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BANKING ORDINANCE
BANKING ORDINANCE
(CHAPTER 155)
CONTENTS
Section
PART I PRELIMINARY
1. Short title
2. Interpretation
3. Application
PART II APPOINTMENTS, FUNCTIONS OF MONETARY AUTHORITY, REPORTS BY MONETARY
AUTH ORITY AND POWER OF GOVERNOR TO GIVE DIRECTIONS
4. Banking Advisory Committee
5. Deposit-taking Companies Advisory Committee
6. (Repealed)
7. Functions of Monetary Authority
8. (Repealed)
9. Reports by Monetary Authority
10. Power of Governor to give directions
PART III BANKING BUSINESS AND BUSINESS OF TAKING DEPOSITS TO BE CARRIED
ON BY AUTHORIZEDINSTITUTIONS ONLY
11. Banking business restricted to licensed banks
12. Restriction on business of taking deposits
13. Power to grant exemptions
14. Deposit-taking company not to take deposits less than specified sum
PART IV LICENSING AND REGISTRATION OF AUTHORIZED INSTITUTIONS AND
KEEPING OF REGISTER
15. Application for banking licence
16. Grant or refusal of banking licence
17. Amendment of conditions of banking licence
18. Minimum paid-up share capital for grant of banking licence
19. Banking licence fees
20. Application for registration as deposit-taking company
21. Registration or refusal of registration of deposit-taking company
22. Amendment of conditions of registration
23. Registration fees
24. Application for restricted banking licence
25. Grant or refusal of restricted banking licence
26. Restricted banking licence fees
26A. Effect of grant of licence to or registration of existing authorized
institution, etc.
27. Register of authorized institutions, etc.
28. Publication of names entered in or removed from register and
suspensions
PART V REVOCATION OF LICENCE OR REGISTRATION OF
AUTHORIZED INSTITUTION
29. Revocation of banking licence
30. Procedure on and effect of revocation of banking licence
31. Revocation of registration
32. Revocation of restricted banking licence
33. Procedure on and effect of revocation
PART VI SUSPENSION OF DEPOSIT-TAKING COMPANY AND RESTRICTED LICENCE BANK
34. Interpretation
35. Temporary suspensions
36. Suspensions
37. Opportunity of being heard
38. Effect of suspension
PART VII TRANSFER OF LICENCE OR REGISTRATION OF AUTHORIZED
INSTITUTIONS
39. Interpretation
40. Transfer of licence or registration
41. Application for transfer
42. Certificate of transfer, etc.
43. Liabilities and privileges of transferee and transferee
PART VIII LOCAL BRANCHES, LOCAL REPRESENTATIVE OFFICES AND FEES
44. Control of establishment, etc. of local branches
45. Fees in respect of local branches
46. Control of establishment, etc. of local representative offices
47. Supply of information and examination of local representative offices
48. Fees in respect of local representative offices
PART IX OVERSEAS BRANCHES, OVERSEAS REPRESENTATIVE OFFICES AND FEES
49. Control of establishment, etc. of overseas branches and overseas
representative offices
50. Conditions regarding overseas branches and overseas representative
offices
51. Fees in respect of overseas branches and overseas
representative offices
PART X POWERS OF CONTROL OVER AUTHORIZED INSTITUTIONS
52. Powers of Monetary Authority
53. Powers of Governor in Council
54. Remuneration and expenses of Monetary Authority and others in certain
cases
55. Examination and investigation of authorized institutions, etc.
56. Production of authorized institution's books, etc.
57. Control of authorized institution by the Monetary Authority
58. Authorized institution under control of Monetary Authority to co-
operate with Monetary Authority
PART XI AUDITS AND MEETINGS
59. Audit
59A. Notification in respect of auditors
60. Publication of audited balance sheet, etc.
61. Communication by auditor with Monetary Authority
62. (Repealed)
PART XII DISCLOSURE OF INFORMATION BY AUTHORIZED INSTITUTIONS
63. Returns and information to be submitted to the Monetary Authority
64. Information on shareholding, etc.
65. Alteration in constitution
66. Authorized institution to notify Monetary Authority when it ceases to
take deposits
67. Duty to report inability to meet obligations
68. Examination by authorities outside Hong Kong
PART XIII OWNERSHIP AND MANAGEMENT OF AUTHORIZED INSTITUTIONS
69. Amalgamation, etc. requires approval
70. Provisions applicable to persons proposing to become controllers of
authorized institutions incorporated in Hong Kong
70A. Objection to existing controllers
70B. Restrictions on and sale of shares
70C. Prohibition on certain persons acting as indirect controllers
70D. Punishment for attempted evasion of restrictions
71. Chief executives and directors require Monetary Authority's approval
72. (Repealed)
72A. Monetary Authority may require specified persons to submit
information
73. Certain persons prohibited from acting as employees of
authorized institutions except with consent of Monetary Authority
74. Appointment of chief executive
PART XIV 75-78. (Repealed)
PART XV LIMITATIONS ON LOANS BY AND INTERESTS OF AUTHORIZED
INSTITUTIONS
79. Interpretation and application
79A. Monetary Authority may require provisions of this Part to apply to
certain authorized institutions on a consolidated basis
80. Advance against security of own shares, etc.
81. Limitation on advances by authorized institutions
82. Monetary Authority may publish guidelines on business practices of
authorized institutions
83. Limitation on advances to directors, etc. of bank
84. (Repealed)
85. Limitation on advances to employees
86. Powers of Monetary Authority where moneys placed with foreign bank
87. Limitation on shareholding by authorized institutions
88. Limitation on holding of interest in land by authorized institutions
89. (Repealed)
90. Limitation on aggregate holdings under sections 83, 87 and 88
91. Proof of compliance with section 80, 81, 83, 85, 86, 87, 88 or 90
PART XVI ADVER TISEMENTS, REPRESENTATIONS AND USE OF TITLE "BANK"
92. Offence to issue advertisements and documents relating to deposits
93. Fraudulent inducement to make a deposit
94. Liability in tort for inducing persons to make a deposit in certain
cases
95. False, etc. advertisements by authorized institution
96. Certain representations prohibited
97. Restrictions on use of title "bank"
97A. False statements as to authorized status
PART XVII CAPITAL ADEQUACY RATIO OF AUTHORIZED INSTITUTIONS
98. Capital adequacy ratio
99. Failure to keep to capital adequacy ratio
100. Remedial action
101. Monetary Authority may increase capital adequacy ratio for particular
authorized institutions
PART XVIII LIQUIDITY RATIO OF AUTHORIZED INSTITUTIONS AND MATTERS
AFFECTING LIQUIDITY RATIO
102. Liquidity ratio
103. Failure to keep to liquidity ratio
104. Remedial action
105. Monetary Authority may vary liquidity ratio for particular authorized
institutions
106. Authorized institutions not to create certain charges
and to notify Monetary Authority of certain civil proceedings
PART XIX 107-116. (Repealed)
PART XX INVESTIGATIONS OF AUTHORIZED INSTITUTIONS
117. Investigations on behalf of the Financial Secretary
118. Powers of the inspector and offences in connection with the
investigation
PART XXI MISCELLANEOUS
119. Governor in Council to decide whether or not banking business or
business of taking deposits is being conducted
120. Official secrecy
121. Disclosure of information relating to authorized institutions
122. Winding-up of authorized institutions
123. Offences by directors, managers, trustees, employees and agents
124. Prohibition on receipt of commission by staff
125. Search warrants and seizures
126. Defence where director or manager, etc. prosecuted
126A. Limit of time for complaint or information
127. Indemnity
128. (Repealed)
129. Validity of contract in contravention of this Ordinance or any
Ordinance repealed by this Ordinance
130. Revocation or suspension not affect right
131. Recovery of fees, expenses, etc.
131A. Cost related fees to be paid into Exchange Fund
132. Use of English language
133. Power to specify forms
134. Service of documents
135. Power to amend Schedules
136. Consent of Attorney General
137. (Amendments Incorporated)
137A. Exclusion of provisions of Gambling Ordinance
PART XXII TRANSITIONAL, SAVINGS AND REPEAL
138. Interpretation
139. Appointed members of former committees to continue in office
140. (Repealed)
141. Authorized and employed persons to continue to be authorized and
employed
142. Former applications for licences, etc. deemed to be
applications under this Ordinance
143. Former licences, etc. deemed to be licences, etc. under this
Ordinance
144. Date of payment of certain fees
145. Conditions attached to former licences, etc. deemed to be conditions
under this Ordinance
146. Suspension of former registration, etc. deemed to be suspension under
this Ordinance
147. Actions, etc. under part IV of former Banking Ordinance deemed to be
actions under Part X of this Ordinance
148. Transitional provision in relation to certain letters of comfort
148A. Transitional provisions in relation to section 87
149. Transitional provisions in relation to amendments made by Banking
(Amendment) Ordinance 1990
150. Transitional provisions in relation to amendments made by Banking
(Amendment) (No. 2) Ordinance 1991
151. Savings in relation to Exchange Fund (Amendment) Ordinance 1992
First
Schedule Specified period and specified sums
Second Schedule Fees
Third Schedule Capital Adequacy Ratio
Fourth Schedule Liquidity Ratio
Fifth Schedule Requirements applicable to prescribed advertisements
To regulate banking business and the business of taking deposits and to
make provision for the supervision of authorized institutions so as to
provide a measure of protection to depositors and to promote the general
stability and effective working of the banking system, and to provide for
matters incidental thereto or connected therewith.
