If the following criteria are met, you are entitled to choose between joining an MPF scheme or an MPF exempted ORSO scheme:
- your employer operates both an MPF scheme and an MPF exempted ORSO scheme;
- you are a new eligible employee; and
- the governing rules the ORSO scheme opens membership to new eligible employees.
Under these circumstances, your employer must give you a one-time option to choose between joining the MPF scheme and the MPF exempted ORSO scheme, and provide the necessary information to help you decide.
For more details, please refer to here.
Your employer must give you a one-time option within the first 10 days of your employment and provide you with information on both schemes to help you make an informed decision. The information includes:
- the law of which governs the scheme;
- contribution arrangements;
- salary definition;
- the name of the scheme trustee(s); and
- vesting rights, portability and preservation of benefits under the schemes.
Before making a decision, you should fully understand the information provided. Please refer to Comparative Information of MPF exempted ORSO Schemes and MPF Schemes.
Your employer must enrol you in a scheme within the first 60 days of your employment. If you do not notify your employer in writing within the first 30 days of employment, you will be deemed to have chosen to join an MPF scheme.
Members of ORSO registered schemes and the scheme's advisory committee can obtain the following information from the scheme administrator:
- information on membership criteria and conditions, the calculation method of contributions, the benefits payable and payment conditions, a copy of the latest version of the scheme's governing rules, the latest audited accounts of the scheme and the auditor’s report, and the latest actuarial certificate for the scheme (if any);
- information on any amendments made to the scheme; and
- information on the aggregate market value of the scheme's total assets and details of its investments.
In addition, members of a ORSO registered scheme may obtain/enquire about the following information from their employers:
- notifications of amendment of the scheme ;
- information about the criteria and conditions for scheme membership, the calculation method for contributions, the payable benefits and the conditions of benefit payment;
- annual statement within six months after the end of the financial year of the scheme, which sets out the member's existing benefits under the scheme and the expected benefits that can be received at the time of retirement based on his years of service;
- within three months after the termination of employment, a member can give the employer a written request to provide a detailed description of the member’s benefits under the scheme;
- details of the scheme administrator or designated person of the offshore scheme upon written request; and
- members and addresses of the consultative committee (if any) upon written request.
The legislation stipulates that the accrued benefits of members who joined an ORSO scheme after the launch of the MPF system on 1 December 2000 (i.e. new members) are subject to preservation, portability and withdrawal requirements up to an amount equivalent to the MMB.
For new scheme members, MMB refers to the smaller of the following:
(a) the accrued benefits held by the member under the scheme during the period when the MPF Exemption Certificate is applied to the scheme (which for this purpose refers to the post-MPF years of service); and
(b) 1.2 × final average monthly relevant income × years of post-MPF service.
For details, please refer to Preservation and Withdrawal requirements of Minimum MPF Benefits.
If you are a new member (i.e. a member who joined an ORSO scheme after 1 December 2000) of an MPF exempted ORSO registered scheme, your benefits under the scheme will subject to preservation, portability and withdrawal requirements under the legislation.
The Preservation Requirement
Unless permitted by legislation (e.g. when new members reach the retirement age of 65), the trustee of an MPF exempted ORSO registered schemes must not pay out any part of the MMB to any new members, or dispose of any part of the MMB by transferring it in other forms to new members. The trustee is also not allowed to forfeit the MMB of new members who are dismissed with cause. (Note: this requirement also applies to existing members who joined an ORSO scheme on or before 1 December 2000. But existing members may withdraw and be paid the MMB in accordance with the governing rules of the scheme.)
The MMB shall not be used to pay an employer for losses caused by a new member, nor shall it be used to repay debts owed to the employer by the new member.
The Portability Requirement
When a new member is entitled to receive benefits under an MPF exempted ORSO registered scheme, the trustee of the scheme should, in accordance with the governing rules of the scheme, transfer the MMB of the member as soon as reasonably practicable:
a. to an MPF scheme in which the member’s new employer is a participating employer; or
b. to a master trust scheme or an industry scheme, designated by the member, that accepts MMB transfers.
The Withdrawal Requirement
New members can only withdraw the MMB under the following circumstances:
• reaching retirement age of 65;
• early retirement at age 60 or above;
• permanent departure from Hong Kong;
• total incapacity;
• terminal illness;
Existing members of an MPF Exempted ORSO registered scheme (i.e. employees who joined the scheme on or before 1 December 2000) are exempt from the preservation, portability and withdrawal requirements.
For details, please refer to Preservation and Withdrawal Requirements of Minimum MPF Benefits.
For a scheme member who is an existing member of an MPF exempted ORSO registered scheme (the "old scheme") and who is being transferred to a new scheme, where the new scheme is –
(a) a successor scheme established in accordance with the legislation;
(b) operated by the same employer of the old scheme;
(c) operated by a different employer in the circumstances specified by the legislation; or
(d) operated by an associated company in the circumstances specified by the legislation ;
Under these circumstances, the member shall be treated as an existing member of the new scheme if –
• no benefits from the old scheme have been or will be paid to existing the member as a result of the transfer;
• an amount not less than the existing member's past service liability has been or will be transferred from the old scheme to the new scheme as a result of the transfer;
• immediately after the transfer, the value of vested benefits and past service liability (referred to as "benefits") the existing member is or will be entitled to receive from the new scheme will not be less than the value of benefits the member is entitled to under the old scheme immediately before the transfer;
• while existing members are still members of the old scheme, their employment period is recognised by the new scheme; and
• in any event where Section 70A(6)(a) or (b) of ORSO is applicable to the transfer, the section has been complied with and no benefits held in an ORSO scheme for the existing member have been paid to the existing member or the employer of the old scheme, in accordance with Section 70A(6) of ORSO.
If your employer has paid you SP or LSP or a part of it in accordance with the Employment Ordinance (Chapter 57, Laws of Hong Kong), the employer may apply to the administrator of the ORSO scheme for a payment equivalent to the SP or LSP. The amount must not exceed the total amount of employee's vested benefits derived from the employer's contributions.
With regard to MPF exempted ORSO registered schemes, an employer is allowed to use part of a new member's benefits derived from the employer's contributions (including the MMB) to offset the SP or LSP the member is entitled to.
For details, please refer to V.4 Guidelines on MPF Exempted Occupational Retirement Plans-Preservation of Benefits
For details on the calculation basis and payment time for SP or LSP, please refer to the relevant provisions of the Employment Ordinance.
With effect from 1 January 2020, when new employees enrol into ORSO registered schemes, new employees are required to submit self-certification for verification his/her tax residency status. Otherwise, the account opening process will be adversely affected and could not be completed.
If you are not a tax resident in any jurisdiction outside Hong Kong, the ORSO registered scheme is not required to report your account information to the Inland Revenue Department for transmission to any jurisdiction outside Hong Kong.
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