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STAMP DUTY ORDINANCE
STAMP DUTY ORDINANCE
(CHAPTER 117)
CONTENTS
Section
PART I PRELIMINARY
1. Short title
2. Interpretation
3. Collector of Stamp Revenue and assistant collectors
PART II CHARGING AND STAMPING OF INSTRUMENTS
4. Charging of, liability for, and recovery of stamp duty
5. Methods of stamping and denoting
5A. Collection agreement with the Exchange Company
6. Cancellation of adhesive stamps
7. Licensing and use of franking machines
8. Duplicates and counterparts
9. Late stamping
10. How instruments to be written, charged and stamped
11. Facts and circumstances affecting stamp duty to be set forth
12. Power to call for abstract and evidence
13. Adjudication of stamp duty by Collector
14. Appeal against assessment
15. Non-admissibility etc. of instruments not duly stamped
16. Provisions relating to certain leases etc.
17. Instrument increasing rent to be chargeable as a lease
18. Calculation of stamp duty as regards foreign currency
PART III ANCILLARY PROVISIONS RELATING TO PART II
19. Contract notes in respect of sale and purchase of Hong Kong stock 19A.
Refund of stamp duty in respect of sale and purchase of units under unit
trust schemes
20. Stamp duty payable where transaction in respect of Hong Kong stock
does not amount to jobbing business
21. Passing on of dividends or interest on Hong Kong stock prohibited
22. Stamp duty chargeable where consideration in respect of immovable
property consists of stock or security other than stock
23. How consideration consisting of periodical payments to be charged
24. Stamp duty chargeable where conveyance etc. is in consideration of
debt etc.
25. Stamp duty chargeable in case of certain conveyances
26. Stamp duty chargeable on contracts etc. for sale of equitable estate
or interest in immovable property
27. Voluntary dispositions
28. Stamp duty chargeable in case of conveyance or transfer in
contemplation of sale or subject to power of revocation etc.
29. Certificate with respect to certain conveyances on sale
PART IIIA AGREEMENTS TO SELL IMMOVABLE PROPERTY
29A. Interpretation and application of Part III A
29B. Duty to execute agreement for sale
29C. Chargeable agreements for sale
29D. Conveyances on sale of residential property
29E. Section 26 inapplicable to certain agreements
29F. Voluntary chargeable agreements for sale
29G. Certificate with reference to certain agreements for sale
29H. Exemptions and relief
29I. Expiration of this Part and head 1 (1A) in First Schedule
PART IV UNIT TRUSTS
30. Interpretation of Part IV
31. Duty of trustees and managers to keep records
32. Numbering and preservation of certificates and instruments of transfer
33. Register of holders of registered units
34. Register of certificates to bearer
35. Form and period of preservation of records
36. Restriction on registration of transfer of units
37. Penalty
PART V EXEMPTION AND RELIEF
38. Interpretation of Part v
39. Instruments generally exempted
40. Instruments specially exempted
41. Non-liability of Government or public officer for payment of stamp
duty
42. Relief in case of certain leases etc. to Government
43. Relief in case of certain leases etc. of consular premises
44. Relief in case of gift to exempted institution
45. Relief in case of conveyance from one associated body corporate to
another
46. Instruments affecting immovable property made for new Crown lease or
exchange to be exempt
47. Instruments confirmatory of transactions during Japanese occupation to
be exempt
PART VI ALLOWANCE FOR SPOILED OR UNWANTED STAMPS
48. Allowance for spoiled stamps
49. Allowance for misused stamps
50. Allowance for unwanted adhesive stamps
51. Manner of making, and time for taking up, allowance
PART VII MISCELLANEOUS
52. Remission of stamp duty
53. Liability for offences by bodies corporate
54. Inspection of books of account etc.
55. Falsification
56. Offences relating to stamps
57. Power of magistrate in relation to stolen stamps
58. Defacement of adhesive stamps
58A. Representations may be made to Collector before certain penalties are
imposed
59. Fraudulent practices
60. Punishment for offences
61. Limitation of time for proceedings in respect of offences
62. Responsibility for loss of or damage to instrument
63. Regulations
64-65. (Have had effect)
66. Transitional
First Schedule
Second Schedule
Third Schedule
To consolidate and amend the law relating to stamp duty.
[1 July 1981] L. N. 173 of 1981
PART I PRELIMINARY
1. Short title
This Ordinance may be cited as the Stamp Duty Ordinance.
2. Interpretation
(1) In this Ordinance, unless the context otherwise requires-
"adhesive stamp" has the meaning assigned to it by section 5 (3);
"assessment" means an assessment made by the Collector under section 13 as
to the amount of stamp duty chargeable on an instrument, and "assessed"
has the corresponding meaning;
"bearer instrument" means any instrument to bearer by delivery of which
any stock can be transferred, but does not include an instrument relating
to stock which consists of a loan expressed in terms other than in the
currency of Hong Kong except to the extent that the loan is repayable, or
may at the option of any person be repaid, in the currency of Hong Kong;
(Amended 77 of 1981 s. 2)
"broker" means a person who is a member of the Unified Exchange; (Amended
67 of 1989 s. 2)
"chargeable" means chargeable under this Ordinance;
"Collector" means the Collector of Stamp Revenue appointed under section
3; "contract note" means a contract note required to be made and executed
under section 19 (1);
"conveyance" means every instrument (including a surrender) and every
decree or order of any court whereby any immovable property is transferred
to or vested in any person; "conveyance on sale" means every conveyance
whereby any immovable property, upon the sale thereof, is transferred to
or vested in a purchaser or any other person on his behalf or by his
direction, and includes a foreclosure order;
"duly stamped", in relation to an instrument, means, duly stamped under
this Ordinance in respect of the stamp duty chargeable on such instrument;
"Exchange Company" means the company recognized under section 3 of the
Stock Exchanges Unification Ordinance (Cap. 361) as the Exchange
Company for the purposes of that Ordinance; (Added 85 of 1992 s. 2)
"executed" and "execution", in relation to an instrument not under seal,
mean signed and signature respectively;
"foreclosure order" means every order or decree for, or having the effect
of an order for, foreclosure;
"Hong Kong bearer instrument" means a bearer instrument issued-
(a) in Hong Kong; or
(b) elsewhere by or on behalf of a body corporate formed, or an
unincorporated body of persons established, in Hong Kong;
"Hong Kong stock" means stock the transfer of which is required to be
registered in Hong Kong;
"instrument" includes every written document;
"instrument of transfer" means an instrument by means of which any Hong
Kong stock is transferred, and includes a letter of renunciation;
"Japanese House Registration Office" means the office in which during the
Japanese occupation of Hong Kong were kept the registers or records of
houses and buildings and documents relating thereto;
"jobbing business" means any business carried on by a broker which is
specified as jobbing business by regulations made under section 63;
"lease" does not include mortgage by demise;
"loan capital" means any debenture, debenture stock, corporation stock or
funded debt (by whatever name known) issued by any body, whether corporate
or unincorporate, or any capital raised by any such body, being capital
which is borrowed or has the character of borrowed money, but does not
include any such investment which-
(a) carries a right of conversion into stock or to the acquisition of any
stock; or
(b) carries or has carried a right to interest the amount of which-
(i) exceeds a reasonable commercial return on the nominal amount of the
capital; or
(ii) falls or has fallen to be determined to any extent by reference to
the results of, or of any part of, a business or to the value of any
property; or
(c) carries a right on repayment to an amount which exceeds the nominal
amount of the capital and is not reasonably comparable with what is
generally repayable in respect of a similar nominal amount of capital
under the terms of issue of loan capital listed on the Unified Exchange;
(Amended 77 of 1981 s. 2; 67 of 1989 s. 2)
"stamp" means any of the following-
(a) an adhesive stamp;
(b) a stamp (other than an adhesive stamp) used or intended for use for
denoting the payment or remission of stamp duty, or the payment or
remission of any penalty, or the payment of an adjudication fee, payable
under this Ordinance or the fact that any instrument is not chargeable
with stamp duty or is duly stamped;
(c) any mark made or indication given by a stamp referred to in paragraph
(b);
(d) an imprint on a contract note to which an agreement under section
5A relates of the amount of the stamp duty chargeable thereon together
with an endorsement made under section 5 (2A) on such note; (Added 85 of
1991 s. 2)
"stamp duty" means stamp duty chargeable under this Ordinance;
"stamped" means stamped by means of a stamp under this Ordinance;
"stock" means any of the following investments-
(a) any shares, stocks, debentures, loan stocks, funds, bonds or notes of
or issued by any body, whether corporate or unincorporate, or any
government or local government authority, or any other similar investment
of any description;
(b) any units under a unit trust scheme;
(c) any right, option or interest in or in respect of any stock referred
to in paragraph (a) or (b), other than any such right, option or interest
under an employees' share purchase or share option scheme, (Replaced 36 of
1992 s. 2)
but, except for the purposes of section 22, does not include any loan
capital, or any bill of exchange or promissory note, or any certificate of
deposit within the meaning of section 2 of the Inland Revenue Ordinance
(Cap. 112) or any Exchange Fund debt instrument or Hong Kong dollar
denominated multilateral agency debt instrument within the meaning of that
Ordinance, or any bond issued under the Loans Ordinance (Cap. 61), or any
debentures, loan stocks, funds, bonds or notes denominated otherwise than
in the currency of Hong Kong except to the extent that the same shall be
redeemable, or may at the option of any person be redeemed, in the
currency of Hong Kong; (Amended 77 of 1981 s. 2; 29 of 1984 s. 2; 10 of
1990 s. 2; 43 of 1991 s. 2; 49 of 1991 s. 2; 18 of 1992 s. 2)
"time for stamping", in relation to an instrument, has the meaning
assigned to it by section 4 (2);
"Unified Exchange" means the stock market established under section 27 of
the Stock Exchanges Unification Ordinance (Cap. 361); (Added 67 of 1989 s.
2) "unit" and "unit trust scheme" have the meanings assigned thereto
respectively by section 30.
(Amended 67 of 1989 s. 2)
(2) Where it is provided in any other Ordinance that stamp duty shall not
be payable in respect of any instrument, such instrument shall not be
chargeable with stamp duty under this Ordinance.
