Global menu

Our global pages


HKEX to Extend Regulatory Effect of Share Schemes under the Listing Rules | 联交所扩大《上市规则》下股份计划的监管效力

  • Hong Kong
  • Equity Capital Markets


On 29 July 2022, The Stock Exchange of Hong Kong Limited (the “HKEX”) published the Consultation Conclusions on Proposed Amendments to Listing Rules relating to Share Schemes of Listed Issuers (the “Consultation Conclusions”), highlighting the key amendments to the share scheme regime under Chapter 17 of the Listing Rules (“Chapter 17”), following its consultation paper issued in October 2021.

With effect from 1 January 2023, the following key changes to Chapter 17, will apply to listed issuers as well as Principal Subsidiaries (as defined under the Listing Rules) of listed issuers:

• Extending the ambit of Chapter 17 to include all share schemes (“Share Schemes”), including grants of share awards and share options, while defining the scope of eligible participants (“Eligible Participants”) under the Share Scheme to capture employee participants, related entity participants and service providers;

• Enhancing the regulation of Share Schemes to manage the dilution of listed shares and accordingly, the interest of shareholders; and

• Streamlining the disclosure requirements to maintain high levels of shareholder protection.

Scope of Application of Chapter 17

Extending the ambit of Chapter 17 to capture all Share Schemes

Under the current drafting, Chapter 17 only applies to share option schemes. Nevertheless, share awards involving new issues of shares may present a similar potentially dilutive impact of shareholders’ interests. Although the same would not apply to share awards that are to be satisfied with existing shares, it is equally important to maintain consistency across the applicable rules.

Accordingly, the revised Chapter 17 is intended to encompass all Share Schemes, including both grants of share awards in respect of new and existing shares and share options.

Defining scope of eligible participants

At the moment, “participants” under Chapter 17 is only labelled as a broad generalisation without further classification of the parties that may be captured under Chapter 17.

Following the amendments, the following three categories shall be classified as “participants” for the purposes of Chapter 17.

(1) Employee Participants – directors and employees of the listed issuers or any of its subsidiaries.

(2) Related Entity Participants – directors and employees of the holding companies, subsidiaries and associated companies of the listed issuer.

(3) Service Providers – persons (individual or corporate entity) who provide services to the issuer group on a continuing or recurring basis in its ordinary and usual course of business which are in the interests of the long-term growth of the issuer group.

Service providers may include persons who work for the issuer as independent contractor where the continuity and frequency of their services are akin to those of employees. However, placing agents or financial advisers providing advisory services for fundraising, M&A, or other professional service providers such as auditors or valuers who provide assurance, or are required to perform their services with impartiality and objectivity should be excluded.

Enhancing Regulation of Share Schemes

To afford additional protection for minority shareholders against excessive shareholding dilution and to allow sufficient flexibility for listed issuers, the following key amendments are to be adopted:

Scheme Mandate Limit & Service Providers Sublimit

The current 10% scheme mandate limit shall apply to ALL share schemes, namely, aggregate number of shares which may be issued under all Share Schemes of a listed issuer must not exceed 10% of the relevant class of shares (the “Scheme Mandate Limit”). The Scheme Mandate Limit may be refreshed by shareholders once every three years. If additional refreshments within the three-year period are to be proposed, with certain exemptions, independent shareholders’ approval would be required. As a result, the current 30% limit on outstanding options is unnecessary and is therefore abolished.

In respect of Service Providers, it is required to set a sublimit within the Scheme Mandate Limit and such sublimit must be separately approved by shareholders. The basis for determining the sublimit and an explanation as to why such sublimit is appropriate and reasonable have to be disclosed in the circular of the listed issuer for the approval of the Share Scheme.

Minimum Vesting Period

The minimum vesting period for all grants of share awards and/or options over new shares of the issuer (“Share Grants”) shall not be less than 12 months. The minimum vesting period can be shortened if the following conditions have been fulfilled – (i) the Share Grants are made to Employee Participants; (ii) the relevant scheme document sets out the specific circumstances where the Share Grants are made with a shorter vesting period; and (iii) the explanation of the board of directors (or the remuneration committee if the Share Grants are made to the directors and/or senior management) on why the arrangements are appropriate and how the Share Grants align with the purpose of the scheme has been clearly disclosed in the circular.

