Hong Kong Regulations

MANDATORY PROVIDENT FUND SCHEMES (GENERAL) REGULATION - SECT 44

Approved trustee to appoint investment manager

(Past version on 01/04/2003).
(Past version on 23/06/2000).
(Past version on 03/08/1999).

(1) The approved trustee of a registered scheme must ensure that-

   (a)  an investment manager is appointed to manage the investment of the
        funds of the scheme; and

   (b)  the contract for the appointment of the investment manager complies
        with Schedule 2.

(2) The trustee does not have to comply with subsection (1) in relation to a
constituent fund of the scheme if-

   (a)  the accrued benefits of the constituent fund are invested only in a
        single approved pooled investment fund, or in a single approved 
        index-tracking collective investment scheme, that is specified in the
        offering document; or

   (b)  the trustee has obtained the prior approval of the Authority that
        compliance with subsection (1) is not required in relation to the
        fund. (1 of 2008 s. 35)

(3) A person is eligible to be appointed as an investment manager only if the
person-

   (a)  is a company incorporated in Hong Kong; and

   (b)  has a paid up share capital of not less than $10000000 and net  assets
        of at least the same amount; and

   (c)  is a corporation licensed to carry on, or an authorized 
        financial institution registered for carrying on, a business in asset
        management under Part V of the Securities and Futures Ordinance ( Cap 
        571). (5 of 2002 s. 407)

(4) In appointing an investment manager, the trustee must ensure that-

   (a)  the selection and appointment of the investment manager is recorded in
        writing; and

   (b)  there is no conflict of interest between the investment manager and
        other persons who have a contractual relationship with the trustee, or
        any other trustee, that could prejudice the interests of scheme
        members; and

   (c)  the investment manager has the resources (including human resources)
        necessary to carry on business as an investment manager; and

   (d)  the investment manager has in place adequate controls and safeguards
        with respect to the investment of funds of the scheme so as to ensure
        that the interests of scheme members will be properly protected.

(5) The trustee may appoint a person as an investment manager in respect of
the scheme only if the person is independent of the trustee and of the
custodian of the scheme assets and of any delegate of the custodian. (L.N. 223
of 2000)

(6) In subsection (2), "approved index-tracking collective investment scheme"
(核准緊貼指數集體投資計劃) means an index-tracking collective
investment scheme within the meaning of section 1 of Schedule 1 that is
approved by the Authority for the purposes of section 6A of that Schedule. (1
of 2008 s. 35)

"approved index-tracking collective investment scheme"
(核准緊貼指數集體投資計劃)