Hong Kong Regulations

DEPOSIT PROTECTION SCHEME (REPRESENTATION ON SCHEME MEMBERSHIP AND PROTECTION OF FINANCIAL PRODUCTS UNDER SCHEME) RULES - SECT 6

Disclosure as to financial products offered on or after commencement of these Rules

(1) This section applies where a financial product offered by a Scheme member
on or after the commencement of these Rules is not a protected deposit but was
described as a deposit in any advertisement, promotional material or document,
whether published by electronic, telecommunications or other means.

(2) Where the financial product is a bearer instrument, the Scheme member
shall include in the bearer certificate a statement that the financial product
is not a protected deposit and is not protected by the Scheme.

(3) Subject to subsection (4), where the financial product is not a bearer
instrument, the Scheme member shall, before a person opens an account with the
Scheme member for the purpose of the financial product or invests in the
financial product—

   (a)  if the financial product is offered to the person by telephone or
        electronic mail transmission or through the Internet, notify the
        person in accordance with subsection (5) that the financial product is
        not a protected deposit and is not protected by the Scheme; or

   (b)  if the financial product is offered to the person by any other means,
        notify the person in accordance with subsection (6) that the
        financial product is not a protected deposit and is not protected by
        the Scheme.

(4) The Scheme member is not required under subsection (3) to notify a person
in respect of the financial product before the person invests in the
financial product—

   (a)  if—

        (i)    the person maintains an account with the Scheme member for the
               purpose of the financial product;

        (ii)   the Scheme member has, before the person opens the account,
               notified the person in respect of the financial product under
               that subsection; and

        (iii)  the financial product is to be invested under that account; or

   (b)  if—

        (i)    the person has maintained an account with the Scheme member for
               the purpose of the financial product before the commencement of
               these Rules;

        (ii)   the Scheme member has notified the person in respect of the
               financial product under section 5(2); and

        (iii)  the financial product is to be invested under that account.

(5) The notice given under subsection (3)(a) is required to be accompanied by
a request to the person to acknowledge, before he invests in the
financial product, in writing or by the means in which the offer is made, that
he has received and understands the notice.

(6) The notice given under subsection (3)(b) is required—

   (a)  to be in writing; and

   (b)  to be accompanied by a written request to the person to acknowledge,
        before he opens the account or invests in the financial  product, in
        writing, that he has received and understands the notice.

(7) In this section, "financial product" (金融產品) does not include a
deposit specified in section 1(e), (f), (g) or (h) of Schedule 1 to the
Ordinance.

"financial product" (金融產品)