(3) Where it is provided in this Ordinance that an instrument shall not be
duly stamped unless any condition specified in that provision is
fulfilled, the fulfilment of that condition shall not affect the
application to that instrument of any other such provision of this
Ordinance whereby any other condition is required to be fulfilled in
respect of that instrument.
(4) Until Part IV comes into operation, the definition of "stock" in
subsection (1) shall be construed as if paragraph (b) and references
thereto in that definition were omitted.
3. Collector of Stamp Revenue and assistant collectors
(1) There shall be a Collector of Stamp Revenue who shall be appointed by
the Governor, and such number of assistant collectors as the Governor may
appoint for the purposes of this Ordinance.
(2) The office of the Collector shall be at such place as the Collector
may determine.
(3) A reference in any provision in this Ordinance to the Collector shall,
in relation to the exercise of any function conferred by that provision on
the Collector, include a reference to any assistant collector who is for
the time being authorized in writing by the Collector to exercise such
function.
(4) Any person appointed under section 2 of the Stamp Ordinance (Cap. 117,
1978 Ed.) as Collector of Stamp Revenue or assistant collector and holding
such office immediately before the commencement of this Ordinance shall be
deemed to be appointed under this section as Collector of Stamp Revenue or
assistant collector, as the case may be.
PART II CHARGING AND STAMPING OF INSTRUMENTS
4. Charging of, liability for, and recovery of stamp duty
(1) Subject to this Ordinance, every instrument, wherever executed,
specified in the First Schedule shall be chargeable with the stamp duty
specified in respect thereof in that Schedule, and the headings, notes and
explanations in that Schedule shall have effect accordingly.
(2) Subject to this Ordinance, the time for stamping any instrument shall
be the point of time or, as the case may be, the period of time specified
in respect thereof in the First Schedule; and where it is provided in that
Schedule that the point of time for stamping any instrument is to be
before execution, such provision shall not be construed as prohibiting the
stamping of such instrument after execution.
(3) If any instrument chargeable with stamp duty is not duly stamped, the
person or persons respectively specified in section 13 (10), 19 or 20 or
the First Schedule as being liable for stamping such instrument, and any
person who uses such instrument, shall be liable, or jointly and severally
liable, as the case may be, civilly to the Collector for the payment of
the stamp duty and any penalty payable under section 9, and may be
proceeded against without reference to any civil liability of such persons
inter se for the payment thereof.
(3A) A contract note which is stamped in accordance with section 5 (2A)
shall, if the amount of the stamp duty imprinted on the note has not been
paid to the Collector in the manner provided by an agreement entered into
under section 5A, be deemed for the purposes of subsection (3) to be an
instrument chargeable with stamp duty which is not duly stamped. (Added 85
of 1991 s. 3)
(4) If a contract note is not made and executed as required by section 19
(1), the person specified in the First Schedule as being liable for
stamping such note shall be liable civilly to the Collector for the
payment of the stamp duty chargeable thereon and any penalty payable under
section 9.
(5) No action shall be brought by virtue of subsection (3) or (4) or
section 45 (5A) (c) for the recovery of any stamp duty with respect to any
instrument more than 6 years from the expiration of the time for stamping
such instrument. (Amended 43 of 1991 s. 3)
(6) Notwithstanding anything in this section, the Collector may agree to
accept payment of any stamp duty or penalty by instalments.
(7) The prescribed particulars required by section 45 (2) of the Companies
Ordinance (Cap. 32) to be delivered to the Registrar of Companies for
registration in respect of any contract mentioned in subsection (1) (b) of
that section which is not reduced to writing shall be chargeable with the
same stamp duty as would have been payable if the contract had been
reduced to writing, and subsections (2), (3), (5) and (6) of this section
shall apply to the prescribed particulars as they apply to any such
contract in writing.
(8) Where, after the commencement of this Ordinance, any immovable
property or Hong Kong stock is transferred to or vested in any person by
virtue of any Ordinance, whether commencing before or after this
Ordinance, such person shall within 30 days after the commencement of the
Ordinance or the date of vesting, whichever is the later, cause an
authentic copy of the Ordinance (including any subsidiary legislation
giving effect to the vesting) to be stamped with the stamp duty chargeable
on a conveyance or transfer of immovable property or Hong Kong stock as
the case may be; and such person shall, for the purposes of subsection
(3), be the person liable for stamping with respect to such copy.
5. Methods of stamping and denoting
(1) Subject to this section and section 9, every instrument chargeable
with stamp duty shall be presented to the Collector for stamping and, upon
payment of the stamp duty, he shall stamp such instrument or cause it to
be stamped- (Amended 77 of 1981 s. 3)
(a) by means of a franking machine with the amount of stamp duty paid and
the date of stamping; or
(b) by means of a stamp approved by the Collector with the words "Stamp
Office Hong Kong" and the date of stamping, and, in the case of an
instrument stamped under paragraph (b), the Collector shall at the same
time record on the instrument, as close as possible to the date so
stamped, the amount of stamp duty paid together with his signature.
(2) Any instrument chargeable with stamp duty under head 2 (1) in the
First Schedule may be stamped by means of an adhesive stamp by any person
authorized in that behalf by the Collector who purchases such stamp at the
office of the Collector.
(2A) Notwithstanding subsection (2), a contract note to which an agreement
under section 5A relates may be stamped by imprinting on such note, by any
person authorized in that behalf by the Collector and in such manner as
the Collector may think fit, the amount of stamp duty chargeable thereon
and making an endorsement on such note by such person, in such manner as
the Collector may think fit, to the effect that the amount of the stamp
duty so imprinted has been or will be paid through the Exchange Company
under such agreement. (Added 85 of 1991 s. 4)
(2B) Subject to section 4 (3A), a contract note stamped in accordance with
subsection (2A) shall be treated as duly stamped with the amount of the
stamp duty imprinted thereon, and within the time for stamping such note.
(Added 85 of 1991 s. 4)
(2C) Any person who-
(a) makes an endorsement for the purposes of subsection (2A) without
authorization from the Collector in that behalf; or
(b) makes such an endorsement which is false in a material particular,
commits an offence. (Added 85 of 1991 s. 4)
(3) Adhesive stamps used for the purposes of subsection (2) shall be of
such kinds and in such denominations as the Collector may determine.
(4) Subject to section 7, any instrument chargeable with stamp duty under
head 2 (4) in the First Schedule may be stamped by means of a franking
machine by any person to whom a licence in respect of such machine is
issued under that section.
(5) In respect of any Hong Kong bearer instrument, the following shall
apply-
(a) such instrument shall, before being issued, be produced to the
Collector together with such particulars in writing in respect of the
instrument as the Collector may require, and such instrument shall be duly
stamped if it is stamped with a particular stamp approved by the Collector
denoting that it has been so produced; and
(b) within 2 months of the date on which such instrument is issued, or
such longer time as the Collector may allow, a statement in writing
containing the date of issue and such further particulars as the Collector
may require in respect of such instrument shall be delivered to the
Collector, and the stamp duty chargeable on such instrument shall be paid
to the Collector on delivery of that statement or within such longer time
as the Collector may allow, and if default is made in complying with
paragraph (a) or (b) in respect of such instrument, or if any particulars
so produced or delivered in respect of such instrument are false in any
material respect, the person or persons respectively specified in head 3
in the First Schedule as being liable for stamping such instrument shall
incur a penalty of 10 times the amount of the stamp duty chargeable on
such instrument which shall be recoverable by the Collector as a civil
debt due to the Crown.
(6) Where the stamp duty chargeable on an instrument depends in any manner
upon the stamp duty paid in respect of another instrument, the payment of
the last- mentioned stamp duty shall, upon application to the Collector
and production of both the instruments, be denoted upon the
first-mentioned instrument in such manner as the Collector thinks fit.
(7) If an instrument is presented to the Collector for stamping and the
Collector, acting under section 12, requires to be furnished with an
abstract of the instrument or with some evidence, then unless such an
abstract or that evidence is furnished as required the Collector-
(a) may refuse to stamp the instrument; or
(b) may stamp the instrument subject to such conditions as he sees fit.
(Added 8 of 1992 s. 2)
5A. Collection agreement with the Exchange Company
(1) The Collector may enter into an agreement with the Exchange Company
for the collection, in accordance with the provisions of this Ordinance
and such agreement, of the stamp duty chargeable under head 2 (1) in the
First Schedule on such contract notes as may be specified in the
agreement.
(2) An agreement under this section shall provide-
(a) for every contract note to which the agreement relates to bear on its
face an imprint of the amount of the stamp duty chargeable on such note;
(b) for the delivery to the Collector, by the Exchange Company, of
periodical accounts in respect of contract notes to which the agreement
relates, giving such particulars with respect thereto as may be specified
in the agreement; and
(c) for the payment to the Collector, by the Exchange Company and on the
delivery of any such account, of the aggregate amount of the stamp duty
chargeable as mentioned in subsection (1) on contract notes to which the
agreement relates during the period to which the account relates, and any
such agreement may contain such other terms and conditions as the
Collector thinks fit.
(3) If default is made in delivering any account required by an agreement
under this section, or in paying any amount in accordance with such an
agreement, the Exchange Company shall be liable to penalty of $1,000 for
each day during which the default continues, and, in addition, every
amount payable under such an agreement shall bear interest at the rate of
3 cents per $100 or part thereof per day, from the due date for delivery
of the account by reference to which it is payable until the actual date
of payment.
(4) The penalty and interest under subsection (3) shall be recoverable as
a civil debt due to the Crown.
(Added 85 of 1991 s. 5)
6. Cancellation of adhesive stamps
(1) Every adhesive stamp used to denote the payment of stamp duty under
section 5 (2) shall be canceled forthwith by the person affixing it in
such manner as to render it incapable of being used again for any revenue
purpose.
(2) An instrument stamped by means of an adhesive stamp shall not be duly
stamped unless the adhesive stamp is cancelled as required by subsection
(1).
7. Licensing and use of franking machines
(1) The Collector may issue a licence to any person in the form in Part 1
of the Second Schedule authorizing such person to use a franking machine
for the purpose of stamping any instrument under section 5 (4).
(2) No person shall use a franking machine for the purpose of stamping any
instrument under section 5 (4)-
(a) without a licence; or
(b) otherwise than in accordance with the conditions set out in Part 1 of
the Second Schedule or such additional or other conditions as the
Collector may impose in respect of such licence; or
(c) unless at the time it stamps such instrument the machine stamps the
date of stamping thereon.
