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Glossary

Glossary

Term Definition
Annual benefit statement (“ABS”)
A report issued by an MPF scheme’s trustee to its members to provide them with individual account-level information about their MPF accrued benefits and investments. It is to be provided within three months after the end of the financial period of that scheme, and covers information about:
  • contributions;
  • transfers and transactions;
  • account balances and accruals and the extent to which they are vested; and
  • the gains and losses associated with the accounts over the relevant financial period.
Age 65 Plus Fund One of the two DIS Constituent Funds used in the Default Investment Strategy of a registered scheme.  It is a mixed assets fund which invests in a globally diversified manner that targets to invest 20% of its net asset value in higher risk assets (such as global equities) and the rest in lower risk assets (such as global bonds). The investment in those assets may vary from 15% to 25% of the net asset value of the fund at any point in time.
Approved pooled investment fund (“APIF”) A type of investment fund that a constituent fund invests into. An APIF can be in form of an insurance policy or a unit trust.
Approved trustee A company or a natural person approved by MPFA as a trustee in accordance with section 20 of the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong). The term is usually used interchangeably with MPF trustee.
Bid spread Amount charged by the trustee/sponsor upon redemption of units of a Constituent Fund by a scheme member. Bid spread does not apply to an MPF Conservative Fund. Bid spread for a transfer of benefits, withdrawal of benefits in a lump sum, or the first four withdrawals of benefits by instalments in a year can only include necessary transaction costs incurred or reasonably likely to be incurred in selling or purchasing investments in order to give effect to the transfer or withdrawal and are payable to a party other than the trustee. Details are provided in the Fee Table of a scheme.
Casual employee An employee who is at least 18 but under 65 years of age, and is employed in the construction industry or the catering industry on a day-to-day basis or for a fixed period of less than 60 days.
Compensation Fund A fund established under the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong) to compensate members of MPF schemes and other affected persons for losses of accrued benefits attributable to misfeasance or illegal conduct by the trustees of those schemes or by other persons concerned with the administration of those schemes.
Conduct requirements Requirements set out in the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong) on conduct requirements for MPF intermediaries or responsible officer.
Continuing Professional Development (“CPD”)
A continuing training requirement specified under the Guidelines on Continuing Training for Registered Intermediaries. All individual subsidiary intermediaries are required every calendar year to complete:
  • two hours of core CPD activities; and
  • eight hours of non-core CPD activities.
Contribution account An account into which primarily mandatory contributions and any voluntary contributions are paid in respect of any current employment or current self-employment of a member of an MPF scheme.
Contribution day
The day by which an employer is required to pay mandatory contributions for their employees (or by which a self-employed person must make his/her mandatory contributions) to the trustee of the relevant MPF scheme. This is:
  • for regular employees – the 10th day after the last day of a calendar month within which the contribution period ends (or the 10th day after the last day of the month during which the permitted period ends if this is a later date);
  • for casual employees under Industry Schemes – the 10th day after the last day of the contribution period or the next working day ("other than a Saturday") after payment of relevant income for the contribution period;
  • for casual employees under Master Trust Schemes and Employer-sponsored Schemes – the 10th day after the last day of the contribution period (or the 10th day after the last day of the contribution period during which the permitted period ends if this is a later date); and
  • for self-employed persons – the last day of the contribution period.
In computing a period of time for the first contribution, the above mentioned permitted period for the determination of the contribution day for regular employees or casual employees, as the case may be, will not be extended even if it ends on a Saturday, a public holiday, a gale warning day or a black rainstorm warning day.  If the contribution day falls on a Saturday, a public holiday, a gale warning day or a black rainstorm warning day, the contribution day is extended to the next following day which is not a Saturday, a public holiday, a gale warning day or a black rainstorm warning day. 
Contribution holiday The first 30 days of employment and any incomplete contribution period or calendar month (depending on the remuneration cycle (e.g. weekly, monthly, quarterly) of the employee concerned) that immediately follows, during which regular employees are not required to make mandatory contributions. This does not apply to casual employees and self-employed persons.
Contribution period
(a)
In relation to an employer, every period for which the employer pays or should pay relevant income to an employee;
(b)
In relation to a regular employee, every period for which the employer pays or should pay relevant income to the employee, excluding the period covered by the contribution holiday; and
(c)
In relation to a casual employee, every period for which the employer pays or should pay relevant income to the employee.