Exercise Price or Share Grant Price

The current restrictions on the exercise price of share options are retained. For grants of new shares under share award schemes, no restrictions on the share grant price are imposed.

Restrictions on Large Share Grants to Individual Participants and Share Grants to Connected Persons

The following restrictions on Share Grants are imposed:

(1) Share Grants to an individual participant – shareholders’ separate approval (such participant and his/her close associates (or associates if he/she is a connected person) shall abstain from voting) is required if grants of share awards/ options in the 12-month period (up to and including the date of such granting) in aggregate to an individual participant exceed 1% of the issued shares.

(2) Share Grants to a director, chief executive or substantial shareholder (or any of their respective associates) are subject to the approval of independent non-executive directors (excluding the grantee), and additional independent shareholders’ approval would also be required if the following grant shall result in the shares issued and to be issued to such person in aggregate exceed 0.1% of the total class of shares in issue in the 12-month period:

  • grants of share awards (excluding share options) to a director (other than independent non-executive directors) or chief executive, or any of their associates ; or

  • grant of share awards or options to an independent non-executive directors or substantial shareholder, or any of their associates.

In addition, the HK$5 million de minimis threshold for grants of share options to an independent non-executive director or substantial shareholder of the listed issuer is removed.

Voting of unvested shares

It is now clear that the trustee holding unvested shares of a share scheme, whether directly or indirectly, shall abstain from voting on matters that require shareholders’ approval under the Listing Rules, unless otherwise required by law to vote in accordance with the beneficial owner’s direction and such a direction is given.

Streamlining Disclosure Requirements

Share Grants

Going forward, for Share Grants, disclosure of details for grants made to the following participants are to be made on an individual basis – (i) connected persons (as defined under the Listing Rules); (ii) participants with options and awards granted or to be granted exceeding the 1% individual limit; or (iii) related entity participants or Service Providers with options and awards granted or to be granted in any 12-month period exceeding 0.1% of the relevant class of shares issued.

Specifically, for Share Grants involving performance targets and clawback mechanism, all grant documents and grant announcements must include – (i) a description of the performance targets (which may be qualitative) attached to the awards or options to be granted (or if none, a negative statement to that effect in the grant documents); (ii) a description of the clawback mechanism to recover or withhold the remuneration to any participants (or if none, a negative statement to that effect in the grant documents); and (iii) only for grant announcements, the view of remuneration committee on the Share Grants to directors and senior management without performance targets and/or clawback mechanism.

Disclosure in periodic reports

Further, the listed issuers must disclose (not an exhaustive list):

  • in their annual reports and interim reports certain information regarding the granting of awards/ options to (i) each director, chief executive or substantial shareholder of the listed issuers or their respective associates, (ii) each participant exceeding 1% individual limit, (iii) each related entity participant or service provider exceeding 0.1% limit, and (iv) other participants by category;

  • in their remuneration report or corporate governance report a summary of material matters relating to share schemes that were reviewed and/or approved by the remuneration committee during the financial year;

  • in their annual reports a summary of each share scheme setting out certain details; and

  • for share scheme involving its existing shares, in their annual reports certain information relating to grants to (i) each director, (ii) the five highest paid individuals during the financial year in aggregate; and (iii) other grantees in aggregate.

Application to Share Schemes of Principal Subsidiaries

Certain rules, with appropriate modifications, shall apply to share schemes of a principal subsidiary of a listed issuer (whether these involve new shares issued by the subsidiary or existing shares so held by or for the issuer) as if there were the share schemes of the listed issuer.

A “principal subsidiary” refers to a subsidiary whose revenue, profits or total assets accounted for 75% (or more) of that of the listed issuer under the percentage ratios in any of the latest three financial years.

Transitional Arrangements – What Listed Issuers with an Existing Share Scheme Have to Do?

