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The Mandatory Provident Fund Schemes Authority (MPFA) has decided to set December 1, 2000 as the target date for commencing MPF contributions.

The Executive Council was informed of the MPF implementation timetable at its meeting today (Tuesday).

Chairman of the MPFA, Mr Charles Lee Yeh-kwong, said: "To achieve the target of launching MPF on December 1, 2000, one of MPFA's most important tasks is to conduct the licensing exercise in the second half of this year. This will include the approval of trustees and investment products and the registration of provident fund schemes."

According to the timetable, the MPFA will receive formal applications for licensing in August this year and complete vetting of all licensing applications by year end. This should leave sufficient time for employers to apply for MPF exemption in respect of eligible schemes governed by the Occupational Retirement Schemes Ordinance (ORSO).

The MPFA will receive exemption applications from January 3, 2000 to May 3, 2000 and aim to complete vetting of all the applications before July 2000.

The timetable also allows an 11-month period for employers to enrol their staff into MPF schemes before the commencement of contributions in December 2000.

Mr Lee said, "The implementation timetable was based on the results of a recent progress review of the necessary preparatory work and extensive consultation with the industry, employer groups as well as the MPF Schemes Advisory Committee.

"The overall progress of the preparatory work has been satisfactory. We believe that the timetable is realistic and should be achievable by all parties concerned."

He added that since the launching of MPF would affect many parties including the industry, employers and employees, the MPFA would monitor closely all aspects of the preparatory work, particularly the development of the MPFA's Information Management System, and keep the implementation timetable under constant review.

At its meeting this morning, the Executive Council endorsed a Commencement Notice which will bring into effect further provisions in the MPF Schemes Ordinance, enabling the MPFA to make financial arrangements for its operation as from March 12, 1999, commence the licensing exercise on August 3, 1999 and start processing exemption applications of ORSO schemes from MPF requirements from January 3, 2000.

The Executive Council also endorsed the making of the MPF Schemes (Fees) Regulation which will be submitted to the Legislative Council for approval shortly.

In the light of the current economic situation, the MPFA proposed in the Fees Regulation not to charge the annual registration fee of MPF schemes for the first two years and to fix the applications fees on the basis of comparable fees charged by other financial services regulators.

END/Tuesday, March 9, 1999