Contribution surcharge A late charge imposed on employers or self-employed persons who fail to pay mandatory contributions by the contribution day. This surcharge is calculated at 5% of the contribution amount in arrears, and monies received are credited to the MPF accounts of the employees/self-employed persons concerned.
Core Accumulation Fund One of the two DIS Constituent Funds used in the Default Investment Strategy of a registered scheme.  It is a mixed assets fund which invests in a globally diversified manner that targets to invest 60% of its net asset value in higher risk assets (such as global equities) and the rest in lower risk assets (such as global bonds). The investment in those assets may vary from 55% to 65% of the net asset value of the fund at any point in time.
Custodian A person or institution to which an approved trustee has delegated care of trust assets. The custodian physically holds the assets and is likely to be an authorized bank or a registered trust company.
Debt security
Debt instruments issued by governments, quasi-governmental bodies or large corporations to raise capital. The issuer promises to repay the debt instrument holders the total amount borrowed. That repayment in most cases is made on maturity although some loans are repayable in instalments. Examples include:
  • bonds;
  • structured notes;
  • commercial papers; and
  • debentures.
DIS Constituent Fund A constituent fund used in the Default Investment Strategy ("DIS"). The two DIS constituent funds are called the Core Accumulation Fund and the Age 65 Plus Fund.
Default contribution (“DC”) The outstanding sum when an employer or a self-employed person fails to pay mandatory contributions to an MPF trustee by the contribution day as required under the MPF legislation.
Default fund A fund designated for each MPF scheme by the trustee, into which a scheme member’s contributions are to be invested in the event that the scheme member fails to select a fund. The default fund can be any type of fund available under the MPF scheme.
Defined benefit scheme An occupational retirement scheme which is not a defined contribution scheme.
Defined contribution scheme
An occupational retirement scheme which provides that the amount of a benefit under the scheme is to be an amount determined solely by reference to:
(a)
The contributions to the scheme's funds by or in respect of the member concerned and any declared return in respect of such contributions (where such return may be subject to a minimum guaranteed rate but is otherwise unascertainable before it is declared); and
(b)
Where appropriate, the qualifying service and age of the employee.
Default investment arrangement A default arrangement provided before the commencement of the Default Investment Strategy (i.e. 1 April 2017) in the governing rules of a registered scheme under which the accrued benefits in an account of a scheme member who has not given any specific investment instructions for those benefits are invested.
Default Investment Strategy ("DIS") A ready-made investment solution with fee control designed for MPF scheme members who are not interested or do not wish to make a selection of funds.  DIS is a strategy that uses two constituent funds, i.e. the Core Accumulation Fund and the Age 65 Plus Fund, and automatically reduces risk exposure as a member approaches retirement age.  DIS is required by law to be offered in each registered scheme.   DIS is also available as an investment choice to scheme members who find it suitable for their own circumstances.
Domicile In relation to an occupational retirement scheme or trust, the country, territory or place by whose system of law the scheme or trust is governed.
Early retirement Normally, a member of an MPF scheme is entitled to withdraw his/her accrued benefits held in the scheme upon reaching the age of 65. When a scheme member has reached the age of 60 and has ceased all employment and self-employment with no intention of becoming employed or self-employed again, he/she may also withdraw his/her accrued benefits held in the scheme in a lump sum or by instalments on the ground of early retirement.
Employee Choice Arrangement (“ECA”) Allows employees to transfer the accrued benefits (i.e. the accumulated contributions and investment returns) arising from their mandatory contributions (not their employer’s portion) in their MPF contribution accounts during the period they are working for their current employer. Such benefits can be transferred to a trustee and a scheme of their own choice on a lump sum basis once every calendar year.
Employer sponsored scheme An MPF scheme whose membership is limited to the employees of a single employer and its associated companies (if any).
Exempt person
A person in any one of the following categories:
  • domestic employees;
  • self-employed hawkers;
  • people covered by statutory pension or provident fund schemes, such as civil servants and subsidized or grant school teachers;
  • relevant employees (other than casual employees) who are employed for less than 60 days;
  • members of occupational retirement schemes which are granted MPF exemption certificates;
  • people from overseas who enter Hong Kong for employment for not more than 13 months, or who are covered by overseas retirement schemes; and
  • employees of the European Union Office of the European Commission in Hong Kong.