(3) The general provisions in Part 2 of the Second Schedule shall have
effect in relation to every licence and licensed franking machine.
(4) No person other than the Collector or an authorized officer shall
break or in any way interfere with any seal affixed to a licensed franking
machine for the purposes of this section by the Collector or an authorized
officer.
(5) The Collector may cancel a licence at any time if there are reasonable
grounds for believing that-
(a) any person has used the licensed franking machine in contravention of
subsection (2) (b) or (c) or has broken or interfered with any seal
affixed thereto in contravention of subsection (4); or
(b) the licensed franking machine is capable of making an imperfect stamp;
or
(c) the licensed franking machine has not been used for a period of not
less than 6 months.
(6) Any person who contravenes subsection (2) or (4) commits an offence.
(7) Whenever in any prosecution for an offence against subsection (2) it
is proved that the accused had in his possession a franking machine, it
shall be presumed unless the contrary is proved that such machine was used
for the purpose of stamping an instrument under section 5 (4).
(8) Any franking machine in respect of which an offence is committed
against subsection (2) shall, upon application by the Collector to a
magistrate, be forfeited whether or not any person is convicted in respect
of such offence.
(9) In this section-
"authorized officer" means a public officer authorized in writing by the
Collector for the purposes of this section;
"licence" means a licence issued by the Collector under subsection (1),
and "licensed" shall be construed accordingly.
8. Duplicates and counterparts
The duplicate or counterpart of an instrument chargeable with stamp duty
shall not be duly stamped unless it is stamped as an original instrument
or there is denoted thereon payment of the stamp duty paid in respect of
the original instrument of which it is the duplicate or counterpart.
9. Late stamping
(1) Except in the case of an instrument to which section 5 (5) or 13 (7)
(a) applies, any instrument chargeable with stamp duty which is not
stamped before or within the time for stamping such instrument shall not
be stamped except by the Collector upon payment of the stamp duty and a
penalty of whichever of the following amounts applies- (Amended 77 of
1981 s. 4)
(a) if the instrument is so stamped not later than 1 month after the time
for stamping, the penalty shall be double the amount of the stamp duty;
(b) if the instrument is so stamped later than 1 month but not later than
2 months after the time for stamping, the penalty shall be 4 times the
amount of the stamp duty;
(c) in any other case, the penalty shall be 10 times the amount of the
stamp duty.
(2) The Collector may remit the whole or any part of any penalty payable
under subsection (1).
(3) The payment or remission of a penalty payable under this section in
respect of any instrument may be denoted thereon by the Collector in such
manner as he thinks fit.
10. How instruments to be written, charged and stamped
(1) Every instrument chargeable with stamp duty shall be so written that
the stamp may appear on the face of the instrument and cannot be used for
or applied to any other instrument.
(2) Every instrument chargeable with stamp duty containing or relating to
several distinct matters shall be separately and distinctly charged, as if
it were a separate instrument, with stamp duty in respect of each of the
matters.
(3) Every instrument chargeable with stamp duty shall be separately and
distinctly stamped with the stamp duty chargeable thereon.
(4) Subject to section 16 (1), an instrument made for any consideration by
reference to which it is chargeable with stamp duty, and also for any
further or other valuable consideration or considerations, shall be
separately and distinctly charged, as if it were a separate instrument,
with stamp duty in respect of each of the considerations.
11. Facts and circumstances affecting stamp duty to be set forth
(1) All the facts and circumstances affecting the liability of any
instrument to stamp duty, or the amount of the stamp duty chargeable on an
instrument, are to be fully and truly set forth in the instrument.
(2) Any person who with intent to defraud the Government-
(a)executes any instrument in which all the said facts and circumstances
are not fully and truly set forth; or
(b) being employed or concerned in or about the preparation of any
instrument, neglects or omits fully and truly to set forth therein all the
said facts and circumstances, commits an offence.
(3) The Collector may, before the commencement of criminal proceedings,
compound any offence against subsection (2).
12. Power to call for abstract and evidence
Whenever any instrument is presented to the Collector for stamping, the
Collector may require to be furnished with an abstract of the instrument
and also with such evidence as he may deem necessary in order to show to
his satisfaction whether all the facts and circumstances affecting the
liability of the instrument to stamp duty, or the amount of the stamp duty
chargeable thereon, are fully and truly set forth therein.
13. Adjudication of stamp duty by Collector
(1) In respect of any executed instrument, the Collector may, and shall if
he is required by any person upon payment of an adjudication fee of $20 to
do so, express his opinion with reference to such instrument upon the
following questions-
(a) whether it is chargeable with any stamp duty;
(b) what amount of stamp duty is chargeable thereon.
(2) Any instrument in respect of which the adjudication fee is paid under
subsection (1) shall be stamped with a stamp approved by the Collector
denoting the payment thereof.
(3) If the Collector is of opinion that the instrument-
(a) is not chargeable with stamp duty, it may, subject to subsection (4),
be stamped with a stamp approved by the Collector denoting that it is not
chargeable with stamp duty;
(b) is chargeable with stamp duty, he shall assess the stamp duty payable,
and, subject to subsection (7), where the instrument is stamped under
section 5 with a stamp denoting payment of the stamp duty so assessed it
may also be stamped with a stamp approved by the Collector denoting that
it is duly stamped.
(4) Subject to this section, an instrument upon which the stamp duty has
been assessed by the Collector shall not, if it is not stamped or is
insufficiently stamped, be stamped otherwise than in accordance with the
assessment; and in the case of any instrument which in the opinion of the
collector is not chargeable with stamp duty, such instrument shall not be
stamped under subsection (3) (a) unless it is stamped under subsection (2)
with the stamp denoting payment of the adjudication fee or section 40
applies.
(5) Section 12 shall apply in relation to an instrument in respect of
which the Collector intends or is required to express his opinion under
subsection (1) as it applies to an instrument presented to him for
stamping, and where the Collector requires a statutory declaration to be
made for the purposes of this section-
(a) such declaration shall not be used against the person making it in any
proceeding whatever except in an inquiry as to the stamp duty with which
the instrument to which it relates is chargeable; and
(b) unless such declaration is shown not to be true in any material
respect, the person by whom it is made shall, on payment of the stamp duty
chargeable upon the instrument, be relieved from any punishment to which
he may be liable under section 11.
(6) Every instrument stamped under this section with a stamp denoting that
it is not chargeable with stamp duty or that it is duly stamped shall be
admissible in evidence and available for all purposes notwithstanding any
objection relating to stamp duty.
(7) Where in respect of any instrument which is not stamped the Collector
is required by any person under this section before or within the time for
stamping such instrument to express his opinion under subsection (1) and
such instrument is in the opinion of the Collector chargeable with stamp
duty, the instrument-
(a) may be stamped upon payment of the stamp duty if the stamp duty is
paid not later than the time for stamping such instrument or the
expiration of a period of 1 month from the date on which the assessment of
the stamp duty is made, whichever is the later; or
(b) if the stamp duty is not so paid, may be so stamped thereafter upon
payment of the stamp duty and a penalty calculated under section 9 and,
for that purpose, section 9 shall apply in relation to the stamping of
such instrument as it applies in relation to the stamping of an instrument
chargeable with stamp duty which is not stamped before or within the time
for stamping such instrument.
(8) Where notice of an assessment of the stamp duty chargeable on any
instrument is, within 7 days from the date on which the assessment is
made, served by registered post on any person who required the Collector
to express his opinion with reference thereto under subsection (1) or who
is liable for stamping such instrument, such assessment shall, after the
expiration of a period of 1 month from that date, be final and conclusive
for all purposes as against such person except if and to the extent that
an appeal made against it under section 14 succeeds.
(9) If, within a period of 1 month from the date on which an assessment is
made of the stamp duty chargeable on any instrument, it appears to the
Collector that the amount of the stamp duty so assessed is excessive, he
may cancel such assessment and make such other assessment in substitution
therefor as he may deem proper; and any reference in this Ordinance to an
assessment shall be construed as including a reference to an assessment as
so substituted.
(10) Where the payment of stamp duty is denoted on any instrument
chargeable with stamp duty in respect of which the Collector expresses or
is required to express his opinion under subsection (1) and the amount of
the payment so denoted is less than the amount assessed by the Collector,
then, without prejudice to the liability of any person for the payment of
the difference between the amount of the stamp duty so denoted and the
assessment, the instrument shall be chargeable, unless it is stamped in
respect of the difference not later than 1 month from the date on which
the assessment is made, with additional stamp duty of an amount equal to
interest on the amount of the difference at the rate of 4 cents per $100
or part thereof per day in respect of the period beginning on the
expiration of a period of 1 month from that date and ending on the date of
the payment of such additional stamp duty; and the person or persons
liable for stamping such instrument in respect of the stamp duty so
assessed shall be the person or persons liable for stamping it in respect
of such additional stamp duty.
(11) The Collector may remit, wholly or in part, any additional stamp duty
payable under subsection (10).
14. Appeal against assessment
(1) Any person who is dissatisfied with the assessment of the Collector
under section 13 may, within a period of 1 month from the date on which
the assessment is made and on payment of the stamp duty in conformity
therewith, appeal against the assessment to the court and may for that
purpose require the Collector to state and sign a case setting forth the
question upon which his opinion was required and the assessment made by
him.
(2) The Collector shall thereupon state and sign a case and deliver
the same to the person by whom it is required and the case may, within 7
days thereafter and after service thereof upon the Attorney General, be
set down by such person for hearing.
(3) Upon the hearing of the case the court shall determine the question
submitted, and, if the instrument in question is in the opinion of the
court chargeable with any stamp duty, the court shall assess the stamp
duty chargeable thereon.
(4) If the amount of the stamp duty assessed by the court is less than the
assessment of the Collector, the excess of stamp duty paid shall be
ordered by the court to be repaid together with any excess of penalty paid
under section 9 in respect thereof.
(5) If in the opinion of the court the assessment of the Collector is not
excessive, the court shall make an order confirming that assessment.
