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Financial and Monetary Affairs

interests of scheme members. The MPFA monitors MPF trustees and other service providers, investigates cases of non-compliance, conducts proactive inspections, and takes enforcement action where necessary. It also arranges programmes to strengthen scheme members' understanding of the MPF System, publicise significant changes to the system and educate scheme members on practical issues about managing MPF investment. The MPFA's operations are primarily financed by investment returns generated from a one-off Capital Grant of $5 billion from the government.

Recent Developments

Legislation to raise the monthly minimum RI level from $6,500 to $7,100 and the monthly maximum RI level from $25,000 to $30,000 were passed by the Legislative Council in 2013. The new minimum RI level took effect on 1 November and the new maximum RI level will take effect on 1 June 2014. A review of the statutory adjustment mechanism of the minimum and maximum RI levels is under way and views of key stakeholders have been sought. A simplified MPF contribution calculation method and a unified contribution scale for casual employees and their employers under Industry Schemes also took effect on 1 November 2013.

A bill will be introduced into the Legislative Council in 2014 to increase flexibility of withdrawal of MPF accrued benefits and improve the withdrawal process, and facilitate the implementation of short-term measures to streamline administrative procedures of MPF schemes.

The MPFA is taking forward short-term measures to enhance the efficiency of the MPF System. These include measures to standardise, simplify and automate administrative MPF schemes' procedures (worked out with the MPF industry), the development of an electronic payment and settlement system to facilitate transfers of MPF accrued benefits among trustees, actions by trustees to consolidate small scale or less efficient MPF schemes and funds, and provision of low-fee MPF funds. In the one year since 1 November 2012, 145 MPF funds had reduced fees. By early 2014, all MPF schemes are expected to have low-fee funds (charging a management fee of 1 per cent or below or a fund expense ratio of 1.3 per cent or below) that invest in equities and/ or bonds.

The MPFA is also conducting studies to support long-term reforms of the MPF System, including full portability of MPF accrued benefits and the provision of a core fund in each MPF scheme as the default fund. The core fund will be subject to fee control and based on a long-term

investment strategy.

Companies Registry

The Companies Registry administers and enforces most parts of the Companies Ordinance. The registry records local and non-Hong Kong companies and documents required to be filed under the Companies Ordinance and related ordinances, de-registers defunct solvent private companies and provides the public with services and facilities for inspecting and obtaining company information kept by the registry. It administers and enforces several other ordinances, including the Trustee Ordinance (insofar as it relates to trust companies), the Registered Trustees Incorporation Ordinance and the Limited Partnerships Ordinance. The registry is also

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