[The Ordinance, other than Part XVII:
1 September 1986 L. N. 199 of 1986
Part XVII:
1 September 1988] L. N. 210 of 1988
PART I PRELIMINARY
1. Short title
(1) This Ordinance may be cited as the Banking Ordinance.
(2) (Omitted as spent)
2. Interpretation
(1) In this Ordinance, unless the context otherwise requires-
"accounts" means any accounts, whether kept in writing or print or by any
machine or device;
"advertisement" means any form of advertising, whether notified or
published-
(a) in a newspaper, magazine, journal or other periodical
publication;
(b) by the display of posters or notices;
(c) by means of circulars, brochures, pamphlets or handbills;
(d) by an exhibition of photographs or cinematography films; or
(e) by way of sound broadcasting or television, and references to the
issue of an advertisement shall be construed accordingly;
"approved currency" means a currency-
(a) freely convertible into Hong Kong dollars; or
(b) approved by the Monetary Authority; (Added 64 of 1987 s. 2. Amended 82
of 1992 s. 11)
"associate", in relation to a person entitled to exercise, or control the
exercise of, voting power in relation to, or holding shares in, a company,
means any other person in respect of whom that first-mentioned person has
an agreement or arrangement, whether oral or in writing, express or
implied, with respect to the acquisition, holding or disposal of shares or
other interests in that company or under which they act together in
exercising their voting power in relation to it; (Added 95 of 1991 s. 2)
"auditor" means a professional accountant holding a practising certificate
under the Professional Accountants Ordinance (Cap. 50);
"authorized institution" means-
(a) a bank; (Amended 3 of 1990 s. 2)
(b) a restricted licence bank; or (Replaced 3 of 1990 s. 2)
(c) a deposit-taking company; (Added 3 of 1990 s. 2)
"authorized institution incorporated in Hong Kong" means an authorized
institution incorporated in Hong Kong by or under the Companies Ordinance
(Cap. 32) or any other Ordinance and any reference to a bank incorporated
in Hong Kong, a deposit-taking company incorporated in Hong Kong or a
restricted licence bank incorporated in Hong Kong shall be construed
accordingly; (Amended 3 of 1990 s. 2)
"authorized institution incorporated outside Hong Kong" means an
authorized institution incorporated by or under the law or other authority
in any place outside Hong Kong, and in this respect "incorporated"
includes established and any reference to a bank incorporated outside Hong
Kong, a deposit-taking company incorporated outside Hong Kong or a
restricted licence bank incorporated outside Hong Kong shall be construed
accordingly; (Amended 3 of 1990 s. 2)
"automated teller machine" means a terminal device, whether installed by a
bank or by some other person, which is linked directly or indirectly to a
computer system used by a bank and which provides facilities to customers
of the bank;
"bank" means a company which holds a valid banking licence; (Amended 43 of
1990 s. 2)
"Banking Advisory Committee" means the Banking Advisory
Committee established by section
"banking business" means the business of
either or both of the following-
(a) receiving from the general public
money on current, deposit, savings or other similar account repayable on
demand or within less than 3 months or at call or notice of less than 3
months;
(b) paying or collecting cheques drawn by or paid in by customers;
"banking licence" means a banking licence granted under section 16;
(Amended 43 of 1990 s. 2)
"capital adequacy ratio" means the capital adequacy ratio referred to in
section 98;
"certificate of deposit" means a document relating to money, in any
currency, which has been deposited with the issuer or some other person,
being a document which recognizes an obligation to pay a stated amount to
bearer or to order, with or without interest, and being a document by the
delivery of which, with or without endorsement, the right to receive that
stated amount, with or without interest, is transferable;
"chief executive", in relation to an authorized institution, means the
chief executive appointed under section 74 in respect of the institution,
and includes an alternate chief executive so appointed; (Amended 95 of
1991 s. 2)
"company" means a body corporate-
(a) incorporated under the Companies Ordinance (Cap. 32);
(b) incorporated by any other Ordinance; or
(c) incorporated or established outside Hong Kong;
"controller", in relation to a company-
(a) means, in respect of all the provisions of this Ordinance, any person
who is-
(i) an indirect controller; or
(ii) a majority shareholder controller; and
(b) includes, in respect of the provisions of Part XIII, any person who is
a minority shareholder controller,
of that company, and references in this Ordinance to "control" shall be
construed accordingly; (Replaced 95 of 1991 s. 2)
"deposit"-
(a) means a loan of money-
(i) at interest, at no interest or at negative interest; or
(ii) repayable at a premium or repayable with any consideration in money
or money's worth; but
(b) does not include a loan of money-
(i) upon terms involving the issue, by any company, of debentures or other
securities in respect of which a prospectus has been registered under the
Companies Ordinance (Cap. 32); (Replaced 64 of 1987 s. 2)
(ii) upon terms referable to the provision of property or services; or
(iii) by one company to another (neither company being an authorized
institution) at a time when one is a subsidiary of the other or both are
subsidiaries of another company, and references in this Ordinance to the
taking or the making of a deposit shall be construed accordingly;
"depositor" means a person entitled to repayment of a deposit, whether
made by him or not;
"Deposit-taking Companies Advisory Committee" means the Deposit-taking
Companies Advisory Committee established by section 5;
"deposit-taking company" means a company registered as a deposit-taking
company; (Replaced 3 of 1990 s. 2)
"director" includes any person who occupies the position of director,
whatever the title of his office;
"document" includes a circular, brochure, pamphlet, poster, handbill,
prospectus and any other document which is directed at or likely to be
read by members of the public; and also includes any newspaper, magazine,
journal or other periodical publication;
"Exchange Fund" means the
Exchange Fund established under the Exchange Fund Ordinance (Cap. 66);
(Added 82 of 1992 s. 11)
"exercise", in relation to a function, includes perform and discharge;
(Added 95 of 1991 s. 2)
"former auditor" means a person who was formerly the auditor of an
authorized institution or a former authorized institution; (Added 43 of
1990 s. 2)
"Former authorized institution" means an institution which was
formerly a bank, a restricted licence bank or a deposit-taking company;
(Added 43 of 1990 s. 2)
"functions" includes powers and duties;
"holding company" and "subsidiary" have the same meaning as in the
Companies Ordinance (Cap. 32);
"indirect controller", in relation to a company, means any person in
accordance with whose directions or instructions the directors of the
company or of another company of which it is a subsidiary are accustomed
to act, but does not include any person in accordance with whose
directions or instructions those directors are accustomed to act by reason
only that they act on advice given by him in his professional capacity;
(Added 95 of 1991 s. 2)
"issue", in relation to an advertisement, invitation or document, includes
publish, circulate, distribute or disseminate the advertisement,
invitation or document; and also includes causing the advertisement,
invitation or document to be issued; (Amended 95 of 1991 s. 2)
"licence", in relation to-
(a) an authorized institution which is a bank, means a banking licence;
and
(b) an authorized institution which is a restricted licence bank,
means a restricted banking licence, (Amended 3 of 1990 s. 2)
and references in this Ordinance to a licensed authorized institution
shall be construed accordingly;
"licensed" means licensed under this Ordinance;
"liquidity ratio" means the liquidity ratio referred to in section 102;
"local branch", in relation to-
(a) an authorized institution which is a bank, means-
(i) in the case of a bank incorporated in Hong Kong, a place of business
thereof in Hong Kong, other than its principal place of business in Hong
Kong, at which it carries on banking business; and
(ii) in the case of a bank incorporated outside Hong Kong, a place of
business thereof in Hong Kong, a place of business thereof in Hong Kong,
other than its principal place of business in Hong Kong or a local
representative office thereof, at which it carries on banking business,
but in either case does not mean an automated teller machine; and
(b) an authorized institution which is a deposit-taking company or a
restricted licence bank, means a place of business in Hong Kong of a
deposit-taking company or a restricted licence bank, other than its
principal place of business in Hong Kong, at which it carries on the
business of taking deposits; (Amended 3 of 1990 s. 2)
"local
representative office" means an office in Hong Kong of a bank incorporated
outside Hong Kong which is not-
(a) licensed under section 16;
(b) a deposit-taking company or a restricted licence bank; and (Amended 3
of 1990 s. 2)
(c) recognized as the central bank of the place in which it
is incorporated;
"majority shareholder controller", in relation to a
company, means any person who, either alone or with any associate or
associates, is entitled to exercise, or control the exercise of, more than
50% of the voting power at any general meeting of the company or of
another company of which it is a subsidiary; (Added 95 of 1991 s. 2)
"manager" in relation to an authorized institution means its chief
executive and any other person employed by the institution who, under the
immediate authority of a director or of the chief executive, exercises
managerial functions or is responsible for maintaining accounts or other
records of the institution;
"minority shareholder controller", in relation to a company, means any
person who, either alone or with any associate or associates, is entitled
to exercise, or control the exercise of, 10% or more, but not more than
50%, of the voting power at any general meeting of the company or of
another company of which it is a subsidiary; (Added 95 of 1991 s. 2)
"Monetary Authority" means the Monetary Authority appointed under section
5A of the Exchange Fund Ordinance (Cap. 66); (Added 82 of 1992 s. 11)
"money at call" means money payable within not more than 24 hours of a
demand therefor, but does not include money payable on demand;
"net debit balance", in relation to a company, means the aggregate of the
excess of accumulated losses over accumulated profits disclosed in the
profit and loss account, and other reserves separately disclosed in the
balance sheet, of the most recent audited accounts of the company; (Added
95 of 1991 s. 2)
"overseas branch" means a branch outside Hong Kong of an authorized
institution incorporated in Hong Kong, at which it carries on banking
business or a business of taking deposits, as the case may be, whether or
not the business of the branch is limited by the laws or regulations of
the place in which the branch is situated and whether or not the branch is
referred to as an agency in such place;
"overseas representative office" means an office outside Hong Kong, other
than an overseas branch, of an authorized institution incorporated in Hong
Kong;
"register" means the register maintained under section 27;
"registered" means registered under this Ordinance;
"reserves", in relation to an authorized institution, means reserves which
appear in the accounts of the institution, but does not include any
reserves which are represented by the writing down of the value of assets
or by provision for the depreciation of fixed assets; (Added 95 of 1991 s.
