Glossary

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Accrued benefits

The amount of each scheme member's beneficial interest in an MPF scheme, including sums derived from the contributions made by or in respect of that scheme member, together with the income or profits arising from any investments of the contributions, but taking into account any losses in respect of the investments and any amounts paid in respect of the scheme member.

Approved pooled investment fund (APIF)

A type of investment fund that an MPF fund invests into. An APIF can be in form of an insurance policy, a unit trust or a mutual fund that complies with the requirements set out in section 17(2) of Schedule 1 of the Mandatory Provident Fund Schemes (General) Regulation and is approved by MPFA.

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. The term is usually used interchangeably with MPF trustee.

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.

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:

  1. 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
  2. Where appropriate, the qualifying service and age of the employee.
Frontline regulator (FR)

The 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.
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.

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, 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 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.

Occupational retirement scheme (ORSO scheme)

Subject to section 2(6) of the Occupational Retirement Schemes Ordinance, any scheme not being a contract of insurance under which benefits are payable only upon the death or disability of the insured, which-

  1. is comprised in one or more instruments or agreements; and
  2. 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.
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.
Permitted period

Permitted period in the context of performing enrolment for an employee/a self-employed person into an MPF scheme:

 

  1. 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;
  2. 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
  3. 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.

Self-certification

A formal declaration that account holders make in connection with their tax residence under the Automatic Exchange of Financial Account Information (AEOI) regime of the Inland Revenue Ordinance.

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.

Vesting scale

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.