(5A) The court may appoint a member of the Lands Tribunal to sit and
assist it in any proceedings or part of any proceedings under this
section; but the decision in the appeal shall be the decision of the court
alone. (Added 43 of 1984 s. 2)
(6) In this section "court" means the District Court.
15. Non-admissibility etc. of instruments not duly stamped
(1) No instrument chargeable with stamp duty shall be received in evidence
in any proceedings whatsoever except-
(a) criminal proceedings;
(b) civil proceedings by the Collector to recover stamp duty or any
penalty payable under this Ordinance,
or be available for any other purpose whatsoever, unless such instrument
is duly stamped:
Provided that an instrument which is not duly stamped may be received in
evidence in civil proceedings before a court if the court so orders upon
the personal undertaking of a solicitor to cause-
(i) such instrument to be stamped in respect of the stamp duty chargeable
thereon; and
(ii) any penalty payable under section 9 in respect thereof to be paid.
(2) Subject to subsection (3), no instrument chargeable with stamp duty
shall be acted upon, filed or registered by any public officer or body
corporate unless such instrument is duly stamped; and any such public
officer who or body corporate which fails to comply with this subsection
shall incur a penalty of $1,000 which shall be recoverable by the
Collector as a civil debt due to the Crown.
(3) Subsection (2) does not apply in relation to the registration of-
(a) an instrument under the Land Registration Ordinance (Cap. 128) if the
instrument is stamped under section 5 (1) or 13 (2), or is an agreement
for sale that contains a statement to the effect that it relates to non-
residential property within the meaning of section 29A (1); or (Amended 8
of 1992 s. 3)
(b) an instrument of transfer if the instrument is stamped under section
13 (2), but the registration does not affect the question of whether the
instrument is duly stamped. (Replaced 43 of 1991 s. 4)
(4) If a public officer is empowered or required by law to act upon, file
or register a duplicate or copy of any instrument, and if the original of
such instrument would require to be duly stamped if acted upon, filed or
registered by such public officer, it shall be lawful for such public
officer to call for the production of the original instrument, or for
evidence to his satisfaction that it is duly stamped, and no public
officer shall act upon, file or register any such duplicate or copy
without production of the original instrument duly stamped or of evidence
as aforesaid.
16. Provisions relating to certain leases etc.
(1) A lease or agreement for a lease shall not be charged with stamp duty
in respect of any penal rent, or increased rent in the nature of a penal
rent, thereby reserved or agreed to be reserved or made payable, or by
reason of being made in consideration of the surrender or abandonment of
any existing lease of or agreement relating to the same subject matter.
(2) An agreement for a lease shall be chargeable with stamp duty as a
lease made for the term and consideration mentioned in the agreement.
17. Instrument increasing rent to be chargeable as a lease
An instrument whereby the rent reserved by any other instrument chargeable
with stamp duty and duly stamped as a lease is increased shall be
chargeable with stamp duty as if it were a lease but in respect only of
the additional rent thereby made payable, but this section shall not apply
to an instrument made solely for the purpose of giving notice of any such
increase in compliance with any Ordinance.
18. Calculation of stamp duty as regards foreign currency
(1) Where stamp duty falls to be calculated in respect of any instrument
by reference to a sum of money expressed in a currency other than Hong
Kong dollars, there shall, for the purpose of such calculation, be
substituted for that sum of money its equivalent expressed in Hong Kong
dollars at the rate of exchange prevailing on the date of the instrument.
(2) For the purposes of this section "rate of exchange", in relation to
any instrument referred to in subsection (1), means the buying rate for
the currency in question, as determined by the Monetary Authority, for
telegraphic transfers at the commencement of business on the date of the
instrument or, if that date is a Sunday or a general holiday, on the
business day immediately preceding that date. (Amended 82 of 1992 s. 10)
PART III ANCILLARY PROVISIONS RELATING TO PART II
19. Contract notes in respect of sale and purchase of Hong Kong stock
(1) Subject to this section, any person who effects any sale or purchase
of Hong Kong stock as principal or agent shall-(Amended 77 of 1981 s. 5)
(a) forthwith make and execute a contract note;
(b) cause the note to be stamped under head 2 (1) or (2) in the First
Schedule or, in the case of a note to which section 45 applies, under
section 13 (2)-(Amended 43 of 1991 s. 5)
(i) in the case of a sale or purchase effected in Hong Kong, not later
than 2 days thereafter;
(ii) in any other case, not later than 30 days thereafter;
(c) if he is the agent, transmit the stamped note to his principal;
(Amended 43 of 1991 s. 5)
(d) cause an endorsement to be made on the instrument of transfer of the
stock to the effect that -
(i) stamp duty has been paid on the contract note under head 2 (1) or (2)
in the First Schedule; or
(ii) in the case of a contract note to which section 45 applies, the
contract note has been stamped under section 13 (2). (Replaced 43 of 1991
s. 5)
(1A) Subsection (1) shall not apply to a sale or purchase of a unit under
a unit trust scheme-
(a) where the sale or purchase is effected by extinguishing such unit; or
(b) where the sale or purchase of the unit is effected by the managers
under the unit trust scheme and their power to effect such sale or
purchase arises-
(i) from the transfer to them of that or some other unit within the
immediately preceding 2 months; or
(ii) otherwise than from a previous transfer to them of that or some other
unit. (Added 77 of 1981 s. 5)
(1B) It shall not be obligatory for an endorsement to be made under
subsection (1) (d) where, at the time of the sale or purchase of Hong Kong
stock-
(a) the instrument of transfer of such stock is in the custody of a
recognized clearing house in accordance with the rules of the clearing
house; or
(b) the Hong Kong stock is registered in the name of a recognized clearing
house or its nominee. (Added 40 of 1992 s. 2)
(1C) Subsection (1) shall not apply to a sale or purchase of Hong Kong
stock effected under a market contract. (Added 68 of 1992 s. 20)
(2) A contract note required to be made under subsection (1) shall state
the following -
(a) whether the person effecting the sale or purchase of the Hong Kong
stock is acting as principal or agent and, if as agent, the name of his
principal;
(b) the date of the transaction and of the making of the contract note;
(c) the quantity and description of such Hong Kong stock;
(d) the price per unit of such Hong Kong stock and the amount of the
consideration or, in the case of an exchange, particulars of the property
for which such Hong Kong stock is exchanged; and
(e) the date of settlement.
(3) No agent or other person shall have any legal claim to any charge for
brokerage, commission or agency with reference to the sale or purchase of
any Hong Kong stock if he fails to comply with the provisions of this
section.
(4) The stamp duty paid in respect of a contract note may be added to any
charge for brokerage or agency and shall be recoverable as part of such
charge.
(5) Where a contract note relates to the sale or purchase of more than one
description of Hong Kong stock, the note shall be deemed to be as many
contract notes as there are descriptions of Hong Kong stock sold or
purchased.
(6) If in the case of a sale or purchase of any Hong Kong stock effected
by a person who is not resident in Hong Kong, the stamp duty specified in
head 2 (1) in the First Schedule is not paid, there shall be charged on
the instrument of transfer, in addition to the stamp duty otherwise
chargeable thereon, stamp duty equal to the amount of the stamp duty so
payable in respect of such sale or purchase; and in respect of stamp duty
charged on an instrument of transfer under this subsection, the transferee
shall be the person liable for stamping such instrument and the time for
stamping it shall be 30 days after execution thereof.
(7) Where any instrument of transfer is stamped under subsection (6), the
Collector shall endorse the instrument to that effect in such manner as he
may think fit.
(8) An instrument of transfer of any Hong Kong stock shall not be duly
stamped unless-
(a) it is endorsed under subsection (1) (d) or (7) in respect of both sale
and purchase; (Amended 40 of 1992 s. 2)
(b) it is endorsed by the Collector in such manner as he may think fit to
the effect that-
(i) Stamp duty has been paid in respect thereof under head 2 (3) in the
First Schedule; or
(ii) no stamp duty is chargeable thereon under subsection (6) or head 2
(1) or 2 (3) in the First Schedule; or (Amended 43 of 1991 s. 5; 40 of
1992 s. 2)
(c) the Hong Kong stock is transferred to a recognized clearing house, or
its nominee, in accordance with the rules of the clearing house. (Added 40
of 1992 s. 2)
(9) An endorsement under subsection (1) in respect of stamp duty paid-
(a) under head 2 (1) in the First Schedule may be made by the Collector or
any person authorized by the Collector in that behalf;
(b) under head 2 (2) in the First Schedule shall be made by the Collector,
in such manner as the Collector may think fit.
(9A) An endorsement under subsection (1) (d) (ii) shall be made by the
Collector in such manner as he thinks fit. (Added 43 of 1991 s. 5)
(10) Any person who makes an endorsement for the purposes of subsection
(1) (d) which is false in a material particular commits an offence.
(10A) In relation to a sale or purchase of a unit under a unit trust
scheme other than a sale or purchase referred to in subsection (1A), the
obligations imposed by this section (other than subsection (1) (c) and
head 2 (1) in the First Schedule on any person other than the managers
under the unit trust scheme shall be carried out by the managers in
addition to any obligation so imposed on them, and for that purpose
subsection (2) (a) shall not apply. (Added 77 of 1981 s. 5)
(11) Subject to subsections (12) and (13), nothing in this section shall
apply to -
(a) a stock borrowing; or
(b) a stock return. (Replaced 67 of 1989 s. 3)
(12) Where no stock return is made in respect of a stock borrowing, such
stock borrowing shall for the purposes of this Ordinance be deemed to be a
sale and a purchase of the borrowed stock and this Ordinance (except
subsection (1) (d) of this section) shall apply to such sale and purchase
as if they were effected in Hong Kong-
(a) by the approved borrower who obtained the borrowed stock;
(b) on the specified day; and
(c) for a consideration calculated at the previous closing price of Hong
Kong stock of the same description as the borrowed stock or, if there is
more than one description of the borrowed stock, at their respective
previous closing prices as quoted on the Unified Exchange. (Added 67 of
1989 s. 3)
(13) An approved borrower who has effected any stock borrowings shall-
(a) keep a book in such form;
(b) enter in such book, in respect of such stock borrowings and any stock
returns made in respect of such stock borrowings, such particulars; and
(c) furnish to the Collector a return-
(i) in such form;
(ii) containing such particulars in respect of such book; and
(iii) at such times, as the Collector may require. (Added 67 of 1989 s. 3)
(14) Where the Collector is satisfied that a person in the ordinary course
of his business obtains Hong Kong stock for the sole purpose of settling a
sale of Hong Kong stock effected by a broker in accordance with the rules
and practices of the Unified Exchange, the Collector may approve in
writing such person as an approved borrower for the purposes of this
section. (Added 67 of 1989 s. 3)
(15) Any approved borrower who fails to comply with the requirements of
subsection (13) shall incur a penalty of $1,000 which shall be recoverable
by the Collector as a civil debt due to the Crown. (Added 67 of 1989 s. 3)
(16) In this section -
"allotment", in relation to units under a unit trust scheme, means the
issue of such units;
"approved borrower" means-
(a) a broker; or
(b) a person approved under subsection (14) as an approved borrower for
the purposes of this section;
"borrowed stock", in relation to a stock borrowing, means the Hong Kong
stock obtained by an approved borrower under such stock borrowing;
"market contract" means a market contract within the meaning of section 2
of the Securities (Clearing Houses) Ordinance (Cap. 420); (Added 68 of
1992 s. 20) "previous closing price", in relation to Hong Kong stock,
means the previous closing price of such Hong Kong stock as determined in
accordance with the rules and practices of the Unified Exchange;
"recognized clearing house" means a recognized clearing house within the
meaning of section 2 of the Securities (Clearing Houses) Ordinance (Cap.