2)
"restricted banking licence" means a restricted banking licence granted
under section 25; (Added 3 of 1990 s. 2)
"restricted licence bank" means a company which holds a valid restricted
banking licence; (Added 3 of 1990 s. 2)
"share" means share in the share capital of a company, and includes stock
except where a distinction between stock or shares is expressed or
implied; and the expression "shareholder" includes a stockholder;
"short-term deposit" means a deposit with an original term to maturity of
less than the period specified in item 1 of the First Schedule or with a
period of call or notice of less than such specified period; (Amended 3 of
1990 s. 2)
"specified sum", in relation to-
(a) a deposit-taking company, means the sum referred to in section 14 (1)
(a); and
(b) a restricted licence bank, means the sum referred to in
section 14 (1) (b); (Amended 3 of 1990 s. 2)
"Unified Exchange" has the same meaning as in the Stock Exchanges
Unification Ordinance (Cap. 361);
"working day" means a day other than a public holiday or a gale warning
day within the manning of section 2 of the Judicial Proceedings
(Adjournment During Gale Warning Days) Ordinance (Cap. 62). (Added 95 of
1991 s. 2)
(Amended 3 of 1990 s. 2; 82 of 1992 s. 11)
(2) For the purposes of this Ordinance-
(a) the taking of deposits includes holding out as being prepared to take
deposits;
(b) an advertisement issued by any person by way of display or
exhibition in a public place shall be treated as being issued by him on
every day on which he causes or authorizes it to be displayed or
exhibited;
(c) an advertisement or document which consists of or contains information
likely to lead, directly or indirectly, members of the public to-
(i) make deposits; or
(ii) enter into, or offer to enter into, agreements to make deposits,
shall be treated as being an advertisement or document which is or
contains an advertisement to members of the public so to do; and
(d) an advertisement or document issued by one person on behalf of or to
the order of another shall be treated as an advertisement or document, as
the case may be, issued by that other person.
(3) Without limiting the generality of any other meaning which "insolvent"
may have, an authorized institution shall, for the purposes of this
Ordinance, be deemed to be insolvent if it has ceased to pay its debts in
the ordinary course of business or it cannot pay its debts as they become
due.
(4) Where, under this Ordinance, an authorized institution is required to
provide facilities to any person for the purpose of any investigation or
examination of the institution, such facilities shall include photocopying
facilities.
3. Application
(1) Part III of this Ordinance shall not apply to the taking of any
deposit by-
(a) a trust company registered under Part VIII of the Trustee
Ordinance (Cap. 29);
(b) a credit union registered under the Credit Unions
Ordinance (Cap. 119);
(c) a company, where such deposit is secured by a
mortgage, or charge, registered or to be registered under the Companies
Ordinance (Cap. 32);
(d) a person bona fide carrying on insurance business where such deposit
is taken in the ordinary course of such business;
(e) a person bona fide operating a superannuation or provident fund where
such deposit is taken for the purposes of such fund;
(f) a public utility company specified in Schedule 3 to the Inland Revenue
Ordinance (Cap. 112) where such deposit is taken from a consumer; (Amended
95 of 1991 s. 2)
(g) an employer where such deposit is taken from a bona
fide employee;
(h) a solicitor, where such deposit is taken from a client,
or as a stockholder, in the ordinary course of his practice; (Amended 64
of 1987 s. 3)
(i) the Urban Council or the Regional Council;
(j) a person who is a dealer within the meaning of the Securities
Ordinance (Cap. 333) where section 84 of that Ordinance applies to such
deposit, or a mutual fund corporation or unit trust authorized under
section 15 of that Ordinance; (Amended 10 of 1989 s. 65)
(k) a person who is registered as a dealer under the Commodities Trading
Ordinance (Cap. 250) where such deposit is taken from a client in the
ordinary course of his business as a dealer; (Amended 68 of 1992 s. 20)
(l) a recognized clearing house within the meaning of section 2 of the
Securities (Clearing Houses) Ordinance (Cap. 420), where such deposit is
provided as security in relation to a marker contract within the meaning
of that section; or (Added 68 of 1992 s. 20)
(m) the Exchange Fund established by the Exchange Fund Ordinance (Cap.
66). (Replaced 64 of 1987 s. 3)
(2) Part III of this Ordinance shall not apply to the taking of any
deposit from-
(a) an authorized institution;
(b) a bank incorporated or established outside Hong Kong that is not
licensed under this Ordinance;
(c) a money lender licensed under the Money Lenders Ordinance (Cap. 163)
in the ordinary course of his business as a money lender; or
(d) a pawnbroker licensed under the Pawnbrokers Ordinance (Cap. 166) in
the ordinary course of his business as a pawnbroker.
(3) Notwithstanding anything in The Hongkong and Shanghai Banking
Corporation Limited Ordinance (Cap. 70), this Ordinance shall apply to The
Hongkong and Shanghai Banking Corporation Limited. (Amended L. N. 333 of
1989; 95 of 1991 s. 3)
(4) Where there is any conflict or inconsistency between this Ordinance
and The Hongkong and Shanghai Banking Corporation Limited Ordinance (Cap.
70) the provisions of this Ordinance shall prevail. (Amended L. N. 333 of
1989; 95 of 1991 s. 3)
(5) An authorized institution which is incorporated or registered by or
under the Companies Ordinance (Cap. 32) shall be subject to that Ordinance
as well as to this Ordinance, except that where there is any conflict or
inconsistency between this Ordinance and the Companies Ordinance (Cap. 32)
the provisions of this Ordinance shall prevail.
PART II APPOINTMENTS, FUNCTIONS OF MONETARY AUTHORITY, REPORTS BY MONETARY AUTHORITY AND POWER OF GOVERNOR TO GIVE DIRECTIONS
(Amended 82 of 1992 s. 25)
4. Banking Advisory Committee
(1) There is hereby established a Banking Advisory Committee for the
purpose of advising the Governor upon any matter connected with this
Ordinance, in particular in relation to banks and the carrying on of
banking business, and of advising the Governor in Council on each annual
report submitted under section 9(1) and in any case where the advice of
the Committee is sought under section 53 (2).
(2) The Banking Advisory Committee shall consist of the Financial
Secretary, who shall be the chairman, the Monetary Authority, and such
other persons, not being less than 4 nor more than 12, as the Governor may
from time to time appoint.
(3) The members of the Banking Advisory Committee appointed by the
Governor shall hold office for such period and upon such terms as the
Governor may specify in their appointments.
(4) In the absence of the chairman at any meeting of the Banking Advisory
Committee, the Financial Secretary may appoint the chairman.
(Amended 82 of 1992 s. 12)
5. Deposit-taking Companies Advisory Committee
(1) There is hereby established a Deposit-taking Companies Advisory
Committee for the purpose of advising the Governor upon any matter
connected with this Ordinance, in particular in relation to deposit-taking
companies and restricted licence banks and the carrying on of a business
of taking deposits by them, and of advising the Governor in Council on
each annual report submitted under section 9 (1) and in any case where the
advice of the Committee is sought under section 53 (2). (Amended 3 of 1990
s. 3)
(2) The Deposit-taking Companies Advisory Committee shall consist of
the Financial Secretary, who shall be the chairman, the Monetary
Authority, and such other persons, not being less than 4 nor more than 12,
as the Governor may from time to time appoint.
(3) The members of the
Deposit-taking Companies Advisory Committee appointed by the Governor
shall hold office for such period and upon such terms as the Governor may
specify in their appointments.
(4) In the absence of the chairman at any meeting of the Deposit-taking
Companies Advisory Committee, the Financial Secretary may appoint the
chairman. (Amended 82 of 1992 s. 13)
6. (Repealed 82 of 1992 s. 14)
7. Functions of Monetary Authority
(1) The principal function of the Monetary Authority under this Ordinance
shall be to promote the general stability and effective working of the
banking system. (Amended 82 of 1992 s. 15)
(2) Without limiting the generality of subsection (1), the Monetary
Authority shall-(Amended 82 of 1992 s. 25)
(a) be responsible for supervising compliance with the provisions of this
Ordinance;
(b) take all reasonable steps to ensure that the principal
places of business, local branches, overseas branches and overseas
representative offices of all authorized institutions and local
representative offices are operated in a responsible, honest and business-
like manner;
(c) promote and encourage proper standards of conduct and sound and
prudent business practices amongst authorized institutions;
(d) suppress or aid in suppressing illegal, dishonourable or improper
practices in relation to the business practices of authorized
institutions;
(e) co-operate with and assist recognized financial services supervisory
authorities of Hong Kong or of any place outside Hong Kong, whenever
appropriate, to the extent permitted by this or any other Ordinance; and
(Amended 95 of 1991 s. 4)
(f) consider and propose reforms of the law
relating to banking business and the business of taking deposits.