Fee table A standardized table showing fees, expenses and charges imposed on an MPF scheme at a glance. The format of the Fee Table is the same across different trustees to help scheme members make basic comparison of fees, expenses and charges across different schemes and service providers. The Fee Table is contained in the Offering Document of a scheme.
Financial penalty A penalty imposed by MPFA on employers, self-employed persons or trustees who fail to comply with the requirements under the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong) and the Mandatory Provident Fund Schemes (General) Regulation ("General Regulation") (Chapter 485A, Laws of Hong Kong). The amounts of financial penalty are specified in Schedule 4 to the General Regulation.
Forward pricing The pricing mechanism on the basis of which MPF funds operate. Since offer and redemption prices of an MPF fund are calculated on the basis of its net asset value divided by the number of units outstanding, the unit price is not known until the end of a business day. A buy or sell order is executed on the next available issue price according to the valuation frequency and pricing method adopted by the trustee/fund administrator. In other words, the execution price may be better or worse than the last available price known at the time the buy/sell order is made.
Frontline regulator (“FR”)
Under new regulatory regime, MPFA can assign an industry regulator as the frontline regulator for each MPF intermediary. Frontline regulators are responsible for the supervision and investigation of MPF intermediaries according to their core business, specifically:
  • Monetary Authority, for those in banking;
  • Insurance Authority, for those in insurance; and
  • Securities and Futures Commission, for those in securities.
Fund expense ratio (“FER”) A ratio that measures the expenses of an MPF fund as a percentage of fund size. Whilst scheme members do not directly pay fund expenses, such expenses do impact directly on the investment returns of the fund. Fees and charges are generally the main component of fund expenses. The FER is calculated for each financial period of a constituent fund based on data from the previous financial period. The published FER will not reflect any increases or decreases in fees, charges or expenses in the current financial period. The FER is provided in the Fund Fact Sheet of a scheme. It is not necessary for funds with less than two years of history to show an FER.
Fund fact sheet Fund Fact Sheet is like the report card of an MPF fund, reporting on how the fund is doing. It provides key summary information on a constituent fund, such as fund size, investment objectives, portfolio allocation, main holdings in the portfolio, fund performance, fund expense ratio, fund risk indicator and future outlook for each constituent fund in a scheme. Fund Fact Sheet is issued on a half-yearly basis.
Fund risk indicator Fund risk indicator shows the risk of an MPF fund. It is provided in the Fund Fact Sheet and helps scheme members choose and decide on the risk level to take in their MPF investment. The risk of a fund is important because research suggests that there is a trade-off between risk and investment return. A fund with higher risk tends to show greater volatility of return than a low-risk fund. It also has the potential to offer higher expected return than a low-risk fund. Its downside potential is increased similarly.
Fund size The net asset value of a constituent fund as at the reporting date of the Fund Fact Sheet.
Future contribution All future monies not yet received and allocated to a member's MPF account, which may be contributions to be remitted by his/her employer for future contribution periods.
Guarantee/qualifying condition A condition normally imposed by a Guaranteed Fund. Upon meeting that condition, fund holders can receive the guaranteed return when redeeming the fund.
Guarantee fee The amount deducted out of the assets of a Guaranteed Fund for the purpose of providing the guarantee. The fee is usually charged as a percentage of the fund’s net asset value.
Higher risk assets The MPF legislation requires that a DIS Constituent Fund of a registered scheme should target to invest certain percentage of their net asset value in higher risk assets. The following assets are identified as “higher risk assets” in the MPF Guidelines issued by MPFA:
(a) shares;
(b) warrants;
(c) financial futures contracts and financial option contracts that are used other than for hedging purposes;
(d) interests in an index-tracking collective investment scheme that tracks an index comprised of equities or equities-like securities; and
(e) any investment approved by the Authority under section 8(1)(c), 8(2)(b) or 8(2)(c) of Schedule 1 to the Mandatory Provident Fund Schemes (General) Regulation excepting the following:
(i) that part of a unit trust or mutual fund authorized by the Securities and Futures Commission that is invested in assets or securities other than those set out in items (a) to (d) above.
Index-tracking collective investment scheme A collective investment scheme with the sole investment objective of tracking or replicating the investment performance of an index in either equities or debt securities. This type of fund aims at producing or achieving investment returns that closely match or correspond to the performance of the index being tracked.