420); (Replaced 68 of 1992 s. 20)
"rules" in relation to -
(a) a recognized clearing house, means such of the rules, within the
meaning of section 2 of the Securities (Clearing Houses) Ordinance (Cap.
420), of the clearing house which have effect by virtue of the provisions
of that Ordinance; (Replaced 68 of 1992 s. 20)
(b) the Unified Exchange, means the rules governing the operation and
management of the Unified Exchange or the conduct of its members, by
whatever name they may be called and wherever contained; (Replaced 40 of
1992 s. 2)
"sale or purchase" includes any disposal or acquisition (other than an
allotment) for valuable consideration, and exchange, and any transaction
in respect of which an instrument is deemed by virtue of section 30 (3),
(4) or (5) to be a transfer by way of sale, and any reference to "sale" or
"purchase" shall be construed accordingly; "specified day", in relation to
a stock borrowing, means-
(a) the fifteenth day after the day on which the borrowed stock was
obtained by an approved borrower under such stock borrowing; or
(b) where, in respect of such stock borrowing, the Collector has allowed a
longer period than the period specified in paragraph (b) of the definition
of "stock borrowing" for the undertaking referred to in that paragraph to
be carried out, the day immediately following the expiration of such
longer period;
"stock borrowing" means a transaction in which an approved borrower-
(a) for the sole purpose of settling a sale of Hong Kong stock effected by
a broker in accordance with the rules and practices of the Unified
Exchange in the ordinary course of his business as a broker, obtains from
a person Hong Kong stock of the description required for that purpose; and
(b) gives an undertaking to provide-
(i) to the person referred to in paragraph (a); and
(ii) no later than 14 days after the day on which he obtained from that
person the Hong Kong stock referred to in paragraph (a), Hong Kong stock
of the same quantity and description as was so obtained from that person;
"stock return", in relation to a stock borrowing, means a transaction in
which, in respect of such stock borrowing, the undertaking referred to in
paragraph (b) of the definition of "stock borrowing" is carried out
within-
(a) the period specified in that paragraph; or
(b) such longer period as the Collector may allow. (Added 67 of 1989 s. 3)
19A. Refund of stamp duty in respect of sale and purchase of units under
unit trust schemes
(1) Where stamp duty is paid under head 2 (1) in the First Schedule in
respect of a sale or purchase of a unit under a unit trust scheme effected
by the managers under such scheme, the stamp duty shall be refunded to the
managers upon application to the Collector under subsection (2) if the
managers and trustees under such scheme, before the expiration of 2 months
from the date on which the sale or purchase is effected, jointly certify
that-
(a) the certificate, if any, in respect of the unit has been canceled;
(b) as a consequence of the sale or purchase, a proportionate part of the
trust property has been realized, and the trust property diminished
accordingly; and
(c) the unit is extinguished and the managers have no power to transfer
any other unit in lieu thereof.
(2) On an application for a refund of stamp duty under this section, the
applicant shall produce to the Collector the contract notes in respect of
which the stamp duty was paid and the joint certificate of the managers
and trustees referred to in subsection (1).
(3) In this section "trust property" has the meaning assigned to it by
section 30. (Added 77 of 1981 s. 6)
20. Stamp duty payable where transaction in respect of Hong Kong stock
does not amount to jobbing business
Where a contract note is stamped under head 2 (2) in the First Schedule
but the whole or any part of the transaction to which it relates is shown
thereafter not to amount to jobbing business, there shall be payable by
the broker effecting the sale or purchase to which the contract note
relates by way of stamp duty on demand in respect of a note to be issued
by the Collector-
(a) an amount equal to the stamp duty which would have been payable if the
contract note had been stamped under head 2 (1) in the First Schedule; and
(b) an amount equal to interest on the amount referred to in paragraph (a)
at the rate of 3 cents per $100 per day in respect of the period from the
date of the purchase or sale to the date of payment of that amount:
Provided that where the amount referred to in paragraph (a) includes a
fraction of $100 such fraction shall, for the purposes of determining the
amount referred to in paragraph (b), be reckoned as $100.
21. Passing on of dividends or interest on Hong Kong stock prohibited
(1) No person shall be entitled to claim, directly or indirectly, the
payment of any dividend or interest or of the amount or value of any
dividend or interest on any Hong Kong stock unless-
(a) such person is the registered owner of the Hong Kong stock at the time
of such claim;
(b) such person was the registered owner of the Hong Kong stock at some
time subsequent to the date on which the dividend was declared or the
interest became due;
(c) such person is entitled to be paid such dividend or interest under a
declaration of trust in favour of a specified person or otherwise as a
beneficiary under a trust; or
(d) such person has lent money on the security of the Hong Kong stock and
is entitled by the terms of the loan to claim such dividend or interest.
(2) No person shall demand or request or accept, directly or indirectly,
payment of any dividend or of the amount or value of any dividend or
interest which under subsection (1) he is not entitled to claim.
(3) No person shall, directly or indirectly, pay any dividend or interest
or the amount or value of any dividend or interest on any Hong Kong stock
to any other person unless-
(a) such other person is the registered owner of the Hong Kong stock;
(b) such other person was the registered owner of the Hong Kong stock at
some time subsequent to the date on which the dividend was declared or the
interest became due;
(c) such other person is entitled to be paid such dividend or interest
under a declaration of trust in favour of a specified person or otherwise
as a beneficiary under a trust; or
(d) such other person has lent money on the security of the Hong Kong
stock and is entitled by the terms of the loan to claim such dividend or
interest.
22. Stamp duty chargeable where consideration in respect of immovable
property consists of stock or security other than stock
(1) Where the consideration or any part of the consideration for a
conveyance on sale consists of any stock, the conveyance shall be
chargeable with stamp duty by reference to the value of the stock on the
date of the conveyance.
(2) Where the consideration or any part of the consideration for a
conveyance on sale consists of any security not being stock, the
conveyance shall be chargeable with stamp duty by reference to the amount
due on the date of the conveyance for principal and interest upon the
security.
23. How consideration consisting of periodical payments to be charged
(1) In the case of a conveyance on sale or a sale or purchase of Hong Kong
stock, where the consideration or any part of the consideration consists
of money payable periodically for a definite period not exceeding 20 years
so that the total amount to be paid can be previously ascertained, the
conveyance or contract note shall be chargeable with stamp duty by
reference to a consideration of such total amount.
(2) In the case of a conveyance on sale or a sale or purchase of Hong Kong
stock, where the consideration or any part of the consideration consists
of money payable for a definite period exceeding 20 years or in perpetuity
or for any indefinite period not terminable with life, the conveyance or
contract note shall be chargeable with stamp duty by reference to a
consideration of an amount equal to the total amount which will or may,
according to the terms of sale, be payable during the period of 20 years
after the date of the conveyance or contract note.
(3) In the case of a conveyance on sale or a sale or purchase of Hong Kong
stock, where the consideration or any part of the consideration consists
of money payable periodically for a life or lives, the conveyance or
contract note shall be chargeable with stamp duty by reference to a
consideration equal to the amount which will or may, according to the
terms of sale, be payable during the period of 12 years after the date of
the conveyance or contract note.
24. Stamp duty chargeable where conveyance etc. is in consideration of
debt etc.
(1) In the case of a conveyance on sale or any transaction whereby a
beneficial interest in Hong Kong stock passes, where the conveyance or
transaction is in consideration, wholly or in part, of any debt due to the
transferee or is subject either certainly or contingently to the payment
or transfer of any money or stock, whether or not being or constituting a
charge or incumbrance upon the property or interest so conveyed or passing
the debt, money or stock is to be deemed the whole or part, as the case
may be, of the consideration by reference to which the conveyance or
contract note is chargeable with stamp duty.
(2) Where a conveyance on sale or transaction whereby a beneficial
interest in any Hong Kong stock passes is in consideration wholly or in
part of any debt due to the transferee and, apart from this subsection,
the consideration by reference to which the conveyance or contract note
would be chargeable with stamp duty would exceed the value of the property
conveyed or beneficial interest passing, that consideration shall be
treated as reduced to that value; and the conveyance or contract note
shall not be duly stamped unless it is stamped under section 13 (3).
(3) Where, by virtue of or in connexion with any transaction referred to
in subsection (1) whereby a beneficial interest in any shares in a body
corporate passes, any liability is incurred by the transferee in respect
of any indebtedness of the body corporate, the transaction shall, in
addition to any other payment of money or transfer of shares to which it
is subject, be deemed to be subject to the payment of an amount of money
equal to the amount of such indebtedness.
25. Stamp duty chargeable in case of certain conveyances
(1) Where immovable property contracted to be sold for one consideration
for the whole is conveyed to the purchaser in separate parts or parcels by
different instruments, the consideration shall be apportioned in such
manner as the parties think fit, so that a distinct consideration for each
separate part or parcel is set forth in the conveyance relating thereto,
and such conveyance shall be chargeable with stamp duty by reference to
such distinct consideration.