(3) The Monetary Authority may from time to time cause to be prepared and
published by notice in the Gazette, for the guidance of authorized
institutions, guidelines not inconsistent with this Ordinance, indicating
the manner in which he proposes to exercise functions conferred or imposed
by this Ordinance upon him. (Amended 82 of 1992 s. 25)
8. (Repealed 82 of 1992 s. 16)
9. Reports by Monetary Authority
(1) The Monetary Authority shall, as soon as practicable after each 31
December, prepare and furnish to the Financial Secretary for presentation
to the Governor in Council a report on the working of this Ordinance and
on the activities of his office during the preceding year and, in that
report, may set out any measures that he considers necessary for improving
the working of this Ordinance and of the activities of his office.
(2) In
the report under subsection (1), the Monetary Authority shall draw
attention to any breach or avoidance of this Ordinance that has come to
his notice during the preceding year or any irregularity discovered by him
in the accounts and records of the financial transactions of any
authorized institution for that period which is, in his opinion, of
sufficient importance to justify him so doing.
(3) The Monetary Authority shall, at such times as he considers necessary,
report to the Financial Secretary on improvements that he considers to be
desirable in the operation and management of his office.
(4) The Governor may, at any time, request the Monetary Authority to
report to him on any matter relating to the working of this Ordinance or
the activities of the office of the Monetary Authority, and the Monetary
Authority shall, forthwith, prepare and furnish a report to the Governor
accordingly.
(5) The Financial Secretary shall present to the Governor in Council each
report furnished to him under subsection (1) as soon as practicable after
it is so furnished.
(6) Where the Governor in Council is presented under
subsection (5) with a report furnished under subsection (1) to the
Financial Secretary, the Governor in Council may, as he thinks fit,
publish the report, in whole or in part, in such manner as he thinks fit
or decline to publish any part of the report.
(Amended 82 of 1992 s. 25)
10. Power of Governor to give directions
(1) The Governor may give to the Financial Secretary and the Monetary
Authority such directions as he thinks fit with respect to the exercise of
their respective functions under this Ordinance, either generally or in
any particular case.
(2) The Financial Secretary and the Monetary Authority shall, in the
exercise of their respective functions under this Ordinance, comply with
any directions given by the Governor under this section.
(Amended 82 of 1992 s. 25)
PART III BANKING BUSINESS AND BUSINESS OF TAKING DEPOSITS TO BE CARRIED ON BY AUTHORIZED INSTITUTIONS ONLY
11. Banking business restricted to licensed banks
(1) No banking business shall be carried on in Hong Kong except by a bank.
(2) Any person who and every director and every manager of a company which
contravenes this section commits an offence and is liable-
(a) on conviction upon indictment to a fine of $500,000 and to
imprisonment for 5 years; or
(b) on summary conviction to a fine of $ 50,000 and to imprisonment for 6
months.
12. Restriction on business of taking deposits
(1) No business of taking deposits shall be carried on in Hong Kong except
by an authorized institution.
(2) A deposit-taking company shall not take any short-term deposit in Hong
Kong.
(3) A deposit-taking company shall not, without the written
permission of the Monetary Authority, repay any deposit within a period of
less than the period specified in item 1 of the First Schedule from the
date on which the deposit was taken by the company. (Amended 82 of 1992
s. 25)
(4) No deposit-taking company or restricted licence bank shall receive
money on savings account.
(5) Subject to section 14, a restricted licence bank may take or hold
short-term deposits.
(6) Any person who contravenes subsection (1), every director and every
manager of a deposit-taking company which contravenes subsection (2), (3)
or (4), and every director and every manager of a restricted licence bank
which contravenes subsection (4), commits an offence and is liable-
(a) on conviction upon indictment to a fine of $500,000 and to
imprisonment for 5 year; or
(b) on summary conviction to a fine of $ 50,000 and to imprisonment for 6
months.
(7) Any person who enters into a contract or arrangement, or uses any
device or scheme, which has the effect of, or is designed to have the
effect of, avoiding subsection (1), (2), (3) or (4) commits an offence and
is liable-
(a) on conviction upon indictment to a fine of $500,000 and to
imprisonment for 5 years; or
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6
months.
(8) For the purposes of any proceedings for an offence under
subsection (6), if it is proved that a person took deposits on at least 5
occasions within any period of 30 days, that person shall, until the
contrary is proved, be deemed to have been carrying on a business of
taking deposits.
(Amended 3 of 1990 s. 4)
13. Power to grant exemptions
(1) The Financial Secretary may, by notice in the Gazette, exempt any
person or class of persons from section 12 (1) and, if the Financial
Secretary thinks fit, in that notice also exempt that person or class of
persons from section 92 (1) in respect of the business of taking deposits
to which the exemption from section 12 (1) relates. (Replaced 64 of 1987
s. 4)
(2) An exemption under subsection (1) shall be subject to such conditions
as are specified in the notice.
(3) The Financial Secretary may at any time by notice in the Gazette-
(a) revoke an exemption under subsection (1); or
(b) revoke, vary, or add to, any condition subject to which such exemption
is granted.
14. Deposit-taking company not to take deposits less than specified sum
(1) Subject to subsection (2) -
(a) a deposit-taking company shall not take in Hong Kong any deposit from
a depositor of a sum less than the amount specified in item 2 of the First
Schedule; and
(b) a restricted licence bank shall not take in Hong Kong
any deposit from a depositor of a sum less than the amount specified in
item 3 of the First Schedule. (Amended 95 of 1991 s. 5)
(2) A deposit-taking company or a restricted licence bank may take a
deposit from a depositor of a sum less than the specified sum applying at
the date of that deposit if the amount standing to the credit of the
depositor with the deposit-taking company or restricted licence bank, as
the case may be, at the time any such deposit is taken is not less than
the specified sum applying at the date of that deposit.
(3) Except where
a depositor withdraws the whole amount standing to his credit with a
deposit-taking company or a restricted licence bank, the deposit-taking
company or restricted licence bank, as the case may be, shall not at the
time of the withdrawal of any sum permit the amount of the balance
standing to the credit of the depositor to be less than the specified sum.
(4) Notwithstanding subsection (3), where a depositor has an amount
standing to his credit with a deposit-taking company or a restricted
licence bank at a time when the specified sum is amended by being
increased, the deposit-taking company or restricted licence bank, as the
case may be, may permit the amount of the balance to be reduced by
withdrawals to any amount that is not less than the specified sum as it
was before being so amended.
(5) Every director and every manager of a deposit-taking company or a
restricted licence bank which contravenes subsection (1) or (3) commits an
offence and is liable-
(a) on conviction upon indictment to a fine of
$500,000 and to imprisonment for 2 years; or
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6
months.
(6) Any person who holds himself out, whether as a broker or
agent of a deposit-taking company or a restricted licence bank or
otherwise, as being prepared to take from any person, any sum less than
the specified sum for the purpose of making a deposit of that sum, or of
that sum and other sums, with the deposit-taking company or restricted
licence bank, as the case may be, commits an offence and is liable-
(a) on conviction upon indictment to a fine of $500,000 and to
imprisonment for 2 years; or
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6
months.
(7) Any person who enters into a contract or arrangement, or uses any
device or scheme, which has the effect of, or is designed to have the
effect of, avoiding subsection (1) or (3) commits an offence and is
liable-
(a) on conviction upon indictment to a fine of $500,000 and to
imprisonment for 5 years; or
(b) on summary conviction to a fine of $50,000 and to imprisonment for 6
months. (Amended 3 of 1990 s. 5)
PART IV LICENSING AND REGISTRATION OF AUTHORIZED INSTITUTIONS AND KEEPING OF REGISTER
15. Application for banking licence
(1) A company which wishes to carry on, or a body of persons proposing to
form a company for the purpose of carrying on, banking business shall
apply to the Governor in Council, through the Monetary Authority, for a
banking licence or, in the case of a body of persons proposing to form a
company, for an intimation that a banking licence will be granted to the
company upon its incorporation. (Amended 3 of 1990 s. 6)
(2) There shall be
lodged with the Monetary Authority in respect of an application for a
banking licence or for an intimation that a banking licence will be
granted-
(a) a copy of the charter, Ordinance (other than the Companies
Ordinance (Cap. 32)), statutes, memorandum of association and articles of
association, or other instrument, under which the company is or is to be
incorporated, which shall be verified in such manner as the Monetary
Authority or the Governor in Council may require; and
(b) such other
documents and information as may be required by the Monetary Authority or
the Governor in Council.
(3) After receiving an application for a banking licence, the Monetary
Authority shall forward to the Governor in Council the application and his
advice as to whether or not the applicant should be granted a banking
licence or, in the case of a proposed company, whether or not the company
upon incorporation should be granted a banking licence. (Amended 82 of
1992 s. 25)
16. Grant or refusal of banking licence
(1) After receiving an application forwarded under section 15 and the
advice of the Monetary Authority in respect thereof the Governor in
Council may- (Amended 82 of 1992 s. 25)
(a) grant a banking licence or, in the case of a proposed company,
intimate his intention to grant a banking licence upon receipt of notice
of its incorporation;
(b) grant a banking licence subject to such
conditions as he may think proper to attach thereto in any particular case
or, in the case of a proposed company, intimate his intention, upon
receipt of notice of its incorporation, to grant a banking licence subject
to the attachment of such conditions; or
(c) without assigning any reason therefor, refuse to grant a banking
licence or, in the case of a proposed company, intimate his intention to
refuse to grant a banking licence upon receipt of notice of its
incorporation.
