Supervision

MPF Intermediaries

Regulation

Types of MPF Intermediaries


There are two types of MPF intermediaries: principal intermediaries and subsidiary intermediaries.

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Permitted regulated activities of principal intermediaries

MPFA is authorized to register any of the following business entities (i.e. Type A regulatees) as a principal intermediary (PI) for carrying on regulated activities:


  1. an authorized financial institution registered under the Securities and Futures Ordinance (SFO) for Type 1 regulated activity (dealing in securities) or Type 4 regulated activity (advising on securities), or both;
  2. a corporation licensed under the SFO to carry on Type 1 regulated activity (dealing in securities) or Type 4 regulated activity (advising on securities), or both;
  3. a company authorized under the Insurance Ordinance (IO) to carry on long term insurance business; and
  4. a licensed long term insurance broker company under the IO. 
Permitted regulated activities of subsidiary intermediaries
MPFA is authorized to register any of the following persons (i.e. Type B regulatees) who fulfils the relevant requirements as a subsidiary intermediary (SI) for carrying on regulated activities on behalf of a PI:

 

  1. an individual licensed under the SFO to carry on Type 1 regulated activity (dealing in securities) or Type 4 regulated activity (advising on securities), or both;
  2. an individual registered under the Banking Ordinance to carry on Type 1 regulated activity (dealing in securities) or Type 4 regulated activity (advising on securities), or both; and
  3. a licensed long term individual insurance agent, a licensed long term insurance agency or a licensed long term technical representative under the IO.

What are regulated activities?


All persons who engage in MPF sales and marketing activities are required to register with MPFA as an MPF intermediary before they can engage in such activities.

 

Registration with MPFA is required for all persons who engage in any of the following MPF sales and marketing activities (i.e. regulated activities) in the course of their employment, conducting business or for reward:

 
  1. inviting or inducing, or attempting to invite or induce, another person to make specific decisions on managing his/her MPF; or
  2. giving “regulated advice” (i.e. advice about making specific decisions on managing his/her MPF) to another person.
     

“Regulated advice” is the advice on any of the following matters: 


  1. joining a particular MPF scheme;
  2. participating in a particular MPF scheme as an employer;
  3. paying contributions (including voluntary contributions) to a particular MPF scheme, or investing in a particular fund of a particular MPF scheme, and the amounts to be contributed/invested;
  4. transferring MPF from a particular MPF scheme to another, or from a fund of a particular MPF scheme to another fund of the same scheme, and the amounts to be transferred;
  5. transferring benefits from an occupational retirement scheme to a particular MPF scheme and the amounts to be transferred; and
  6. whether, or when, to make a claim for payment of MPF from a particular MPF scheme, and the amount of such a claim.

Regulatory approach


MPFA is the authority responsible for registering MPF intermediaries, issuing guidelines on compliance with statutory requirements, and imposing disciplinary sanctions for non-compliance.


The Monetary Authority (MA), the Insurance Authority (IA) and the Securities and Futures Commission (SFC) are given the statutory role of frontline regulators to supervise and investigate MPF intermediaries whose core business is in the banking, insurance and securities sectors respectively.


MPFA relies on these regulators to supervise MPF intermediaries under their respective regimes.


MPF intermediaries who carry on MPF sales and marketing activities as their secondary line of business (in addition to their primary line of business in the banking, insurance and/or securities sectors) will be supervised by the MA, the IA and the SFC respectively.

Guidelines on Conduct Requirements for Registered Intermediaries


The Guidelines on Conduct Requirements for Registered Intermediaries provide guidance on the minimum standards of conduct expected of MPF intermediaries who engage in conducting MPF sales and marketing activities and giving advice in relation to MPF schemes.