(2) Where immovable property contracted to be purchased for one
consideration for the whole by 2 or more persons jointly, or by any person
for himself and others or wholly for others, is conveyed in parts or
parcels by separate instruments to the persons by or for whom the same was
purchased for distinct parts of the consideration, the conveyance of each
separate part or parcel shall be chargeable with stamp duty by reference
to the distinct part of the consideration therein specified.
(3) Where there are several instruments of conveyance for completing the
purchaser's title to immovable property sold, the principal instrument of
conveyance only shall be chargeable with stamp duty and the other
instruments shall not be chargeable with stamp duty.
(4) Where a person having contracted for the purchase of any immovable
property but not having obtained a conveyance thereof contracts to sell
the same to any other person and the property is in consequence conveyed
immediately to the sub-purchaser, the conveyance shall be chargeable with
stamp duty by reference to the consideration moving from the sub-
purchaser.
(5) Where a person having contracted for the purchase of any immovable
property but not having obtained a conveyance contracts to sell the whole
or any part or parts thereof to any other person or persons and the
property is in consequence conveyed by the original seller to different
persons in parts or parcels, the conveyance of each part or parcel shall
be chargeable with stamp duty by reference only to the consideration
moving from the sub-purchaser thereof, without regard to the amount or
value of the original consideration.
(6) Where a sub-purchaser takes an actual conveyance of the interest of
the person immediately selling to him, which is chargeable with stamp duty
by reference to the consideration moving from him and is duly stamped
accordingly, any conveyance to be afterwards made to him of the same
immovable property by the original seller shall not be chargeable with
stamp duty.
(7) Where upon the exchange of any immovable property for any other
immovable property, or upon the partition of any immovable property, any
consideration is paid or given, or agreed to be paid or given, for
equality, the principal or only instrument whereby the exchange or
partition is effected shall, subject to section 27, be charged with the
same stamp duty as a conveyance on sale for the consideration, and with
that stamp duty only; and where in any such case there are several
instruments for completing the title of either party, the instruments
other than the principal instrument shall not be chargeable with any stamp
duty.
26. Stamp duty chargeable on contracts etc. for sale of equitable estate
or interest in immovable property
(1) Any contract or agreement for the sale of any equitable estate or
interest in any immovable property shall be chargeable with stamp duty as
if it were an actual conveyance on sale of the estate or interest.
(2) Where stamp duty has been paid under subsection (1) and the purchaser,
before having obtained a conveyance of the property, enters into a
contract or agreement for the sale thereof, the contract or agreement
shall be charged, if the consideration for that sale is in excess of the
consideration for the original sale, with the stamp duty chargeable by
reference to such excess consideration, but shall not otherwise be
chargeable.
(3) Where stamp duty has been duly paid under subsection (1)
or (2), the conveyance made to the purchaser or sub-purchaser, or any
other person on his behalf or by his direction, shall not be chargeable
with any stamp duty, and the Collector shall, upon application and
production of the contract or agreement, or contracts or agreements, duly
stamped, denote upon the conveyance the payment of the stamp duty.
(4) Where a conveyance made in conformity with a contract or agreement
referred to in subsection (1) or (2) which has not been stamped is
presented to the Collector for stamping within 6 months after the
execution of the contract or agreement or such longer period as the
Collector may think reasonable in the circumstances of the case, the
conveyance shall be stamped accordingly, and the contract or agreement
shall thereupon cease to be chargeable with any stamp duty.
(5) Where any contract or agreement referred to in subsection (1) or (2)
is rescinded or annulled, any stamp duty paid in respect thereof shall be
returned by the Collector.
27. Voluntary dispositions
(1) Any conveyance of immovable property operating as a voluntary
disposition inter vivos shall be chargeable with stamp duty as a
conveyance on sale, with the substitution of the value of the property
conveyed for the amount or value of the consideration for the sale.
(2) In the case of an instrument of transfer operating as a voluntary
disposition inter vivos of Hong Kong stock, or an instrument referred to
in section 28 (1) which so operates by virtue of that section, any stamp
duty paid in respect of contract notes made under section 19 (1) in
respect of the amount or value of any consideration given by the
transferee for such Hong Kong stock shall be set off against the stamp
duty chargeable on such instrument of transfer.
(3) A conveyance or transfer operating as a voluntary disposition inter
vivos shall not be duly stamped unless the Collector has stamped the
instrument of conveyance or transfer under section 13 (3) (b).
(4) Any conveyance or transfer (not being a disposition made in favour of
a purchaser or incumbrancer or other person in good faith and for valuable
consideration) shall for the purposes of this Ordinance be deemed to be a
conveyance or transfer operating as a voluntary disposition inter vivos,
and (except where marriage is the consideration) the consideration for any
conveyance or transfer shall not for this purpose be deemed to be valuable
consideration where the Collector is of opinion that by reason of the
inadequacy of the sum paid as consideration or other circumstances the
conveyance or transfer confers a substantial benefit on the person to whom
the property is conveyed or transferred.
(5) Nothing in this section shall apply to a conveyance or transfer made
for nominal consideration for the purpose of securing the repayment of an
advance or loan or made for effectuating the appointment of a new trustee,
whether the trust is expressed or implied, or under which no beneficial
interest passes in the property conveyed or transferred, or made to a
beneficiary by a trustee or other person in a fiduciary capacity under any
trust, whether expressed or implied, and this subsection shall have effect
notwithstanding that the circumstances exempting the conveyance or
transfer from charge under this section are not set forth in the
conveyance or transfer.
(6) In this section "conveyance" includes any agreement for a lease or any
release or renunciation of immovable property.
28. Stamp duty chargeable in case of conveyance or transfer in
contemplation of sale or subject to power of revocation etc.
(1) Subject to this section, any instrument whereby property is conveyed
or transferred to any person in contemplation of a sale of that property
shall be treated as a conveyance or transfer operating as a voluntary
disposition inter vivos of that property.
(2) If on a claim made to the Collector not later than 2 years after the
making or execution of an instrument to which subsection (1) applies, it
is shown to his satisfaction-
(a) that the sale in contemplation of which the instrument was made or
executed has not taken place and the property has been re-conveyed or
retransferred to the person from whom it was conveyed or transferred or to
a person to whom his rights have been transmitted on death or bankruptcy;
or
(b) that the sale has taken place for a consideration which is less than
the value by reference to which stamp duty was paid in respect of the
instrument by virtue of this section,
the Collector shall repay the stamp duty paid by virtue of this section,
in a case falling under paragraph (a), so far as it exceeds the stamp duty
which would have been payable apart from this section and, in a case
falling under paragraph (b), so far as it exceeds the stamp duty which
would have been payable if the instrument had been stamped in accordance
with subsection (1) in respect of a value equal to the consideration in
question:
Provided that, in a case falling under the said paragraph (b), stamp duty
shall not be repayable if it appears to the Collector that the
circumstances are such that a conveyance or transfer on the sale in
question would have been chargeable with stamp duty by virtue of section
27 (4).
(3) Subsections (1) and (2) shall apply whether or not an instrument
conveys or transfers other property in addition to the property in
contemplation of the sale of which it is made or executed, but those
subsections shall not affect the stamp duty chargeable in respect of that
other property.
(4) For the purposes of section 27 and this section, the value of property
conveyed or transferred by an instrument chargeable with stamp duty in
accordance with either of those provisions shall be determined without
regard to -
(a) any power (whether or not contained in the instrument) on the exercise
of which the property, or any part of or any interest in the property, may
be re-vested in the person from whom it was conveyed or transferred or in
any person on his behalf;
(b) any annuity reserved out of the property or any part of it, or any
life or other interest so reserved, being an interest which is subject to
forfeiture,
but if on a claim made to the Collector not later than 2 years after the
making or execution of the instrument it is shown to his satisfaction that
any such power as is mentioned in paragraph (a) has been exercised in
relation to the property and the property or any property representing it
has been re-conveyed or re-transferred in whole or in part in consequence
of that exercise the Collector shall repay the stamp duty paid by virtue
of this subsection, in a case where the whole of such property has been so
re-conveyed or re- transferred, so far as it exceeds the stamp duty which
would have been payable apart from this subsection and, in any other case,
so far as it exceeds the stamp duty which would have been payable if the
instrument had operated to convey or transfer only such property as is not
so re-conveyed or re-transferred.
29. Certificate with respect to certain conveyances on sale
(1) References in head 1 (1) in the First Schedule to a conveyance on sale
being certified at a particular amount mean that such conveyance on sale
contains a statement certifying that the transaction effected by the
instrument does not form part of a larger transaction or series of
transactions in respect of which the amount or value, or aggregate amount
or value, of the consideration exceeds that amount.
(2) In subsection (1) a reference to the amount or value of the
consideration shall be construed-
(a) in relation to stamp duty chargeable on a conveyance operating as a
voluntary disposition inter vivos, as a reference to the value of the
property conveyed;
(b) in relation to stamp duty chargeable on a lease or agreement for a
lease, as a reference to the amount or value of the consideration in
money, stock or security, other than rent.
