XN000022-1992-04-29 — Page 8

WEDNESDAY, APRIL 29, 1992

MR NENDICK SAID THE TWO INTO THE BILL IN THE LIGHT OF PROFESSIONAL BODIES.

NEW PROVISIONS WERE

INCORPORATED

MARKET PRACTICE AND ADVICE FROM

THAT THESE

ON THE "POOLED" RETIREMENT SCHEMES, HE EXPLAINED WERE COVERED BY A MASTER TRUST DEED OR INSURANCE POLICY, WITH THEIR ASSETS POOLED TOGETHER FOR INVESTMENT AND ADMINISTRATION PURPOSES.

HE SAID THERE WERE A CONSIDERABLE ESTABLISHMENTS IN HONG KONG.

NUMBER OF SMALL

WHERE THESE HAVE RETIREMENT BENEFITS FOR EMPLOYEES THEY ARE GENERALLY PROVIDED THROUGH "POOLED" RETIREMENT SCHEMES.

MR NENDICK SAID A SIMPLIFIED REGISTRATION SCHEMES WOULD THEREFORE BE USEFUL.

PROCESS FOR SUCH

THE BILL PROVIDES THAT APPLICATIONS FOR REGISTRATION OF INDIVIDUAL PARTICIPANT SCHEMES WILL ONLY NEED TO BE ACCOMPANIED BY A MASTER STATEMENT FROM THE SOLICITOR AND A MASTER. REPORT FROM THE AUDITOR, SUBJECT TO CONFIRMATION BY THE SCHEME ADMINISTRATOR THAT THE SCHEME IS PART OF THE POOLING AGREEMENT.

ON FUNDING REQUIREMENTS FOR DEFINED BENEFIT SCHEMES, MR NENDICK' SAID ACTUARIAL REVIEWS OF THESE SCHEMES WERE CONDUCTED EVERY THREE YEARS.

"IF UPON REVIEW A SCHEME IS FOUND TO HAVE A SHORTFALL, IT IS A GENERAL RULE THAT THE EMPLOYER MUST TOP UP THE SCHEME SO THAT THE SHORTFALL IS REMOVED WITHIN THREE YEARS FROM THE DATE OF THE REVIEW.

"IF IT WERE TO REMAIN INSOLVENT AFTER THE THREE YEARS, IT WOULD BE LIABLE TO DEREGISTRATION," HE SAID.

THAT

SINCE THERE MAY BE FACTORS OUTSIDE THE CONTROL OF THE EMPLOYER PREVENT A SCHEME FROM ATTAINING SOLVENCY WITHIN THE THREE-YEAR PERIOD, THE ACTUARIAL ASSOCIATION SUGGESTED THAT SOME FLEXIBILITY SHOULD BE PROVIDED BEFORE THE PROVISIONS FOR DEREGISTRATION ARE TRIGGERED.

"AS A

RESULT, THE BILL NOW ALLOWS A FURTHER PERIOD

OF THREE YEARS WHERE A CONTINUING SHORTFALL ARISES FROM FACTORS BEYOND THE CONTROL OF THE EMPLOYER.

"WHERE, HOWEVER, ANY PART OF THIS SHORTFALL ARISES FROM A FAILURE OF THE EMPLOYER TO IMPLEMENT THE ACTUARY'S RECOMMENDATIONS THE GENERAL RULE WILL APPLY, MR NENDICK SAID.

THE BILL ALSO HAS OTHER IMPROVEMENTS INCLUDING THE STRENGTHENING OF THE PROVISIONS RELATING TO THE WINDING UP OF A

SCHEME.

THE BILL NOW INCLUDES STATUTORY GUIDELINES FOR THE ORDER THE WINDING UP OF A SCHEME DOMICILED IN HONG KONG DIRECTIONS ON THE DISTRIBUTION OF ITS ASSETS.

COURT ΤΟ AND GIVE

/ON PROVISIONS