(2) Every director and every manager of a bank which contravenes any
condition attached under subsection (1) (b) to its banking licence commits
an offence and is liable-
(a) on conviction upon indictment to a fine of $ 200,000; or
(b) on summary conviction to a fine of $50,000, and, in the case of a
continuing offence, to a further fine of $5,000 for every day during which
the offence continues.
17. Amendment of conditions of banking licence
(1) Without limiting the generality of section 16 (1) (b), the Governor in
Council may at any time, by notice in writing served upon a bank, attach
to its banking licence such conditions, or amend or cancel any conditions
attached to the banking licence, as he may think proper.
(2) Every director and every manager of a bank which contravenes any
condition attached under this section to its banking licence commits an
offence and is liable-
(a) on conviction upon indictment to a fine of $200,000; or
(b) on summary conviction to a fine of $50,000, and, in the case of a
continuing offence, to a further fine of $5,000 for every day during which
the offence continues.
18. Minimum paid-up share capital for grant of banking licence
(1) No company which is incorporated in Hong Kong shall be granted a
banking licence unless its share capital issued and paid-up is not less
than $150,000,000 or an equivalent amount in any other approved currency.
(Amended 64 of 1987 s. 5; 3 of 1990 s. 7; 95 of 1991 s. 6)
(1A) For the purposes of determining the share capital issued and paid-up
of-
(a) a company incorporated in Hong Kong which has made an application
for a banking licence, there shall be deducted from such share capital any
net debit balance; and
(b) a bank incorporated in Hong Kong, there shall
be deducted from such share capital any net debit balance. (Added 95 of
1991 s. 6)
(2) The Governor in Council may, by notice in the Gazette, amend the
amount of share capital issued and paid-up specified in subsection (1).
19. Banking licence fees
(1) Every bank shall pay the annual banking licence fee specified in the
Second Schedule.
(2) The fee payable under this section shall be paid to the Director of
Accounting Services within 14 days after the grant of the banking licence
and thereafter upon every anniversary of the date of its grant. (Amended
64 of 1987 s. 6; 82 of 1992 s. 17).
20. Application for registration as deposit-taking company
(1) A company which proposes to carry on a business of taking deposits as
a deposit-taking company shall apply to the Monetary Authority for
registration.
(2) There shall be lodged with the Monetary Authority in
respect of an application for registration-
(a) a copy of the memorandum and articles of association or other document
constituting the company, which shall be verified in such manner as the
Monetary Authority may require; and
(b) such other documents and information as the Monetary Authority may
require. (Replaced 3 of 1990 s. 8. Amended 82 of 1992 s. 25)
21. Registration or refusal of registration of deposit-taking company
(1) Subject to subsection (2), the Monetary Authority may, on receipt of
an application in accordance with section 20- (Amended 82 of 1992 s. 25)
(a) register a company as a deposit-taking company subject to such
conditions as he may think proper to attach thereto in any particular
case; or
(b) refuse to register the company as a deposit-taking company. (Replaced
3 of 1990 s. 9)
(2) Without limiting the generality of the Monetary Authority's power to
refuse to register a company under subsection (1), he shall refuse to
register a company under that subsection if- (Amended 82 of 1992 s. 18)
(a) the paid-up share capital of the company, as determined under
subsection (3), is less than $25,000,000 or an equivalent amount in any
other approved currency; or
(b) the company does not satisfy him that it
is a fit and proper body to be registered. (Replaced 3 of 1990 s. 9)
(3) For the purposes of determining the paid-up share capital of-
(a) a company which has made an application for registration, there shall
be deducted from such share capital any net debit balance; and
(b) a deposit-taking company, there shall be deducted from such share
capital any net debit balance. (Amended 64 of 1987 s. 7; 3 of 1990 s. 9;
95 of 1991 s. 7)
(4) The Governor in Council may, by notice in the
Gazette, amend the amount of paid-up share capital specified in subsection
(2) (a).
(5) The registration of a company under subsection (1) as a deposit-taking
company shall be effected by entering in the register the relevant
particulars specified in section 27 and the Monetary Authority shall
notify the company in writing of the registration and date of
registration. (Amended 3 of 1990 s. 9; 82 of 1992 s. 25)
(6) Where the Monetary Authority refuses to register a company under
subsection (2), he shall notify the company in writing of the refusal.
(Amended 82 of 1992 s. 25)
(7) Any company aggrieved by the refusal of the
Monetary Authority to register it under subsection (2), or by the
imposition by him of conditions under subsection (1), may appeal to the
Governor in Council against the refusal or the conditions but that refusal
or, as the case may be, those conditions shall take effect immediately,
notwithstanding that an appeal has been or may be made under this
subsection. (Amended 82 of 1992 s. 25)
(8) Every director and every
manager of a deposit-taking company which contravenes any condition
attached under subsection (1) to its registration commits an offence and
is liable-
(a) on conviction upon indictment to a fine of $200,000; or
(b) on summary conviction to a fine of $50,000, and, in the case of a
continuing offence, to a further fine of $5,000 for every day during which
the offence continues.
22. Amendment of conditions of registration
(1) Without limiting the generality of section 21 (1), the Monetary
Authority may at any time, by notice in writing served on a deposit-taking
company, attach to the registration of the company such conditions, or
amend or cancel any conditions attached to the registration, as he may
think proper. (Amended 3 of 1990 s. 10; 82 of 1992 s. 25)
(2) Any company
aggrieved by any conditions to which its registration is made subject by
the Monetary Authority under subsection (1) may appeal against the
conditions to the Governor in Council, but those conditions shall take
effect immediately notwithstanding that an appeal has been or may be made
under this subsection. (Amended 82 of 1992 s. 25)
(3) Every director and
every manager of a deposit-taking company which contravenes any condition
attached under this section to its registration commits an offence and is
liable-
(a) on conviction upon indictment to a fine of $200,000; or
(b) on summary conviction to a fine of $50,000, and, in the case of a
continuing offence, to a further fine of $5,000 for every day during which
the offence continues.
23. Registration fees
(1) A deposit-taking company shall, within 14 days after the receipt of a
notice of registration under section 21 (5), pay to the Director of
Accounting Services the registration fee specified in the Second Schedule.
(2) Every deposit-taking company shall pay to the Director of Accounting
Services annually the renewal of registration fee specified in the Second
Schedule-
(a) in the case of a company which was carrying on a business of
taking deposits on 1 April 1976, on 1 April in each year, and (Amended 64
of 1987 s. 8)
(b) in the case of any other company, upon the anniversary of the date of
registration of such company. (Amended 64 of 1987 s. 8)
(Amended 3 of 1990 s. 11)
24. Application for restricted banking licence
(1) A company which proposes to carry on a business of taking deposits as
a restricted licence bank shall apply to the Financial Secretary, through
the Monetary Authority, for a restricted banking licence.
(2) There shall be lodged with the Monetary Authority in respect of an
application for a restricted banking licence-
(a) a copy of the memorandum and articles of association or other document
constituting the company, which shall be verified in such manner as the
Monetary Authority or the Financial Secretary may require; and
(b) such other documents and information as may be required by the
Monetary Authority or the Financial Secretary.
(3) After receiving an application for a restricted banking licence, the
Monetary Authority shall forward to the Financial Secretary the
application and his advice as to whether or not the applicant should be
granted a restricted banking licence and, in giving that advice, the
Monetary Authority shall have regard to the matters specified in section
25 (2). (Replaced 3 of 1990 s. 12. Amended 82 of 1992 s. 25)
25. Grant or refusal of restricted banking licence
(1) Subject to subsection (2), the Financial Secretary may, on receipt of
an application and the advice of the Monetary Authority in accordance with
section 24- (Amended 82 of 1992 s. 25)
(a) grant a restricted banking licence subject to such conditions as he
may think proper to attach thereto in any particular case; or
(b) refuse to grant a restricted banking licence.
(2) Without limiting the generality of the Financial Secretary's power to
refuse to grant a restricted banking licence to a company under subsection
(1), he shall refuse to grant a restricted banking licence to a company
under that subsection if-
(a) the share capital issued and paid-up of the
company, as determined in accordance with subsection (3), is less than $
100,000,000 or an equivalent amount in any other approved currency; or
(b) the company does not satisfy him that it is a fit and proper body to
be granted a restricted banking licence.
(3) For the purposes of determining the share capital issued and paid-up
of-
(a) a company which has made an application for a restricted banking
licence, there shall be deducted from such share capital any net debit
balance; and
(b) a restricted licence bank, there shall be deducted from such share
capital any net debit balance. (Amended 95 of 1991 s. 8)
(4) The Governor in Council may, by notice in the Gazette, amend the
amount of share capital issued and paid-up specified in subsection (2)
(a).
(5) Without limiting the generality of the power to attach conditions
under subsection (1) (a), the Financial Secretary may at any time, by
notice in writing served upon a restricted licence bank, attach to the
restricted banking licence held by the restricted licence bank such
conditions, or amend or cancel any conditions attached to the restricted
banking licence, as he may think proper.
(6) Where the Financial Secretary refuses to grant a restricted banking
licence under subsection (1) (b) to a company, he shall notify the company
in writing of the refusal.
