Hong Kong people eligible to participate in Mainland social insurance scheme

On 29 November 2019, the National Healthcare Security Administration and the Ministry of Human Resources and Social Security released the “Interim Measures for Hong Kong, Macau and Taiwan Residents to Participate in the Mainland Social Insurance Scheme” (香港澳門台灣居民在內地(大陸)參加社會保險暫行辦法) (Interim Measures). This will come into effect on 1 January 2020. According to the Interim Measures, Hong Kong residents who work, live and study in the Mainland will be given social insurance cards. Like the Mainland residents, they will have the right to participate in social insurance scheme in the Mainland and enjoy social insurance benefits.

Eligibility, procedures and entitlements

The Interim Measures set out four classes of individuals who are eligible to participate in the different kinds of Mainland social insurance schemes:-

1. 

Hong Kong residents who are legally employed or recruited by employing units such as enterprises, institutions, social organizations, individual economic organizations with employees registered in the Mainland shall take part in employee basic pension insurance, employee basic medical insurance, work injury insurance, unemployment insurance and childbirth insurance;

2. 

Hong Kong residents carrying out sole proprietorship business in accordance with PRC law, together with those holding Mainland Residence Permits and having flexible employment arrangements may take part in employee basic pension insurance and employee basic medical insurance in accordance with applicable regulations in the place of registration or living (as the case may be);

3. 

Hong Kong residents living in the Mainland with Mainland Residence Permits who are not working may take part in basic pension insurance and basic medical insurance for rural residents and non-working urban residents in accordance with applicable regulations in the place of living; and

4. 

Hong Kong residents studying in Mainland universities are subject to the same medical protection policies as Mainland students may take part in basic medical insurance for rural residents and non-working urban residents by following applicable regulations in the place of the tertiary education institution.

With the view to equalising treatment between Hong Kong and Mainland residents, the Interim Measures provide that the steps for enrolling Hong Kong residents into Mainland social insurance schemes shall be the same as that applicable to Mainland residents. Further, Hong Kong residents participating in social insurance scheme are entitled to applicable benefits and privileges under the law.

Special policies facilitating geographical mobility

The Interim Measures also introduce, among other items, various policies in relation to pension insurance to facilitate movement across provinces or in and out of the Mainland:-

1.

The procedures for Hong Kong residents working across different provinces to collect pensions under their employee basic pension schemes are determined by reference to the length of periods for which the individual makes contribution payments in each of the various places;

2. 

Where a Hong Kong resident leaves the Mainland before the conditions for pension entitlement are satisfied, the individual may elect to either preserve or terminate his or her social insurance accounts. If the account is preserved, when the individual decides to work or live in the Mainland again, the length of the payment period of his/her previous stay in the Mainland can be aggregated for determining the individual’s pension entitlement; and

3. 

Where the aggregate contribution payment period for a Hong Kong resident is less than 15 years (the requirement for pension entitlement) when he/she attains statutory retirement age, he/she may extend the payment period or make a lump sum payment in accordance with relevant regulations to satisfy the 15-year requirement.

Preventing double-contribution

To relieve the burden of Hong Kong residents who are under contribution obligations under similar schemes in Hong Kong, the Interim Measures provide that Hong Kong residents who decide to preserve their social insurance relationship in Hong Kong are exempt from participating in pension insurance and unemployment insurance in the Mainland.

Takeaway

The Interim Measures are seen as a positive step toward offering Hong Kong people the same treatment as local people when they develop their careers, start their businesses, or pursue their studies in the Mainland. It is expected that the Interim Measures will facilitate the movement of Hong Kong people to the Mainland for the development of the Guangdong-Hong Kong-Macao Greater Bay Area initiative as well as pursuant to other national development strategies. However, the Interim Measures will need to be supplemented by future local regulations and practical guidance before it can be fully and effectively implemented. Businesses should keep abreast of future developments.