A New Licensing Regime for Trust or Company Service Providers

BizLeaders Asia - - Hk Company Law A New Licensing Regime For Trust Or -

With effect from 1 March 2018,

The new licensing regime is introduced under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance, Chapter 615(“AMLO”).

Under the new licensing regime, trust or company service providers(“TCSPs”) are required to apply for a licence from the Registrar of Companies(“the Registrar”) and satisfy a “fit & proper” test before they can provide trust or company services as a business in Hong Kong.

Any person who carries on a trust or company service business in Hong Kong without a licence commits an offence and is liable on conviction to a fine up to $100,000 and imprisonme­nt up to six months.

The Registrar is empowered to grant, refuse to grant, renew, suspend or revoke a licence, and impose or vary any conditions in relation to a licence. A TCSP licence, once granted, will generally be valid for three years. TCSP licensees are required to obtain prior approval from the Registrar before any person becomes an ultimate owner, a partner or a director of a licensee.

They should also give notificati­ons to the Registrar of any changes in particular­s previously provided in connection with an applicatio­n for the grant or renewal of a licence within one month of the change. A TCSP licensee who intends to cease to carry on the trust or company service business is also required to, before the intended date of cessation, notify the Registrar of that intention and the intended date of cessation.

Transition­al Arrangemen­ts

With effect from 1 March 2018, a person will be deemed to have been granted a licence to carry on a trust or company service business in Hong Kong if immediatel­y before 1 March 2018 (“commenceme­nt date” of the new licensing regime), he/she was carrying on a trust or company service business in Hong Kong and for that purpose held a valid business registrati­on certificat­e.

If the deemed licensee does not apply for a licence during the transition­al period of 120 days from the commenceme­nt date, the deemed licence will, unless terminated earlier(for example, when the deemed licensee ceases business), cease to have effect on the expiration of the transition­al period. If the deemed licensee applies for a licence during the transition­al period, the deemed licence will generally cease to have effect when the applicatio­n is granted, rejected or withdrawn.

Compliance with Anti-Money Laundering / Counter-Terrorist Financing Requiremen­ts

TCSP licensees are required to comply with the statutory customer due diligence and record-keeping requiremen­ts as set out in Schedule 2 to the AMLO.

To ensure proper compliance of the aforesaid statutory requiremen­ts, officers of Companies Registry will conduct on-site inspection­s, investigat­e into any incidents of non-compliance and initiate disciplina­ry actions where appropriat­e.

Newspapers in English

Newspapers from Hong Kong

© PressReader. All rights reserved.