(7) Any company aggrieved by the refusal of
the Financial Secretary to grant a restricted banking licence to it under
subsection (1), or by the imposition by him of conditions under subsection
(1) or (5), may appeal to the Governor in Council against the refusal or
the conditions, but that refusal or, as the case may be, those conditions
shall take effect immediately, notwithstanding that an appeal has been or
may be made under this subsection.
(8) Every director and every manager of a restricted licence bank which
contravenes any condition attached under subsection (1) (a) or (5) to its
restricted banking licence commits an offence and is liable-
(a) on conviction upon indictment to a fine of $200,000; or
(b) on summary conviction to a fine of $50,000, and, in the case of a
continuing offence, to a further fine of $5,000 for every day during which
the offence continues.
(Replaced 3 of 1990 s. 12)
26. Restricted banking licence fees
(1) A restricted licence bank shall, within 14 days after the grant to it
of a restricted banking licence, pay to the Director of Accounting
Services the restricted banking licence fee specified in the Second
Schedule.
(2) Every restricted licence bank shall pay to the Director of Accounting
Services annually the renewal of restricted banking licence fee specified
in the Second Schedule upon the anniversary of the date of grant of the
restricted banking licence. (Replaced 3 of 1990 s. 12)
26A. Effect of grant of licence to or registration of existing authorized
institution, etc.
(1) Where a deposit-taking company is granted a restricted banking licence
or a banking licence, it shall thereupon cease to be a deposit-taking
company.
(2) Where a restricted licence bank is registered as a deposit-taking
company or granted a banking licence, it shall thereupon cease to be a
restricted licence bank.
(3) Where a bank is registered as a deposit-
taking company or granted a restricted banking licence, it shall thereupon
cease to be a bank.
(4) Where subsection (1), (2) or (3) applies to an authorized institution
and-
(a) prior to the date on which that subsection applied to the
institution, the institution had lawfully taken a deposit, and
(b) the holding of that deposit by that institution on or after that date
would but for this subsection contravene any of the provisions of section
12 or 14,
the institution may continue to hold until maturity that deposit and,
accordingly, the holding until maturity of that deposit shall be deemed
not to contravene any of the provisions of section 12 or 14.
(5) Where subsection (3) applies to an authorized institution, the
institution may continue to hold, for not more than 3 months after the
date on which that subsection applied to it, any money on savings account
received by it prior to that date and, accordingly, the holding of that
money for not more than that period shall be deemed not to contravene
section 12 (4).
(Added 3 of 1990 s. 12)
27. Register of authorized institutions, etc.
(1) The Monetary Authority shall maintain a register, in such form as he
thinks fit, which shall contain-
(a) the name and business address of every bank;
(b) the name of every bank which has a local representative office and the
business address of every local representative office; (Amended 95 of 1991
s. 9)
(c) the name and business address of every deposit-taking company;
(d) the name and business address of every restricted licence bank; and
(e) such other particulars of banks, local representative offices,
deposit-taking companies or restricted licence banks as the Monetary
Authority thinks fit. (Amended 3 of 1990 s. 13)
(2) The register shall be kept at the office of the Monetary Authority or
at such other place as may be notified by the Monetary Authority in the
Gazette.
(3) Any member of the public may, with effect from such date and during
such hours as shall be notified by the Monetary Authority in the Gazette,
on payment of the fee specified in the Second Schedule-
(a) inspect the register or obtain a copy of an entry in the register or
an extract from the register; or
(b) inspect or obtain a copy of or an extract from any document lodged
with the Monetary Authority under section 15 (other than any document or
information referred to in subsection (2) (b) of that section) and section
20 (other than any document or information referred to in subsection (2)
(b) of that section).
(4) A document purporting to be a copy of any entry in or extract from the
register, or of any document lodged with the Monetary Authority by a
company under this Ordinance, and purporting to be certified by the
Monetary Authority shall be admitted in evidence in criminal or civil
proceedings before any court on its production without further proof, and-
-
(a) until the contrary is proved, the court before which such document is
produced shall presume-
(i) that the document is certified by the Monetary Authority; and
(ii) that the document is a true copy of the entry in or extract from the
register, or of the document lodged with the Monetary Authority, to which
it refers; and
(b) such document shall be prima facie evidence of all
matters contained therein. (Amended 82 of 1992 s. 25)
28. Publication of names entered in or removed from register and
suspensions
(1) Where the name of a bank (including a bank referred to in
section 27 (1) (b), deposit-taking company or restricted licence bank is
entered in the register, the Monetary Authority shall publish in the
Gazette notice of such entry. (Amended 3 of 1990 s. 14; 95 of 1991 s. 10)
(2) Where a company ceases to be a deposit-taking company, restricted
licence bank or bank by virtue of section 26A (1), (2) or (3)
respectively, the Monetary Authority shall-
(a) remove from the register the name of the former deposit-taking
company, restricted licence bank or bank, as the case may be; and
(b) publish in the Gazette notice of such removal. (Replaced 3 of 1990 s.
14)
(3) Where the licence or registration of an authorized institution is
revoked under this Ordinance, the Monetary Authority shall-
(a) remove from the register the name of the former authorized institution
concerned; and
(b) publish in the Gazette notice of such removal.
(4) Where the registration of a deposit-taking company or the restricted
banking licence of a restricted licence bank is suspended under this
Ordinance, the Monetary Authority shall-
(a) make a notation in the register against the name of the deposit-taking
company or restricted licence bank concerned that its registration or
restricted banking licence, as the case may be, has been so suspended and,
if such suspension is for a specified period, shall, in that notation,
give particulars of such period; and
(b) publish in the Gazette notice of such notation. (Replaced 3 of 1990 s.
14)
(5) Where approval for the establishment of a local representative
office is revoked under this Ordinance, the Monetary Authority shall-
(a) remove from the register the name of the bank which maintained the
local representative office; and (Amended 95 of 1991 s. 10)
(b) publish in the Gazette notice of such removal.
(6) (Repealed 3 of 1990 s. 14)
(Amended 82 of 1992 s. 25)
PART V REVOCATION OF LICENCE OR REGISTRATION OF AUTHORIZED INSTI- TUTION
29. Revocation of banking licence
(1) The Governor in Council may revoke a banking licence-
(a) if he is satisfied that the holder of the banking licence-
(i) has ceased to carry on banking business in Hong Kong;
(ii) proposes to make, or has made, any composition or arrangement with
its creditors or is insolvent or is being or has been wound up or is
otherwise dissolved; or (iii) has failed to maintain adequate provision
for depreciation or diminution in the value of its assets (including
provision for bad and doubtful debts), for liabilities which will or may
fall to be discharged by it and for losses which it will or may incur; or
(Added 95 of 1991 s. 11)
(aa) where the holder of the banking licence is incorporated in Hong
Kong, if he is satisfied that the share capital issued and paid-up of the
holder is less than the amount specified in section 18 (1); or (Added 95
of 1991 s. 11)
(b) if-
(i) where the Monetary Authority has made a report to him under section
52 (1) (D); or (Amended 82 of 1992 s. 25)
(ii) where the Financial Secretary has referred a report and his
recommendations thereon to the Governor in Council under section 117 (5)
(c), he considers it is in the public interest to revoke the banking
licence.
(2) Without limiting the generality of subsection (1), the Governor in
Council may revoke the banking licence of a bank on being requested in
writing by the bank to do so, if he is satisfied that the interests of
depositors of that bank are or will be adequately safeguarded. (Added 95
of 1991 s. 11)
30. Procedure on and effect of revocation of banking licence
(1) Where the banking licence of a bank is revoked the Monetary
Authority shall notify the bank in writing of such revocation and the bank
shall, on and from the date specified in that notice, cease to carry on
any banking business in Hong Kong. (Amended 82 of 1992 s. 25)
(2) Subsection (1) shall not prejudice the enforcement by any person of
any right or claim against the bank or by the bank of any right or claim
against any person.
