(10)The legally binding requirements in Hong Kong therefore comprise a two-tiered structure. The core principles for RCHs set out in the SFO (the ‘primary rules’), set out the high-level standards with which RCHs must comply in order to obtain authorisation to provide clearing services in Hong Kong. Those primary rules comprise the first tier of the legally binding requirements in Hong Kong. In order to prove compliance with the primary rules, RCHs must submit their internal rules and procedures to the SFC for approval. Those internal rules and procedures comprise the second tier of the legally binding requirements in Hong Kong, which must provide prescriptive detail regarding the way in which the RCH will meet those standards in accordance with the Guidelines. Once approved by the SFC, the internal rules and procedures become legally binding upon the RCH.