New documentation & notification requirements under ORSO

The Occupational Retirement Schemes (Amendment) Ordinance 2020 (Amendment Ordinance) became effective on 26 June 2020. The Amendment Ordinance stipulated certain new documentation and reporting requirements for registered and exempted schemes under the Occupational Retirement Schemes Ordinance (ORSO) to ensure they are genuinely employment-based. It also improved the regulatory governance of the ORSO schemes under the Mandatory Provident Fund Schemes Authority (MPFA).

New documents required for submission

Transitional arrangements

There are transitional arrangements for the submission:

• For ORSO registered schemes which financial year begins before 26 June 2020, the relevant employers are not required to submit an annual written statement for that financial year. Employers, however, should make such submission starting from the next financial year.
• For ORSO exempted schemes which date of the exemption certificate or an anniversary of such date is before 26 June 2020, the relevant employers are not required to submit the annual report in respect of the 12-month period beginning on either of the said dates. Note that employers are still required to provide relevant documentary evidence to prove the eligibility for the registration or approval of the scheme or as verification of the membership statement for that period. The annual report will be required in respect of the next 12-month period.

Notification of reportable events (for ORSO registered schemes)

Employers or administrators of ORSO registered schemes who become aware of any ‘reportable event’ which occurs on or after 26 June 2020 must give written notice to the MPFA providing particulars of such event within 7 working days and keep a record of the particulars.

‘Reportable event’ includes but not limited to:

• failure to comply with requirements on accounts and records keeping, funding, asset management, trusteeship, investment or scheme conditions imposed by the MPFA; and
• situations where the terms of the scheme allow non-eligible persons to be scheme members or where not all members are eligible persons, etc.

Employers and administrators should be mindful of the need to comply with the notification requirement.

A form ‘Notice of Reportable Events by the Relevant Employer or Administrator of a Registered Scheme’ is required to be completed and sent by email to orsoesubmission@mpfa.org.hk.

Comment

The new document and notification requirements reflect the tightened governance under the ORSO. On a more general note, the MPFA is now empowered under the ORSO to take actions against non-compliant employers for operating non-registered scheme, breaching membership requirement for registered or exempted schemes, and failing to notify the change of name or employer or administrator of a scheme, etc. Employers/Administrators should therefore review the terms of the existing ORSO schemes (including the trust deed or insurance policy) and ensure compliance with the new requirements.