Once a retirement scheme has been registered under ORSO, it must comply with ORSO requirements, which include (but are not limited to):
Except in special circumstances specified by ORSO, the assets of a scheme must be kept separate and distinct from, and must not form part of:
The assets of a registered scheme must only be applied for the purposes of the scheme.
In the case of a scheme governed by a trust, there should be at least one independent trustee who must not be the employer himself, his employee or an associate (as defined in ORSO) unless such associate is a trust company registered under the Trustee Ordinance (Chapter 29, Laws of Hong Kong).
Any loan to the relevant employer of a scheme, or to his associate out of the scheme's assets, is prohibited. Not more than 10% of the assets of the scheme should consist of restricted investments as defined under ORSO.
Subject to the extent allowed under ORSO, no asset of the scheme acquired on or after 15 October 1993 should consist of investments in the share capital of a body corporate, which is neither listed on a recognized stock market as defined in the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong), nor publicly listed on a specified stock exchange.
Subject to the provisions of ORSO, the assets of a registered scheme should be sufficient to meet its aggregate vested liability. Such a scheme should be funded in accordance with the terms of the scheme and (where the scheme is a defined benefit scheme) the recommendations, if any, contained in the actuarial certificate.
The administrator of a registered scheme is required by ORSO to keep proper accounts and records regarding all assets, liabilities and financial transactions of the scheme. In addition, the administrator is also responsible for preparing financial statements as soon as reasonably practicable after each financial year of the scheme, and providing such statements to an independent auditor to allow the auditor to prepare a report on the accounts.
Relevant employers are required to appoint an auditor to carry out an audit and give a statement to the administrator's auditor regarding the making of contributions to the scheme. This statement from the employer’s auditor must be sent to the administrator’s auditor not later than four months after each financial year of the scheme. For details, please refer to Guidelines on the Statement of the Employer's Auditor.
In respect of a defined benefit scheme, actuarial reviews must be undertaken by an actuary once every three years to ascertain the financial position of the scheme. If the actuary finds that the scheme is insolvent, an annual actuarial review is required. An actuary who prepares the actuarial certificate in respect of a scheme must not be (a) the relevant employer of the scheme; (b) an associate or employee of the employer; or (c) a person having a contract of service with an employee referred to in (b).
If an ORSO registered scheme is terminated during a financial year, MPFA requires the annual return, audited financial statements and auditor’s report to report on the scheme’s position up to the later of the following dates:
The relevant employer of an ORSO registered scheme is required to provide certain information to the scheme member, such as relevant information about the scheme and an annual statement of the member’s benefit entitlement under the scheme.
Scheme members or a registered scheme’s consultative committee have the right to request certain information from the relevant employer or the scheme’s designated person. The consultative committee can be formed by election amongst scheme members if the scheme has more than 20 members and the majority of the scheme members agree to its formation.
The Registrar must be notified of the following changes within one month of such changes:
Any changes in the scheme’s domicile shall also be notified to the Registrar as soon as reasonably practicable.
The relevant employer shall pay an annual fee of $2,400 for an individual scheme and $1,200 for a pooled scheme. This should be paid within one month after the annual due date, which means the last day of each period of 12 months during which the scheme continues to be a registered scheme and beginning on the first or any subsequent anniversary of its registration. If the fee is not paid within one month after the due date, a surcharge equal to the amount of the unpaid fee will be imposed.
In the event that a registered scheme is terminated or wound up, the relevant employer and designated person of the scheme shall, within 14 days of the commencement of the winding up or termination process, give notice in writing of that fact to the Registrar and each member of the scheme.
For more details, please click to view A Guide to the Occupational Retirement Schemes Ordinance.
In addition to the above, an MPF exempted ORSO registered scheme (i.e. an ORSO registered scheme granted with an MPF exemption certificate) must also comply with the following:
Before the commencement of the MPF System, employers who had applied for an MPF exemption certificate were required to provide a one-time option to existing ORSO scheme members to remain in the ORSO scheme or become members of an MPF scheme. Since the commencement of the MPF System, these employers are required to provide a one-time option to new eligible employees (if applicable) to choose between the ORSO scheme and an MPF scheme.
In the event that a relevant employer decides to reduce members’ future benefits or rights under an ORSO scheme, the employer must provide each member the option of instead joining an MPF scheme.
|1.||In the case of a company incorporated in Hong Kong, it shall be a registered trust company;|
|2.||In the case of a company incorporated outside Hong Kong, it shall satisfy MPFA that:|
|1.||In the case of a non-employer trustee, he must satisfy MPFA that:|
When the trustees of a scheme are all individuals, upon any retirement of an existing trustee or appointment of a new trustee, there must be not less than two trustees, of whom not less than one must be a non-employer trustee who complies with the requirements of (1) above.
Any director of a company which is a trustee of a scheme, other than a trustee covered in “Trustee which is a company” above, must satisfy MPFA:
A person who has a duty or power to retire or appoint the trustee of a scheme shall obtain MPFA’s approval before retiring or appointing the trustee. In the case of a trustee which is a company and not a registered trust company, or a trustee which is a company incorporated outside Hong Kong and not comparable to a registered trust company, the trustee shall obtain MPFA’s approval in writing before retiring or appointing a director of the trustee.
Application for pre-approval of the appointment of a trustee or a director of a trustee should be made in writing to MPFA together with a prescribed form.
No person shall be appointed to be the investment manager of a scheme except an investment management company that is:
|i.||a corporation licensed to carry on, or an authorized financial institution registered for carrying on, a business in asset management under Part V of the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong); or|
|ii.||a company authorized by an authority recognized by MPFA to carry on, under the law of a place outside Hong Kong, the business referred to in (i).|
|(a)||paying accrued benefits to or in respect of scheme members, and then only if:|
|(b)||settling transactions involving the acquisition or disposal of securities or other investments relating to the scheme, and then only if:|
An application shall be made by the relevant/representative employer in the prescribed format (i.e. Form WD-ER).
The relevant employer is also required to:
Last Revision Date: 16/08/2013