Industry regulator Industry regulator means:
  • Monetary Authority;
  • Insurance Authority; or
  • Securities and Futures Commission.
Industry scheme A provident fund scheme registered under section 21A of the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong). This type of scheme is specially designed for employees who are engaged in industries with high labour mobility. Currently there are two industry schemes, each of which is available to employees and employers in the construction and catering industries.
Investment objective Information about the types of instruments the pooled contributions will be invested in and the level of return and growth the fund aims to achieve.
Mandatory contribution
In the case of an employee, an amount which is equal to 10% of the employee’s relevant income (5% payable by the employer out of its own funds, 5% payable by the employee to be deducted from his/her relevant income) except in the following cases:
  • for employees whose relevant income exceeds the maximum relevant income level - each of employer’s mandatory contributions and employee’s mandatory contributions is capped at 5% of the maximum relevant income level; and
  • for employees whose relevant income is below the minimum relevant income level - employees are relieved of the obligation to make employee’s mandatory contributions, though their employers are still required to make employer’s mandatory contributions for them.
Master trust scheme
An MPF scheme (excluding Industry Schemes) whose membership is open to:
(a) the employees of more than one employer;
(b) self-employed persons and former self-employed persons; and
(c) persons who wish to have their benefits transferred to such a scheme from an ORSO exempted scheme or an ORSO registered scheme.
Membership certificate
A certificate issued to a relevant employee by the trustee of an MPF scheme within 60 days of the employee becoming a member of the scheme, showing:
  • the scheme name; 
  • the scheme member’s name;
  • the trustee’s name and address; and
  • the issue date of the certificate.
An MPF trustee is not required to give a membership certificate to a casual employee who is a member of an industry scheme.

* With effect from 1 August 2015, the notice of participation replaces the membership certificate.
Minimum MPF benefits (“MMB”)
In relation to a member of an MPF exempted ORSO registered scheme, the lesser of the following:
(a)
the member's benefits accrued and held under the scheme during the period when the MPF exemption certificate applied to the scheme; and
(b)
1.2 × final average monthly relevant income × years of post-MPF service.
MPF exempted ORSO scheme An occupational retirement scheme in respect of which an exemption has been granted under section 5 of the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong). Members, or a class of members, of such a scheme and their employer are exempted from the operation of all or any specified provisions of the Ordinance.
MPF principal intermediary (“PI”)
A business entity (Type A regulatee) registered by MPFA as an intermediary for carrying on regulated activities. It may be:
  • in relation to the Monetary Authority, an authorized financial institution registered under the Securities and Futures Ordinance (“SFO”) (Chapter 571, Laws of Hong Kong) to carry on Type 1 or Type 4 regulated activity, or both; 
  • a corporation licensed under the SFO to carry on Type 1 or Type 4 regulated activity, or both; 
  • a company authorized under the Insurance Companies Ordinance (“ICO”) (Chapter 41, Laws of Hong Kong) to carry on long term business; or
  • an authorized long term insurance broker under the ICO.
MPF registered intermediary / registered intermediary MPF registered intermediary / registered intermediary means:
  • an MPF principal intermediary; or
  • an MPF subsidiary intermediary.
The MPFA keeps a Register of registered intermediaries. The Register enables a member of the public to, by inspecting the Register or, upon payment of a fee, by obtaining a copy of an entry in or extract of the Register, ascertain whether he/she is dealing with a registered intermediary in any regulated activity, or to ascertain the particulars of the registration of a person as a principal or subsidiary intermediary.
MPF subsidiary intermediary / subsidiary intermediary (“SI”)
A person (Type B regulatee) registered by MPFA as an intermediary for carrying on regulated activities on behalf of the principal intermediary to which the person is to be attached. The person may be:
  • a person licensed under the Securities and Futures Ordinance (“SFO”) (Chapter 571, Laws of Hong Kong) to carry on Type 1 or Type 4 regulated activity, or both;
  • a relevant individual registered under the Banking Ordinance (“BO”) (Chapter 155, Laws of Hong Kong) as engaged in respect of Type 1 or Type 4 regulated activity, or both within the meaning of SFO;
  • an appointed long term insurance agent under the Insurance Companies Ordinance (Chapter 41, Laws of Hong Kong) ;
  • a registered responsible officer/technical representative of an appointed long term insurance agent; 
  • a registered chief executive/technical representative of an authorized long term insurance broker; or
  • a person who with the consent of the Monetary Authority under the BO, is an executive officer of a registered institution appointed under section 71D of that Ordinance to be responsible for directly supervising the conduct of each business conducted by the registered institution that constitutes Type 1 or Type 4 regulated activity, or both, within the meaning of the SFO.