PART IIIA AGREEMENTS TO SELL IMMOVABLE PROPERTY
29A. Interpretation and application of Part III A
(1) In this Part and the First Schedule-
"agreement for sale" means-
(a) an instrument in which a person contracts to sell or purchase
immovable property;
(b) an instrument in which a person confers, or has conferred on him, an
option or a right to purchase immovable property or a right of pre-emption
in respect of immovable property, other than a specified option or right;
(c) an instrument, other than a mortgage or charge made in favour of a
financial institution within the meaning of section 2 of the Inland
Revenue Ordinance (Cap. 112), in which a person-
(i) gives or is given a power of attorney expressed to be irrevocable and
given to secure a proprietary interest of the donee of the power or the
performance of an obligation owed to the donee, and giving the donee
authority on behalf of the donor to sell or otherwise dispose of any
interest of the donor in immovable property; or
(ii) grants or is granted an authority on behalf of the grantor to sell or
otherwise dispose of any interest of the grantor in immovable property,
and under which consideration for that authority moves from the grantee of
the authority to the grantor;
(d) an instrument in which a declaration of trust in respect of immovable
property is made, other than a declaration of trust under which no
beneficial interest passes in the property subject to the declaration;
(e) an instrument which, if implemented, would be implemented by a
conveyance on sale;
(f) an instrument which constitutes a memorandum, note, or other evidence
of an unwritten sale agreement;
(g) an instrument in which a purchaser under an instrument referred to in
this definition assigns any rights under the second-mentioned instrument
in respect of immovable property;
(h) an instrument in which a purchaser under an instrument referred to in
this definition makes a nomination or gives a direction that-
(i) transfers, or gives a power to transfer, any benefit, in respect of
immovable property, of the purchaser under the second-mentioned
instrument; or
(ii) authorizes another person to take a conveyance of immovable property
that is subject to the second-mentioned instrument or to execute such a
conveyance in favour of a third party,
other than a nomination made, or a direction given, in favour of a person
who is to be a trustee for the purchaser in respect of the property, or in
favour of one, or more than one, person who is a parent, spouse or child
of the purchaser (whether or not also in favour of the purchaser);
"chargeable agreement for sale" means an agreement for sale chargeable
with stamp duty under head 1 (1A) in the First Schedule;
"non-residential property" means immovable property which, under the
existing conditions of -
(a) a Crown lease or an agreement for a Crown lease;
(b) a deed of mutual covenant, within the meaning of section 2 of the
Multi-storey Buildings (Owners Incorporation) Ordinance (Cap. 344);
(c) an occupation permit issued under section 21 of the Buildings
Ordinance (Cap. 123); or
(d) any other instrument which the Collector is satisfied effectively
restricts the permitted user of the property,
may not be used, at any time during the term of the Crown lease in respect
of the property or during the term of the Crown lease that has been agreed
for in respect of the property (as is appropriate), wholly or partly for
residential purposes;
"purchaser" includes any person who, under an agreement for sale or an
unwritten sale agreement, -
(a) contracts to purchase immovable property;
(b) acquires-
(i) immovable property;
(ii) an option or a right to purchase immovable property or a right of
pre-emption in respect of immovable property, other than a specified
option or right;
(iii) a power or authority to sell or otherwise dispose of any interest in
immovable property;
(iv) any right or benefit in respect of immovable property of a purchaser
under an agreement for sale or an unwritten sale agreement;
(v) a power to transfer any such right or benefit;
(vi) an authority to take a conveyance of immovable property that is
subject to an agreement for sale or an unwritten sale agreement; or
(c) is named as a person in whose favour another person is authorized to
execute a conveyance of immovable property;
"residential property" means immovable property other than non-residential
property; "specified option or right" means an option or right to
purchase, or aright of pre-emption, conferred-
(a) by a lessor on a lessee;
(b) in a lease, or an agreement for a lease, for a fixed term of not less
than 3 years; and
(c) in respect of the property subject to the lease,
and which is not exercisable within 3 years of the commencement of the
lease or agreement for a lease, otherwise than by giving notice to
exercise the option or right which notice does not expire within those 3
years;
"unwritten sale agreement" means a contract, agreement, or statement not
in the form of an instrument but of such a nature that, if it were in such
a form, the instrument would constitute an agreement for sale;
"vendor" includes any person who, under an agreement for sale or an
unwritten sale agreement-
(a) contracts to sell immovable property;
(b) grants, confers, or transfers-
(i) immovable property;
(ii) an option or a right to purchase immovable property or a right of
pre-emption in respect of immovable property, other than a specified
option or right;
(iii) a power or authority to sell or otherwise dispose of any interest in
immovable property;
(iv) any right or benefit in respect of immovable property that he has as
a purchaser under an agreement for sale or an unwritten sale agreement;
(v) a power to transfer any such right or benefit;
(vi) an authority to take a conveyance of immovable property that is
subject to an agreement for sale or an unwritten sale agreement; or
(c) authorizes another person to execute in favour of a third party a
conveyance of immovable property that is subject to an agreement for sale
or an unwritten sale agreement.
(2) An agreement for sale and an unwritten sale agreement may be
enforceable or unenforceable, absolute or conditional, formal or informal,
temporary or permanent, provisional or non-provisional.
(3) An agreement for sale may consist of 2 or more instruments.
(4) For the purposes of this Part and head 1 (1A) in the First Schedule,
an agreement for sale, an unwritten sale agreement and a conveyance on
sale are made on the same terms as a previous agreement if, but only if,
the agreement for sale, the unwritten sale agreement or the conveyance on
sale (as the case may be) and the previous agreement-
(a) are made in respect of the same immovable property; and
(b) specify the same consideration for the conveyance on sale.
(5) Head 1 (1A) in the First Schedule does not apply to an agreement for
sale in respect of non-residential property.
(6) This Part and head 1 (1A) in the First Schedule apply notwithstanding
any provision in any other Part of this Ordinance.
(7) This Part and head 1 (1A) in the First Schedule do not apply to an
agreement for sale or an unwritten sale agreement -
(a) made before; or
(b) that supersedes an agreement for sale or an unwritten sale agreement
made between the same parties and on the same terms before,
the commencement of the Stamp Duty (Amendment) Ordinance 1992 (8 of 1992).
29B. Duty to execute agreement for sale
(1) Each purchaser and vendor under an unwritten sale agreement or an
agreement for sale shall, not later than 30 days after the relevant date,
if he has not already done so, execute an agreement for sale containing
the matters specified in subsection (5).
(2) Subsection (1) does not apply to a purchaser who, on the relevant
date, does not know that the unwritten sale agreement or agreement for
sale affects him.
(3) For the purposes of subsections (1) and (2), the relevant date means-
(a) in the case of an unwritten sale agreement, the date on which that
agreement was made;
(b) in the case of an agreement for sale not preceded by an unwritten sale
agreement, or an agreement for sale, made between the same parties and on
the same terms, the date on which that agreement was made; and
(c) in the case of an agreement for sale preceded by one or more than one
unwritten sale agreement, or agreement for sale, made between the same
parties and on the same terms, the date on which the first of such
agreements was made.
(4) If a person enters into an agreement for sale or an unwritten sale
agreement as agent for a vendor or purchaser, the agent and the vendor or
purchaser (as the case may be) are jointly and severally liable to comply
with subsection (1).
(5) The following matters are specified for the purposes of subsection (1)
-
(a) the name and address of the vendor and of the purchaser of the
immovable property;
(b) if the vendor or purchaser is an individual, his identification
number;
(c) if the vendor or purchaser is not an individual but is registered
under the Business Registration Ordinance (Cap. 310), the business
registration number of the vendor or purchaser;
(d) the description and location of the immovable property;
(e) a statement as to whether the immovable property is residential
property or non-residential property, within the meanings of section 29A
(1);
(f) the date on which the agreement for sale was made;
(g) if the agreement for sale was preceded by an unwritten sale agreement,
or an agreement for sale, made between the same parties and on the same
terms, the date on which the first such agreement was made;
(h) a statement as to whether or not a date has been agreed for a
conveyance on sale pursuant to the agreement for sale and, if so, that
date;
(i) a statement as to whether or not there is an agreed consideration for
the conveyance on sale that is to, or may, take place pursuant to the
agreement for sale and, if so, the amount or value of the consideration;
(j) the amount or value of any other consideration which each person
executing the document knows has been paid or given, or has been agreed to
be paid or given, to any person for or in connection with the agreement
for sale or any conveyance on sale pursuant to that agreement (excluding
legal expenses), together with the name, address, and the identification
number or business registration number of each person receiving or to
receive such consideration, and a description of the benefit to which the
consideration relates;
(k) if the purchaser has not executed the agreement, a statement as to
whether or not, to the best of the knowledge of each person executing the
agreement, the purchaser knew, at the time the agreement was made, that it
affected him.
(6) Any person required to execute an agreement for sale in accordance
with subsection (1) who fails to do so is liable civilly to the Collector
for the payment of any stamp duty chargeable on that agreement, which
shall be deemed for the purposes of this subsection to be a chargeable
agreement for sale, and any penalty payable under section 9; and if 2 or
more persons fail to execute such an agreement each person is jointly and
severally so liable.
(7) Any person liable, under subsection (6), to pay stamp duty chargeable
on an agreement for sale may set off the amount (if any) of that stamp
duty paid by him against any stamp duty payable by him in respect of a
conveyance on sale made in pursuance of that agreement, within the meaning
of section 29D (6) (d).
(8) No action shall be brought by virtue of subsection (6) for the
recovery of any stamp duty with respect to any instrument more than 6
years from the expiration of the time for stamping that instrument.
(9) Any person who with intent to defraud the Government fails to comply
with subsection (1) commits an offence, but the Collector may, before the
commencement of criminal proceedings, compound any such offence.
(10) A failure by any person to comply with subsection (1) does not affect
the validity or enforceability of an agreement for sale or unwritten sale
agreement.
(11) In this section, "identification number" in relation to a person
means-
(a) the number of any identity card issued to him under the Registration
of Persons Ordinance (Cap. 177);
(b) if no such card has been issued to him, the number of any travel
document, certificate of identity, or document of identity (within the
meanings of section 2 (1) of the Immigration Ordinance (Cap. 115) issued
to him;
(c) if no such document or certificate has been issued to him, the number
of any other document that establishes his identity to the satisfaction of
the Collector,
but no such number is complete unless the relevant document is described.
29C. Chargeable agreements for sale
(1) An agreement for sale to which head 1 (1A) in the First Schedule
applies is chargeable with stamp duty even if the agreement is cancelled,
annulled, or rescinded or is for any other reason not performed.
(2) An agreement for sale to which head 1 (1A) in the First Schedule
applies is chargeable with stamp duty even if -
(a) it does not contain the matters specified in section 29B (5); or
(b) it has not been executed by all persons who are required by section
29B (1) to execute it,
or both, but the Collector may refuse to stamp a chargeable agreement for
sale that does not contain those matters or has not been so executed.
(3) For the avoidance of doubt, it is hereby declared that if -
(a) a chargeable agreement for sale is made in respect of immovable
property; and
(b) another chargeable agreement for sale is made in respect of all or any
part of the property (whether by the vendor or purchaser under the
first-mentioned agreement, or both) before a conveyance on sale of the
property or that part of the property is made in pursuance of the
first-mentioned agreement,
then (subject to the notes to head 1 (1A) in the First Schedule and to
section 29F) each agreement is chargeable with stamp duty by reference to
the consideration for the agreement.