The revised Chapter 17 would take effect from 1 January 2023 and listed issuers should take note of the impact of the revised rules on the existing Share Schemes of the listed issuers:


Share Option Scheme

Share Award Scheme

With Advanced Mandate

Utilising General Mandate

Disclosure requirements in announcement, interim report and annual report

From 1 January 2023

Share grants to eligible participants (as defined under the revised Chapter 17)

For financial years commencing on or after 1 January 2023

Scheme Mandate

Share grants can be made under the existing scheme mandate

Share grants can be made under the existing scheme mandate 

Note: no further refreshment is allowed

Issuers may grant shares under the general mandate until the second AGM after 1 January 2023

Amendment of terms of scheme to comply with the revised Chapter 17

On or before the refreshment of the scheme mandate limit/ expiry of scheme mandate/ adoption of new share scheme


Listed issuers often adopt Share Scheme to incentivise, motivate and retain talents. The rules pertaining to Share Schemes, or rather share options, were last updated approximately a decade ago and are long overdue for an update to capture the commonly adopted arrangements under current market practices. Listed issuers which intend to adopt new Share Schemes should take note of the new requirements under the revised Chapter 17. In respect of existing Share Schemes which are already in place, listed issuers should review and consider whether they need to revise their terms so as to comply with the new requirements when the existing mandates for such schemes expire.

The amendments echo a common theme that the HKEX has been striving to achieve in the recent years – placing the protection of shareholders (particularly minority shareholders) as a key priority. It would be interesting to observe HKEX’s ongoing updates to other aspects of the Listing Rules as the HKEX continues to unfold its ideas to enhance shareholders’ protection going forward.

Note: the above information is for reference purposes only and should not be regarded as a substitute for taking legal advice. It is only a general outline on the rules pertaining to share schemes of listed issuers under the Listing Rules and the amendments thereto, and is not intended to be exhaustive. If assistance in relation to any particular situation is required, please contact our solicitors.





  • 扩大第17章的范围,以涵盖所有涉及授出股份奬励及股份期权的股份计划(“股份计划”),同时界定股份计划的合资格参与者(“合资格参与者”),包括雇员参与者、关连实体参与者和服务提供者。

  • 提升对股份计划的监管,以管理上市股份的摊薄情况和相应的股东利益;以及

  • 简化披露要求,以维持高水平的投资者保障。








1 雇员参与者——上市发行人或其任何附属公司的董事和雇员。

2 关连实体参与者——上市发行人的控股公司、同系附属公司和联营公司的董事和雇员。

3 服务提供者——一直并持续向上市发行人集团在其日常业务过程中提供有利其长远发展的服务的人士(个人或公司实体)。





目前10%的计划授权限额将适用于所有 股份计划,即上市发行人根据所有股份计划可发行的股份总数不得超过相关类别股份的的10%(“计划授权限额”)。计划授权限额可每三年由股东更新一次。如果要在三年内提出额外的更新,除了某些获得豁免的情况外,还需要经独立股东的批准。因此,目前规定中对未行使股份期权的30%限制变为不必要而被删除。








1 向个别参与者授予股份——如果在12个月内(截至并包括授予日期)向个别参与者授予的股份奖励/股份期权总额超过已发行股份的1%,则需要另行寻求股东的批准(会上参与者及其紧密联系人或(若参与者为关连人士)其联系人必须放弃投票权)。


  • 向董事(独立非执行董事除外)、主要行政人员或其各自的任何联系人授予股份奖励(不包括授予股份期权);或

  • 向独立非执行董事或主要股东,或其各自的任何联系人授予股份奖励或股份期权。










  • 在其年报及中期报告中,披露有关授予(i)每名上市发行人董事、最高行政人员或主要股东或其各自的联系人、(ii)每名超过1%个人限额的参与者、(iii)每名超过0.1%限额的关连实体参与者或服务提供者,以及(iv)其他参与者类别的股份奖励/股份期权的若干资料;

  • 在其薪酬报告或企业管治报告中,提供在该财政年度内经薪酬委员会审阅和/或批准的与股份计划有关的重大事宜摘要;

  • 在其年报中提供每项股份计划的摘要,列明某些细节;以及

  • 对于涉及其现有股份的股份计划,在其年度报告中提供有关授予(i)每位董事,(ii)该财政年度内总薪酬最高的五位人士(合计);以及(iii)其他获授人(合计)的某些信息。