31. Revocation of registration
(1) Subject to section 33 (1), the Monetary Authority may revoke the
registration of a deposit-taking company if- (Amended 3 of 1990 s. 15; 82
of 1992 s. 25)
(a) the company-
(i) has ceased to carry on a business of taking deposits; or
(ii) proposes to make, or has made, any composition or arrangement with
its creditors or is insolvent or is being or has been wound up or is
otherwise dissolved;
(b) the paid-up share capital of the company is less than the amount
specified in section 21 (2) (a);
(ba) he is satisfied that the company has failed to maintain adequate
provision for depreciation or diminution in the value of its assets
(including provision for bad and doubtful debts), for liabilities which
will or may fall to be discharged by it and for losses which it will or
may incur, (Added 95 of 1911 s. 12)
(c) the objects of the company as stated in its memorandum of
association or constitution no longer include the object of carrying on a
business of taking deposits;
(ca) he is no longer satisfied that the company is a fit and proper body
to be registered; (Added 3 of 1990 s. 15)
(d) it appears to him that-
(i) (Repealed 3 of 1990 s. 15)
(ii) the company has not provided him, whether before or after being
registered, with such information relating to it, and to any circumstances
likely to affect its method of business, as is required by or under this
Ordinance;
(iii) the chief executive of the company, with intent to defeat or delay
its creditors, has departed out of Hong Kong, or being out of Hong Kong
has remained out of Hong Kong, or has departed from his dwelling-place or
usual place of business, or otherwise has failed or refused to attend any
meeting of the governing board, by whatever name called, of the
institution or any meeting otherwise required by or under this Ordinance;
or
(iv) the business of the company is being carried on in a manner
detrimental to the interests of its depositors;
(e) the company has contravened section 14 (1) or (3);
(f) the company has failed to pay the registration fee or renewal of
registration fee in accordance with section 23;
(g) the company has failed to comply with section 60 or Part XVII or
XVIII;
(h) the company makes a report to him under section 67 that it is likely
to become unable to meet its obligations or is about to suspend payment or
it appears to him that the company is so unable or has suspended payment;
(i) the Financial Secretary has referred a report and his recommendation
thereon to the Monetary Authority under section 117 (5) (e). (Amended 82
of 1992 s. 25)
(2) Without limiting the generality of subsection (1), the Monetary
Authority may revoke the registration of a deposit-taking company on being
requested in writing by the company to do so, if he is satisfied that the
interests of depositors of that company are or will be adequately
safeguarded. (Amended 3 of 1990 s. 15; 95 of 1991 s. 12; 82 of 1992 s. 25)
(3) Any company aggrieved by the revocation by the Monetary Authority of
its registration under subsection (1) may appeal to the Governor in
Council against the revocation, but that revocation shall take effect
immediately, notwithstanding that an appeal has been or may be made under
this subsection. (Amended 82 of 1992 s. 25)
32. Revocation of restricted banking licence
(1) Subject to section 33 (1), the Financial Secretary may revoke the
restricted banking licence of a restricted licence bank if-
(a) the restricted licence bank-
(i) has ceased to carry on a business of taking deposits; or
(ii) proposes to make, or has made, any composition or arrangement with
its creditors or is insolvent or is being or has been wound up or is
otherwise dissolved;
(b) the share-capital issued and paid-up of the restricted licence bank
is less than the amount specified in section 25 (2) (a); (Replaced 3 of
1990 s. 16)
(ba) he is satisfied that the restricted licence bank has failed to
maintain adequate provision for depreciation or diminution in the value of
its assets (including provision for bad and doubtful debts), for
liabilities which will or may fall to be discharged by it and for losses
which it will or may incur, (Added 95 of 1991 s. 13)
(c) the objects of the restricted licence bank as stated in its
memorandum of association or constitution no longer include the object of
carrying on a business of taking deposits;
(ca) he is no longer satisfied that the restricted licence bank is a fit
and proper body to be licensed; (Added 3 of 1990 s. 16)
(d) it appears to him that-
(i) (Repealed 3 of 1990 s. 16)
(ii) the restricted licence bank has not provided him, whether before or
after being licensed, with such information relating to it, and to any
circumstances likely to affect its method of business, as is required by
or under this Ordinance;
(iii) the chief executive of the restricted licence bank, with intent to
defeat or delay its creditors, has departed out of Hong Kong, or being out
of Hong Kong has remained out of Hong Kong, or has departed from his
dwelling-place or usual place of business, or otherwise has failed or
refused to attend any meeting of the governing board, by whatever name
called, of the institution or any meeting otherwise required by or under
this Ordinance; or
(iv) the business of the restricted licence bank is being carried on in
a manner detrimental to the interests of its depositors;
(e) the restricted licence bank has contravened section 14 (1) or (3);
(f) the restricted licence bank has failed to pay the restricted banking
licence fee or renewal of restricted banking licence fee in accordance
with section 26; (Replaced 3 of 1990 s. 16)
(g) the restricted licence bank has failed to comply with section 60 or
Part XVII or XVIII;
(h) the restricted licence bank makes a report to the Monetary Authority
under section 67 that it is likely to become unable to meet its
obligations or is about to suspend payment or it appears to the Financial
Secretary that the restricted licence bank is so unable or has suspended
payment; (Amended 82 of 1992 s. 25)
(i) he is of the opinion that, having regard to a report under section
117 in respect of the restricted licence bank, it is proper for him to do
so.
(2) Without limiting the generality of subsection (1), the Financial
Secretary may revoke the restricted banking licence of a restricted
licence bank on being requested in writing by the restricted licence bank
so to do, if he is satisfied that the interests of depositors of that
restricted licence bank are or will be adequately safeguarded. (Amended
95 of 1991 s. 13)
(3) Any restricted licence bank aggrieved by the revocation by the
Financial Secretary of its restricted banking licence under subsection (1)
may appeal to the Governor in Council against the revocation, but that
revocation shall take effect immediately, notwithstanding that an appeal
has been or may be made under this subsection. (Amended 3 of 1990 s. 16)
33. Procedure on and effect of revocation
(1) Before exercising his powers under section 31 (1) or 32 (1), the
Monetary Authority or the Financial Secretary, as the case may be, shall
inform the deposit-taking company or restricted licence bank concerned of
the grounds therefor and give it an opportunity, within such period as the
Monetary Authority or the Financial Secretary, as the case may be, may
specify in writing, being a period reasonable in the circumstances, of
being heard. (Amended 82 of 1992 s. 25)
(2) Where the registration of a deposit-taking company or the restricted
banking licence of a restricted licence bank is revoked the Monetary
Authority shall notify the deposit-taking company or restricted licence
bank, as the case may be, in writing of such revocation and the deposit-
taking company or restricted licence bank, as the case may be, shall, on
and from the date specified in that notice, cease to carry on a business
of taking deposits. (Replaced 3 of 1990 s. 17. Amended 82 of 1992 s. 25)
(3) Without prejudice to any other provision of this Ordinance, a
deposit-taking company or a restricted licence bank referred to in
subsection (2) may continue to hold until maturity any deposit taken prior
to the date referred to in that subsection. (4) Subsection (2) shall not
prejudice the enforcement by any person of any right or claim against the
deposit-taking company or restricted licence bank or by the deposit-taking
company or restricted licence bank of any right or claim against any
person. (Added 3 of 1990 s. 17)
(Amended 3 of 1990 s. 17)
PART VI SUSPENSION OF DEPOSIT-TAKING COMPANY AND RESTRICTED LICEN- CE BANK
(Amended 3 of 1990 s. 18)
34. Interpretation
In this Part, "the designated authority" means the Monetary Authority in
the case of a deposit-taking company, and the Financial Secretary in the
case of a restricted licence bank.
(Amended 3 of 1990 s. 19; 82 of 1992 s. 25)
35. Temporary suspensions
(1) In any case where-
(a) the powers of the designated authority under section 31 (1) or 32
(1) have become exercisable with respect to a deposit-taking company or a
restricted licence bank, as the case may be; and
(b) the designated authority considers that urgent action is expedient,
he may, by notice in writing served on the deposit-taking company or
restricted licence bank-
(i) suspend the registration of the deposit-taking company; or (Replaced
3 of 1990 s. 20)
(ii) suspend the restricted banking licence of the restricted licence
bank, (Replaced 3 of 1990 s. 20) for a period not exceeding 14 days and he
may if he thinks fit, by reason of the urgency of the matter or otherwise,
do so without giving the deposit-taking company or restricted licence
bank, as the case may be, an opportunity to be heard.
(2) Any notice of suspension under subsection (1) may be accompanied by
a notice stating that the designated authority is considering whether to
exercise his powers under section 31 (1), 32 (1) or 36.
(3) Any such accompanying notice as is mentioned in subsection (2) shall
inform the deposit-taking company or restricted licence bank concerned of
its rights under sections 33 (1) and 37 and the manner in which it may
exercise its rights.
(4) Any suspension under this section or section 36 shall cease on such
date prior to the expiration of the period thereof as the designated
authority may, by notice in writing served on the company, determine.
(Amended 3 of 1990 s. 20)
36. Suspensions
(1) Subject to section 37, in any case where the powers of the
designated authority under section 31 (1) or 32 (1) have become
exercisable with respect to a deposit-taking company or restricted licence
bank, as the case may be, the designated authority may, by notice in
writing served on the deposit-taking company or restricted licence bank,
suspend the registration of the deposit-taking company or the restricted
banking licence of the restricted licence bank for a period not exceeding
6 months.
(2) A suspension under this section may, before the expiration of the
period thereof, be renewed by the designated authority-
(a) by notice in writing served on the deposit-taking company or
restricted licence bank the subject of the suspension; and
(b) for a period not exceeding 6 months commencing immediately upon the
expiration of the suspension.
(3) Any deposit-taking company or restricted licence bank aggrieved by
the suspension by the designated authority of its registration or
restricted banking licence under this section may appeal to the Governor
in Council against the suspension, but that suspension shall take effect
immediately, notwithstanding that an appeal has been or may be made under
this subsection.
(Amended 3 of 1990 s. 21)
37. Opportunity of being beard
Before exercising his powers under section 36, the designated authority
shall inform the deposit-taking company or restricted licence bank
concerned of the grounds therefor and give it an opportunity, within such
period as the designated authority may specify in writing, being a period
reasonable in the circumstances, of being heard. (Amended 3 of 1990 s.
22)
38. Effect of suspension
(1) Without prejudice to any other provision of this Ordinance, where
the registration of a deposit-taking company or restricted banking licence
of a restricted licence bank is suspended under section 35 or 36 the
deposit-taking company or restricted licence bank, as the case may be,
shall, on and from the date specified in the notification to it by the
designated authority of such suspension, cease to carry on a business of
taking deposits, until and unless the period of suspension is terminated
without revocation of the registration of the deposit-taking company or
restricted banking licence of the restricted licence bank and without a
further period of suspension under this Part.
(2) Without prejudice to any other provision of this Ordinance, a
deposit-taking company or restricted licence bank referred to in
subsection (1) may continue to hold until maturity any deposit taken prior
to the date referred to in that subsection.
