Govt proposes to give MPFA more disciplinary power by 2012

The government plans to give the MPFA more disciplinary power such as sanctions, inspections and investigations to ensure compliance by MPF intermediaries.

It follows the government’s recent consultation which found the majority of those who responded support the introduction of a statutory regime to regulate the sale and marketing of MPF products before the implementation of the Employee Choice Arrangement (ECA).

The consultation, which started on 28 March 28, received 13 written submissions.

A spokesman for the Financial Services and the Treasury Bureau (FSTB) said: "We propose to vest in the MPFA all disciplinary powers (including reprimand, fines, suspension and revocation of registration) whilst front-line regulators (FRs) would participate actively in the disciplinary process to ensure regulatory consistency."

The proposals also include the introduction of sanctions against the sales and marketing of MPF products by unregistered MPF intermediaries, and empowering regulators to conduct inspection and investigation and take disciplinary action to ensure compliance by intermediaries.

Currently, there are about 29,000 MPF intermediaries registered with the MPFA to carrying out sales and marketing activities.

The FSTB spokesman added: "At present, the MPFA regulates MPF intermediaries through an administrative regulatory regime. The legislative proposals are modelled on the existing administrative arrangements with appropriate improvements."

The FSTB and the MPFA are proceeding with the drafting of the legislation and the Government will table the bill at the Legislative Council in Q4 2011 while eyeing the arrangements to be implemented in H2 2012.