Government to legislate MPF intermediary rules, paving way for semi-portability

The government will legislate to regulate MPF intermediaries’ sales and marketing, with the proposals going to LegCo’s financial affairs panel on the 4th of next month. If progress is smooth, legislation could complete by mid-next year — giving workers choosing their own MPF plans proper protection.

What’s in the legislation?

A complaints channel; serious breaches risk de-registration. Members unhappy with sales tactics can complain to the MPFA, which coordinates and refers cases to the relevant regulator; the new law empowers regulators to punish rogue intermediaries, with the MPFA able to revoke licences in serious cases. As of end-February, Hong Kong had 475 registered MPF corporate intermediaries and 28,365 individual ones — 70% insurance, 28% banking, 2% securities.

“One trade, three regulators” stays. Under today’s administrative setup, MPF business is overseen by the HKMA, Insurance Authority and SFC. MPFA chief executive Diana Chan said legislation will give the MPFA and frontline regulators statutory enforcement and disciplinary powers. Permanent Secretary Au King-chi explained the three intermediary types work in different environments and conduct regulation matters most; memoranda of understanding will keep enforcement consistent. The life-insurance federation worries different regulators might interpret the same sales practice differently and hopes the appeal mechanism works; the banking association backs keeping the familiar arrangement.

Tougher penalties for defaulting employers?

Defying a court order to pay becomes a crime. The amendments also strengthen deterrence: missing the contribution deadline becomes a continuing offence, and failing to pay per a tribunal or court order becomes an offence too.

MPFA complaint flow: member complains to MPFA → MPFA assesses and refers to the relevant regulator → regulator investigates and disciplines (may recommend suspension/revocation) → MPFA suspends/revokes in serious cases.

To pick the right provider under semi-portability, visit MPF fund comparison.