(3) Notwithstanding the suspension of the registration of a deposit-
taking company or the restricted banking licence of a restricted licence
bank, the deposit-taking company or the restricted licence bank shall
continue to be a deposit-taking company or restricted licence bank, as the
case may be, for the purposes of section 23 or 26, as the case may be, and
also of Parts VIII and IX and all the duties imposed on a deposit-taking
company or a restricted licence bank, as the case may be, under this
Ordinance, during the period of its suspension. (Replaced 3 of 1990 s. 23)
(Amended 3 of 1990 s. 23)
PART VII TRANSFER OF LICENCE OR REGISTRATION OF AUTHORIZED INSTI- TUTIONS
39. Interpretation
In this Part-
"designated authority" means-
(a) the Governor in Council in the case of an authorized institution
which is a bank;
(b) the Monetary Authority in the case of an authorized institution
which is a deposit-taking company; and (Amended 82 of 1992 s. 25)
(c) the Financial Secretary in the case of an authorized institution
which is a restricted licence bank.
(Amended 3 of 1990 s. 24; 95 of 1991 s. 14)
40. Transfer of licence or registration
(1) Subject to this Ordinance, the licence or registration of an
authorized institution may be transferred from that institution to another
person.
(2) A transfer of the licence or registration of an authorized
institution shall not take effect until the designated authority grants
the transfer or until such later date as the designated authority
specifies.
41. Application for transfer
(1) The person to whom it is proposed to transfer a licence or
registration shall lodge an application for the transfer of the licence or
registration with the designated authority, which application shall, in
the case of a licence, be made through the Monetary Authority. (Amended 82
of 1992 s. 25)
(2) Subject to such modifications as may be necessary, the provisions
of-
(a) sections 15 to 19 inclusive shall apply to an application for the
transfer of a banking licence as if that application were an application
for the grant of a banking licence under section 15 (1);
(b) sections 20 to 23 inclusive shall apply to an application for the
transfer of registration as if that application were an application for
registration under section 20 (1);
(c) sections 24 to 26 inclusive shall apply to an application for the
transfer of a restricted banking licence as if that application were an
application for the grant of a restricted banking licence under section 24
(1). (Replaced 3 of 1990 s. 25) (d) (Repealed 3 of 1990 s. 25)
42. Certificate of transfer, etc.
Where the designated authority grants the transfer of a licence or of
registration, the Monetary Authority shall- (Amended 82 of 1992 s. 25)
(a) issue a certificate of transfer to the applicant; and
(b) comply with such provisions of section 28 in respect of the transfer
of the licence or registration as he may think appropriate.
43. Liabilities and privileges of transferor and transferee
Upon the issue of a certificate of transfer under section 42-
(a) the applicant shall have and may exercise the same privileges, and
be subject to the same liabilities and penalties, under this Ordinance as
if the licence or registration transferred had been originally granted to
the applicant; and
(b) the person whose licence or registration is transferred shall cease
to be licensed or registered, but the transfer shall not affect the
liability of that or any other person for any act or omission done,
caused, permitted or made prior to the transfer.
PART VIII LOCAL BRANCHES, LOCAL REPRESENTATIVE OFFICES AND FEES
44. Control of establishment, etc. of local branches
(1) An authorized institution shall not establish or maintain any local
branch there of without the approval of the Monetary Authority.
(2) Subsection (1) applies to every authorized institution whether the
institution was licensed or registered before, on or after the
commencement of this Ordinance, and subsections (4) and (5) apply to an
approval granted under subsection (1) whether the approval was granted
before, on or after such commencement.
(3) Approval under subsection (1) shall be deemed to have been granted
in respect of any local branch lawfully established prior to the
commencement of this Ordinance.
(4) The Monetary Authority may at any time, by notice in writing served
upon an authorized institution, attach to an approval granted under
subsection (1), or deemed to have been granted under subsection (3), in
respect of any local branch thereof such conditions, or amend or cancel
any conditions so attached, as he may think proper.
(5) The Monetary Authority may at any time revoke, in such case as he
thinks fit, an approval granted under subsection (1), or deemed to have
been granted under subsection (3), in respect of any local branch.
(6) Where the Monetary Authority refuses to grant approval under
subsection (1) or revokes an approval under subsection (5), he shall
notify the authorized institution concerned in writing of the refusal or
revocation.
(7) Any authorized institution aggrieved by the refusal to grant
approval under subsection (1) or by the revocation of an approval under
subsection (5) by the Monetary Authority, or by any conditions to which an
approval is made subject by the Monetary Authority under subsection (4),
may appeal to the Governor in Council against the refusal, the revocation
or the conditions, but that refusal, that revocation or, as the case may
be, those conditions shall take effect immediately, notwithstanding that
an appeal has been or may be made under this subsection.
(8) Every director and every manager of an authorized institution which
contravenes subsection (1) or any condition attached under subsection (4)
commits an offence and is liable-
(a) on conviction upon indictment to a fine of $ 200,000; or
(b) on summary conviction to a fine of $ 50,000, and, in the case of a
continuing offence, to a further fine of $ 5,000, for every day during
which the offence continues. (Amended 82 of 1992 s. 25)
45. Fees in respect of local branches
(1) Where the establishment by an authorized institution of a local
branch is approved under section 44, the institution shall pay to the
Director of Accounting Services the fee specified in the Second Schedule
in relation to that branch and thereafter, so long as the branch continues
to be maintained by the institution, it shall pay to the Director of
Accounting Services the fee specified in the Second Schedule on the
anniversary in each year of the date on which the institution was licensed
or registered, as the case may be.
(2) An authorized institution that is maintaining, at the commencement
of this Ordinance, a local branch to which section 44 (3) applies shall,
so long as the branch continues to be maintained by the institution, pay
to the Director of Accounting Services the fee specified in the Second
Schedule on the anniversary in each year of the date on which the
institution was licensed or registered, as the case may be.
46. Control of establishment, etc. of local representative offices
(1) A bank incorporated outside Hong Kong which is not licensed under
section 16 and is not recognized as the central bank of the place in which
it is incorporated shall not establish or maintain any local
representative office thereof without the approval of the Monetary
Authority.
(2) Approval under subsection (1) shall be deemed to have been granted
in respect of any local representative office lawfully established prior
to the commencement of this Ordinance.
(3) Approval under subsection (1) shall not be granted unless the
Monetary Authority is satisfied that the bank is adequately supervised by
a recognized banking supervisory authority of the place in which the bank
is incorporated or established.
(4) The Monetary Authority may at any time, by notice in writing served
upon a bank, attach to an approval granted under subsection (1), or deemed
to have been granted under subsection (2), in respect of any local
representative office thereof such conditions, or amend or cancel any
conditions so attached, as he may think proper.
(5) The Monetary Authority may at any time revoke, in such case as he
thinks fit, an approval granted under subsection (1), or deemed to have
been granted under subsection (2), in respect of any local representative
office.
(6) Where the Monetary Authority refuses to grant approval under
subsection (1) or revokes an approval under subsection (5), he shall
notify the bank concerned in writing of the refusal or revocation.
(7) Any bank aggrieved by the refusal to grant approval under subsection
(1) or by the revocation of an approval under subsection (5) by the
Monetary Authority, or by any conditions to which an approval is made
subject by the Monetary Authority under subsection (4), may appeal to the
Governor in Council against the refusal, the revocation or the conditions,
but that refusal, that revocation or, as the case may be, those conditions
shall take effect immediately, notwithstanding that an appeal has been or
may be made under this subsection.
(8) Any person in charge, or who appears to be in charge, of a local
representative office established or maintained in contravention of
subsection (1) or in respect of which any condition attached under
subsection (4) is contravened, commits an offence and is liable-
(a) on conviction upon indictment to a fine of $ 200,000; or
(b) on summary conviction to a fine of $ 50,000, and, in the case of a
continuing offence, to a further fine of $ 5,000 for every day during
which the offence continues. (Amended 82 of 1992 s. 25)
47. Supply of information and examination of local representative
offices
(1) A bank incorporated outside Hong Kong which maintains a local
representative office thereof pursuant to section 46 shall-
(a) submit to the Monetary Authority such information as he may require
regarding the functions and activities of the representative office;
(b) if the Monetary Authority wishes to examine the functions and
activities of the representative office, for that purpose afford to the
person carrying out the examination access to the documents maintained by
the representative office and to such information and facilities as may be
required to conduct the examination, and shall produce to the person
carrying out the examination such documents or other information as he may
require. (Amended 82 of 1992 s. 25)
(2) Any person who fails to comply with any requirement of the Monetary
Authority under this section commits an offence and is liable- (Amended 82
of 1992 s. 25)
(a) on conviction upon indictment to a fine of $ 200,000; or
(b) on summary conviction to a fine of $ 50,000, and, in the case of a
continuing offence, to a further fine of $ 5,000 for every day during
which the offence continues.
(3) Any person who signs any document for the purposes of this section
which he knows or reasonably ought to know to be false in a material
particular commits an offence and is liable-
(a) on conviction upon indictment to a fine of $ 500,000 and to
imprisonment for 2 years; or
(b) on summary conviction to a fine of $ 50,000 and to imprisonment for
6 months.
(4) If a bank produces any book, account, document, security or
information whatsoever under this section which is false in a material
particular, every director and every manager of the bank commits an
offence and is liable-
(a) on conviction upon indictment to a fine of $ 500,000 and to
imprisonment for 2 years; or
(b) on summary conviction to a fine of $ 50,000 and to imprisonment for
6 months.
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