligible products under the MRF framework, including non-Islamic ETFs, leveraged and inverse products, and REITs.

How Do Sponsors of "Hong Kong-Malaysia Dual-Listed" IPO Projects Communicate?

SFC Chief Executive Officer Julia Leung said that the two sides have established clear and convenient channels and coordinated regulatory procedures, enabling companies in both markets to access more diversified international investors and a larger pool of capital while maintaining robust investor protection. Securities Commission Malaysia Chairman Dato' Mohammad Faiz Azmi said that streamlining procedures and reducing duplicate submissions will help increase opportunities for cross-border fundraising by companies, connecting Malaysia with Hong Kong as the world's third-largest international financial center, and the attractiveness of both markets as investment destinations will increase accordingly.

However, the implementation of the arrangement does not mean everything is settled. Listing rules, accounting standards, and disclosure requirements between the two markets ultimately differ. According to the circular, the sponsoring team depends on where the primary listing is located — whoever leads signs off, with division of labor based on the primary listing venue. If Hong Kong is the primary listing and Malaysia is the secondary listing, all materials are submitted as a whole to the Stock Exchange of Hong Kong. The filing work is led by an SFC-licensed sponsor, while the Malaysian secondary listing application may be signed by a Malaysian "Recognised Principal Adviser" or by an SFC-licensed sponsor within the same group as the Malaysian Recognised Principal Adviser. When the sponsor submits the appointment notice to the Stock Exchange of Hong Kong, it must also provide information on the principal business.

If Malaysia is the primary listing and Hong Kong is the secondary listing, all materials are submitted to the Securities Commission Malaysia, led by a Malaysian Recognised Principal Adviser; the Hong Kong secondary listing application portion must be signed by an SFC-licensed sponsor. In other words, even if the main process is on the Malaysian side, the signature of a Hong Kong-licensed sponsor remains a mandatory requirement, and professional teams in both markets must form a "cross-exchange collaboration." The lead party (the sponsor or principal adviser in the primary listing market) is responsible for consolidating regulatory requirements from both markets, while the licensed sponsor on the other side is responsible for local compliance sign-off. Teams on both sides need to align the materials checklist before submission.

Accountants Need Dual Compliance with AOB and AFRC

Accountants are the link in this "dual-track" framework with the highest compliance threshold and the strictest timing requirements. Official rules clearly state that the Malaysian reporting accountant must be registered with the Audit Oversight Board under the Securities Commission Malaysia. If a foreign audit firm is appointed, it must first apply to the AOB for recognition. In addition, the rules clearly recommend initiating the process at least three months before submitting the IPO application, indicating that the AOB's recognition timeline for foreign accounting firms is rigid and is an important timing point that sponsors must closely monitor when scheduling.

The Hong Kong reporting accountant must be independent of the issuer in accordance with the Companies Ordinance. If an overseas audit firm is appointed, reference must be made to the Stock Exchange of Hong Kong's "Guide for New Listing Applicants," and the AFRC's PIE auditor registration and recognition arrangements must be verified. For companies interested in a "Hong Kong-Malaysia dual listing," how sponsors communicate with both regulators in advance, whether the primary listing will be in Hong Kong or Malaysia, and how the secondary listing will be arranged will be more complex "homework" compared to a single listing.