Hong Kong Regulations

MANDATORY PROVIDENT FUND SCHEMES (GENERAL) REGULATION - SECT 72

Subcustodial agreement

(Past version on 03/08/1999).

(1) Any agreement entered into between a custodian of scheme assets and
another person providing for any of the custodian's functions to be delegated
to that other person must include the same requirements as those specified in
Schedule 3. For the purpose of applying Schedule 3 to the agreement,
references to the trustee are to be construed as references to the custodian
and references to the custodian are to be construed as references to the
delegate. (2 of 2002 s. 21)

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

   (a)  if the custodian of scheme assets is appointed under section  50 (1),
        the contract for the appointment prohibits the custodian from entering
        into an agreement with a person providing for any of the custodian's
        functions to be delegated to that person unless the agreement complies
        with subsection (1);

   (b)  if the trustee is the custodian of the scheme assets in accordance
        with section 50(2), the trustee does not enter into an agreement with
        a person providing for any of the custodian's functions to be
        delegated to that person unless the agreement complies with subsection

(1). (2 of 2002 s. 21)

(3) The approved trustee of a registered scheme who, without reasonable
excuse, fails to comply with a requirement imposed on the trustee by
subsection (2) commits an offence and is liable on conviction to a fine at
level 5. (2 of 2002 s. 21)