Net asset value (“NAV”) In respect of a constituent fund or class of a constituent fund, the total value of asset net of any liabilities of the fund.
Notice of acceptance
A notice given to a scheme applicant conveying acceptance into an MPF scheme. This is issued by the relevant MPF trustee within 30 days from:
  • the date on which the applicant submits all required information for membership/participation; or
  • the date on which the applicant agrees to observe and accept the governing rules of the scheme -
whichever is the later.

* With effect from 1 August 2015, the notice of participation replaces the notice of acceptance.
Notice of participation
A notice given to an applicant to confirm membership of or participation in a registered scheme by the trustee of an MPF scheme within 30 days after whichever is the later of the following dates:
  • the date on which all the information required for the application is submitted;
  • the date on which the applicant agrees to comply with the governing rules of the scheme.
The notice of participation shows:
  • the name of the scheme;
  • the trustee's name and address;
  • the name of the scheme member or participating employer; and
  • the date of issue of the notice.
Occupational retirement scheme (“ORSO scheme”)
Subject to section 2(6) of the Occupational Retirement Schemes Ordinance (Chapter 426, Laws of Hong Kong), any scheme not being a contract of insurance under which benefits are payable only upon the death or disability of the insured, which-
(a)
is comprised in one or more instruments or agreements; and
(b)
has or is capable of having effect in relation to one or more descriptions or categories of employment so as to provide benefits, in the form of pensions, allowances, gratuities or other payments, payable on termination of service, death or retirement, to or in respect of persons gainfully employed (whether in Hong Kong or elsewhere) under a contract of service in any employment, and includes, where the context admits, a proposed such scheme.
Offer spread Amount charged by the trustee/sponsor upon subscription of units of a Constituent Fund by a scheme member. Offer spread does not apply to an MPF Conservative Fund. Offer spread for a transfer of benefits can only include necessary transaction costs incurred or reasonably likely to be incurred in selling or purchasing investments in order to give effect to the transfer and are payable to a party other than the trustee. Details are provided in the Fee Table of a scheme.
Offering document A document inviting participation in an MPF scheme by prospective members. It should contain the necessary information for prospective members to make informed decisions about the scheme. It contains important information about the scheme, operators, constituent funds, contributions and withdrawals, fees, expenses and charges, warnings and other important issues.
On-going cost illustration (“OCI”) An illustration of the total effect of fees, expenses and charges payable in dollar terms by converting the latest Fund Expense Ratio figure into dollars and adding that to any direct charges that a scheme member might pay, such as a contribution charge or offer spread. It shows the dollar costs of investing HK$1,000 in different funds over periods of one, three and five years under an assumed annual rate of investment return of 5%.
ORSO exempted scheme
(a)
An occupational retirement scheme in respect of which an exemption certificate has been issued under section 7 of the Occupational Retirement Schemes Ordinance (Chapter 426, Laws of Hong Kong) and any withdrawal under section 12 has not come into effect; or
(b)
An occupational retirement scheme within the meaning of the ORSO where the employer of the scheme is the government of a place outside Hong Kong or an agency or undertaking of or by such a government which is not operated for the purpose of gain.
ORSO registered scheme An occupational retirement scheme registered under section 18 of the Occupational Retirement Schemes Ordinance (Chapter 426, Laws of Hong Kong).
ORSO scheme administrator
  • In the case of a scheme or pooling agreement governed by a trust, the trustee concerned;
  • In the case of a scheme or pooling agreement which is the subject of or regulated by an insurance arrangement, the insurer concerned;
  • In any other case, the person who is principally responsible for the management of the scheme and its assets otherwise than as a person who is solely concerned with the investment or custody of the assets.
Participation certificate
A certificate issued by MPFA to an employer as a documentary proof of its registration in an MPF scheme, which the employer is required to display at its premises where employees are employed or at its principal place of business in Hong Kong. The participation certificate shows:
  • the employer's name and participation number;
  • the scheme's name; and
  • the certificate number and issuance date.
* From 1 August 2015, MPFA no longer issues participation certificate.
