When Will MPF Intermediaries Face Statutory Regulation?

What is the timetable for regulating MPF intermediaries?

The government said in April 2011 it aimed to complete legislation regulating MPF intermediaries by mid-2012, with implementation in the second half. Discussing tougher oversight at LegCo’s financial affairs panel, Permanent Secretary for Financial Services and the Treasury Au King-chi said the MPFA was pressing ahead with the Employee Choice Arrangement and hoped to start legislating on intermediary conduct in 2011, finishing before LegCo’s summer recess in July 2012.

How will the law handle intermediary firms’ liability?

Some lawmakers worried aggressive frontline salespeople could breach rules while their firms escaped punishment. Au replied the bill would introduce a “principal intermediary” concept: each firm must appoint a senior executive accountable for maintaining effective monitoring systems. Before switching funds, members can compare trustees and funds at MPF fund comparison.

Why the urgency?

Regulating intermediaries is a precondition for “semi-portability.” Once implemented, the sales target shifts from employers to over two million employees — without clear conduct rules, workers’ life savings could be at risk.