Payroll cycle The intervals at which the employee is paid relevant income by the employer for work done under his/her employment contract. It is common for employees to be paid monthly, though there are more frequent cycles, such as half-monthly or weekly.
Performance requirement A requirement for:
  • in relation to a registered intermediary, means (i) a requirement under section 34ZL of the Mandatory Provident Fund Schemes Ordinance (“MPFSO”) (Chapter 485, Laws of Hong Kong); or (ii) a condition to which the registration as a principal or subsidiary intermediary, or the approval of the attachment to a principal intermediary, is subject by virtue of section 34X of the MPFSO; or
  • in relation to a responsible officer, means (i) a requirement under section 34ZM; or (ii) a condition to which the approval as such responsible officer is subject by virtue of section 34X of the MPFSO.
Permitted period
Permitted period in the context of performing enrolment for an employee/a self-employed person into an MPF scheme:
(a)
in the case of a regular employee, the first 60 days of employment within which the employer is required to enrol the employee into an MPF scheme;
(b)
in the case of a casual employee, the first 10 days of employment within which the employer is required to enrol the employee into an MPF scheme; and
(c)
in the case of a self-employed person, the first 60 days after the date on which the person becomes self-employed within which the person is required to enrol himself/herself in an MPF scheme.
If the last day of a permitted period is a Saturday, a public holiday, a gale warning day or a black rainstorm warning day, the permitted period is extended to end on the next following day which is not a Saturday, a public holiday, a gale warning day or a black rainstorm warning day.
Personal account An account holding a scheme member’s MPF accrued benefits, including contributions and investment returns, in respect of former employment or self-employment. New contributions to this account are generally not accepted, though the accrued benefits will continue to be invested according to the scheme member’s instructions, and thus fees and charges may still be incurred.
Prescribed savings rate A rate prescribed by MPFA on a monthly basis as the interest rate payable in respect of a Hong Kong dollar savings account or the average of the interest rates payable by different authorized financial institutions on Hong Kong dollar savings accounts. If the investment return of an MPF Conservative Fund does not exceed the prescribed savings rate in a month, no administrative expense is allowed to be deducted from the fund for that month.
Qualifying examination An examination designed for applicants for MPF intermediaries and specified by MPFA.
Recognized reference portfolio A disclosure tool developed by the fund industry and recognized by MPFA for providing a reference point for performance comparison of a DIS Constituent Fund. The reference portfolio for each DIS Constituent Fund is a globally diversified portfolio with the weighting to higher risk assets consistent with the requirements for the DIS Constituent Fund as set out in the MPF legislation.
Recurrent out-of-pocket expenses In relation to a DIS Constituent Fund, the expenses incurred by an approved trustee of the fund that are charged to or imposed on the fund or a scheme member who invests in the fund and are incurred on a recurrent basis in the discharge of the approved trustee’s duties to provide services in relation to the fund. They include auditor’s fee for annual audit, printing expenses and postage, fund price publication expenses, bank charges, governmental fees and charges (including but not limited to stamp duty and licence fee), other charges and expenses properly incurred and permitted under the Mandatory Provident Fund Schemes Ordinance, the regulations and the governing rules of the relevant registered scheme.
Registered scheme
Also known as an MPF scheme, a provident fund scheme registered under the relevant provisions of the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong) as:
  • an employer sponsored scheme;
  • a master trust scheme; or
  • an industry scheme.
Regular employee An employee who is at least 18 but under 65 years of age and has been employed in any industry for a continuous period of 60 days or more.
Regulated activity
A person carries on a regulated activity if the person:
(1)
invites or induces, or attempts to invite or induce, another person to make a material decision, namely a decision as to any of the following matters:
(a)
whether, or when, to apply to join or become a member of a particular registered scheme;
(b)
whether, or when, to apply to participate in a particular registered scheme as an employer;
(c)
whether, or when, to pay contributions (including voluntary contributions) to a particular registered scheme, or to invest in a particular constituent fund of a  registered scheme;
(d)
the amount of contributions (including voluntary contributions) to be paid to a particular registered scheme, or the amount to be invested in a particular constituent fund of a registered scheme;
(e)
whether, or when, to transfer accrued benefits from a particular registered scheme to another particular registered scheme, or from a particular constituent fund of a registered scheme to another particular constituent fund of the registered scheme;
(f)
the amount of accrued benefits to be so transferred from a particular registered scheme to another particular registered scheme, or from a particular constituent fund of a registered scheme to another particular constituent fund of the registered scheme;
(g)
whether, or when, to transfer benefits from an occupational retirement scheme to a particular registered scheme;
(h)
the amount of benefits to be so transferred from an occupational retirement scheme to a particular registered scheme;
(i)
whether, or when, to make a claim for the payment of accrued benefits from a registered scheme;
(j)
the amount of a claim mentioned in paragraph (i).
  or
(2)
gives regulated advice by giving an opinion in relation to any of the matters specified in (1)(a) to (j) above.
Despite the above, a person does not carry on a regulated activity if
(1)
the person issues an advertisement, invitation or document; and
(2)
the issue is authorized by the Securities and Futures Commission under section 105 of the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong).
Regulated person A registered intermediary or a responsible officer of a principal intermediary.
Relevant employee An employee who is at least 18 but under 65 years of age.
Relevant income In relation to a relevant employee, any wages, salary, leave pay, fee, commission, bonus, gratuity, perquisite or allowance, expressed in monetary terms, paid or payable by an employer (directly or indirectly) to that relevant employee in consideration of his employment under that contract, but not including severance payments or long service payments under the Employment Ordinance (Chapter 57, Laws of Hong Kong).
Remittance statement
A statement provided by an employer to the trustee of an MPF scheme along with the contributions for a contribution period, showing:
  • the relevant income of each relevant employee for the contribution period;
  • the employer’s mandatory contributions in respect of each relevant employee;
  • the employee’s mandatory contributions of each relevant employee; and
  • the employer’s and employee’s voluntary contributions, if any.
Reserve charge The amount deducted out of the assets of a Guaranteed Fund for the purpose of providing the guarantee. The fee is usually charged as a percentage of the net asset value of a Guaranteed Fund.
Responsible officer In respect of an MPF principal intermediary, an individual approved as an officer with specified responsibilities in relation to the principal intermediary under sections 34T(2)(a)(ii), 34T(2)(b)(iii) or 34W(4) of the Mandatory Provident Fund Schemes Ordinance (Chapter 485, Laws of Hong Kong).
Restricted investment In relation to a registered ORSO scheme,
  • any security of, or issued by, the relevant employer of the registered ORSO scheme or an associate of such employer except security issued by an associate of such employer in the form of an option which if exercised will constitute investment in the share capital of a body corporate other than the relevant employer or an associate of such employer; or
  • any security in the form of an option which if exercised will constitute investment in the share capital of the relevant employer of the registered ORSO scheme or an associate of such employer.
Scheme administrator
In relation to an MPF scheme, an administrator responsible for the scheme’s administration and for fulfilling certain functions, including:
  • processing members’ enrolment and fund transfers;
  • handling contributions and withdrawal requests;
  • keeping proper accounting records for the scheme; and
  • providing member benefit statements.
For some schemes, the scheme administrator is also the trustee of the scheme.
Self-employed person A person whose relevant income is derived from the person’s production of goods or services in Hong Kong, or trade in goods or services in or from Hong Kong.
Special voluntary contribution Contributions unrelated to employment paid directly by a relevant employee to the MPF trustee of an MPF scheme, without the involvement of his/her employer.
Transferee trustee The trustee of the MPF scheme to which the accrued benefits of a member of another MPF scheme are to be transferred.
Transferor trustee The trustee of the MPF scheme from which the accrued benefits of a scheme member are to be transferred, whether to another MPF scheme or to another account within the same scheme.
Unclaimed benefit Accrued benefits to which an MPF scheme member or some other persons have become entitled to be paid and for which they may or may not have lodged a claim become unclaimed benefits if after a six-month period the trustee has been unable to locate the individual for payment.
Vested benefit In relation to a member of an occupational retirement scheme, the amount of benefits the member is entitled to receive, either immediately or prospectively, according to the scheme rules.
Vesting percentage A percentage used to determine a scheme member's benefits upon termination of service with an employer. In the case of an MPF scheme, if the employer has made voluntary contributions for the employee, a vesting percentage on the accumulated account balance attributable to the voluntary contributions made by the employer will usually be applied based on such criteria as the member’s age or years of service.
Voluntary contribution The amount of contributions paid by employers, employees or self-employed persons to an MPF scheme exceeding the amount of mandatory contributions required to be paid under the MPF legislation.

Last Revision Date: 29/03/2017