(4) The principle in subsection (3) applies, with necessary modifications,
if there is a series of more than 2 chargeable agreements for sale in
respect of the same, or any part of the same, immovable property; for
example -
(a) if a purchaser under a chargeable agreement for sale makes a
chargeable agreement for a subsale, and the sub-purchaser makes a further
chargeable agreement for a sub-sale; or
(b) if a chargeable agreement for sale is cancelled and replaced by a
chargeable agreement for sale made by the vendor and a second purchaser,
and that other agreement is cancelled and replaced by a chargeable
agreement for sale made by the vendor and a third purchaser,
then (subject to the notes to head 1 (1A) in the First Schedule and to
section 29F) each agreement is chargeable with stamp duty by reference to
the consideration for the agreement.
(5) If -
(a) a chargeable agreement for sale is made in respect of immovable
property; and
(b) another chargeable agreement for sale is made in respect of all or any
part of the property (whether by the vendor or purchaser under the
first-mentioned agreement, or both) before a conveyance on sale of the
property or that part of the property is made in pursuance of the
first-mentioned agreement; and
(c) under the second-mentioned agreement -
(i) the purchasers are a person named in the first-mentioned agreement as
a purchaser and another person who is not so named; or
(ii) the purchaser is one, or the purchasers are some, (but not all) of
the persons named in the first-mentioned agreement as the purchasers, the
second-mentioned agreement shall be chargeable with stamp duty as if it
were a conveyance on sale executed in pursuance of the first-mentioned
agreement for sale and section 29D (4) or (5) (as is appropriate) shall
apply accordingly.
(6) If stamp duty has been paid in respect of a chargeable agreement for
sale under which the vendor was unable to prove his title in accordance
with the agreement and which was rescinded by the purchaser on that ground
-
(a) the Collector shall, subject to the production of such evidence, by
statutory declaration or otherwise, as the Collector may require, make
allowance for the stamp duty paid;
(b) section 51 applies to such an allowance as if it were an allowance for
spoiled stamps made under Part VI; but
(c) this subsection shall only apply if -
(i) the application for allowance is made within 2 years after the
agreement was rescinded; and
(ii) no legal proceeding (other than legal proceedings in which there
falls to be determined the question whether the purchaser was so entitled
to rescind the agreement) has been commenced in which the instrument could
or would have been given or offered in evidence and, if the Collector so
requires, the instrument is given up to be cancelled.
(7) Where a chargeable agreement for sale consists of 2 or more
instruments, the principal instrument only shall be chargeable with stamp
duty and the other instruments shall not be chargeable with stamp duty.
(8) For the purposes of this Ordinance, the consideration for an agreement
for sale shall be deemed to be the aggregate of the amounts and values
referred to in section 29B (5) (i) and (j).
(9) For the purpose of ascertaining the manner in which a chargeable
agreement for sale is chargeable with stamp duty, sections 22, 23 and 24
shall operate as if any reference in those sections-
(a) to a conveyance on sale were a reference to a chargeable agreement for
sale;
(b) to a transferee were a reference to the purchaser under a chargeable
agreement for sale;
(c) to the property conveyed were a reference to the immovable property
subject to a chargeable agreement for sale.
(10) Where under a chargeable agreement for sale -
(a) the exchange of any immovable property for any other immovable
property; or
(b) the partition of an immovable property, is agreed to, and any
consideration is paid or given, or agreed to be paid or given, for
equality, the agreement for sale shall, subject to section 29F, be charged
with the same stamp duty as a chargeable agreement for sale for the
consideration, and with that stamp duty only.
29D. Conveyances on sale of residential property
(1) If a conveyance on sale of residential property is presented for
stamping and the Collector has reason to believe -
(a) that a chargeable agreement for sale or an unwritten sale agreement
that would, if it were in the form of an instrument, be a chargeable
agreement for sale has been made in respect of all or any part of that
property after it was vested in the vendor; and
(b) that, in respect of that agreement, section 29B (1) has not been
complied with, or the agreement for sale has not been duly stamped or
stamped under section 5
(1) or 13 (2),
the Collector may refuse to stamp the conveyance on sale.
(2) Subject to subsection (3), where a conveyance on sale of residential
property is executed in conformity with a chargeable agreement for sale
and -
(a) the agreement for sale is duly stamped or stamped under section 5 (1)
or 13 (2) (whether before or after the execution of the conveyance on
sale), the conveyance on sale is chargeable with stamp duty of $100;
(b) the agreement for sale is not so stamped -
(i) the conveyance on sale is chargeable with stamp duty under head 1 (1)
in the First Schedule;
(ii) for the purpose of calculating the time for stamping the conveyance
on sale, the conveyance shall be deemed to have been executed on the date
that the agreement for sale was made or, if the agreement for sale was
preceded by an agreement for sale, or an unwritten sale agreement, made
between the same parties and on the same terms, the date when the first
such agreement was made; and
(iii) the agreement for sale is chargeable with stamp duty of $100.
(3) Where a conveyance on sale of residential property is executed in
conformity with 2 or more agreements for sale, each relating to different
parts of the residential property, and one or more of those agreements is
a chargeable agreement for sale, then -
(a) if each of the chargeable agreements for sale is duly stamped or
stamped under section 5 (1) or 13 (2) (whether before of after the
execution of the conveyance on sale), the conveyance on sale is chargeable
with stamp duty under head 1 (1) in the First Schedule, less the total
amount of stamp duty (excluding any penalty) paid or assessed to be
payable in respect of those agreements for sale;
(b) if any of the chargeable agreements for sale is not duly stamped or
stamped under section 5 (1) or 13 (2), the conveyance on sale shall not be
stamped except by the Collector upon payment of the stamp duty payable in
respect of the conveyance under head 1 (1) in the First Schedule, and any
penalty payable in respect of that agreement for sale under section 9,
less the total amount of stamp duty paid or assessed to be payable in
respect of any of the other chargeable agreements for sale;
(c) if the conveyance on sale is duly stamped or stamped under section 5
(1) or 13 (2) before each of the chargeable agreements for sale is duly
stamped, any unstamped chargeable agreement for sale is chargeable with
stamp duty of $100, any chargeable agreement for sale that has been
assessed remains chargeable with the amount of the stamp duty assessed,
and any chargeable agreement for sale that has been stamped under section
13 (2) but not assessed ceases to be chargeable with any further stamp
duty.
(4) Where a conveyance on sale of residential property is executed in
pursuance of a chargeable agreement for sale and is in favour of a person
named in the agreement as the purchaser and another person who is not so
named, then -
(a) if the agreement for sale is duly stamped or stamped under section 5
(1) or 13 (2) (whether before or after the execution of the conveyance on
sale), the conveyance on sale is chargeable with stamp duty under head 1
(1) in the First Schedule by reference to the consideration for the
conveyance, less a fraction of the stamp duty representing the proportion
of the residential property that is vested in the person named in the
agreement as the purchaser; and for the purposes of this subsection, joint
tenants shall be treated as having equal undivided shares in the property;
(b) if the agreement for sale is not so stamped -
(i) the conveyance on sale is chargeable with stamp duty under head 1 (1)
in the First Schedule;
(ii) subsection (2) (b)
(ii) applies; and
(iii) if the conveyance on sale is duly stamped, or stamped under section
5 (1) or 13 (2), before the agreement for sale is stamped, the agreement
for sale is chargeable with stamp duty of $100.
(5) Where a conveyance on sale of residential property is executed in
pursuance of a chargeable agreement for sale and is in favour of one or
some (but not all) of the persons named in the agreement as the purchaser
or purchasers, then -
(a) if the agreement for sale is duly stamped, or stamped under section 5
(1) or 13 (2) (whether before or after the execution of the conveyance on
sale), the conveyance on sale is chargeable with stamp duty under head 1
(1) in the First Schedule by reference to the consideration for the
conveyance, less a fraction of the stamp duty representing the proportion
of the residential property that, according to the agreement for sale, was
to be conveyed to the person or persons in whose favour the conveyance on
sale was executed; and for the purposes of this subsection, an agreement
that provides for a conveyance to purchasers as joint tenants shall be
treated as an agreement to convey the property to those purchasers in
equal undivided shares;
(b) if the agreement for sale is not so stamped -
(i) the conveyance on sale is chargeable with stamp duty under head 1 (1)
in the First Schedule;
(ii) subsection (2) (b) (ii) applies; and
(iii) if the conveyance on sale is duly stamped, or stamped under section
5 (1) or 13 (2), before the agreement for sale is stamped, the agreement
for sale is chargeable with stamp duty of $100.
(6) For the purposes of this section -
(a) a conveyance on sale shall be deemed to be a conveyance on sale of
residential property unless it contains a statement certifying that the
immovable property subject to the conveyance is non-residential property
within the meaning of section 29A (1);
(b) a conveyance on sale that contains such a statement may be shown to be
a conveyance on sale of residential property;
(c) a conveyance on sale is not executed in conformity with an agreement
for sale unless the conveyance on sale-
(i) is of the whole or part of the immovable property subject to the
agreement for sale; and
(ii) is in favour of the person or all persons named in the agreement for
sale as the purchaser or purchasers and no other person; but, for the
purpose of this paragraph, a person and a parent, spouse or child of that
person shall be treated as the same person;
(d) a conveyance on sale is not executed in pursuance of an agreement for
sale unless the conveyance on sale is of the whole or part of the
immovable property subject to the agreement for sale and is not executed
in conformity with the agreement for sale;
(e) a reference in subsection (3) to an agreement for sale includes a
reference to an agreement for sale made before the commencement of the
Stamp Duty (Amendment) Ordinance 1992
(8 of 1992).
29E. Section 26 inapplicable to certain agreements
Section 26 does not apply to any contract or agreement for the sale of an
equitable estate or interest in immovable property that is -
(a) a chargeable agreement for sale; or
(b) an unwritten sale agreement which would, if it were in the form of an
instrument, be a chargeable agreement for sale.
29F. Voluntary chargeable agreements for sale
(1) Any chargeable agreement for sale operating as a voluntary agreement
inter vivos shall be chargeable with stamp duty as a chargeable agreement
for sale, with the substitution of the value of the immovable property
subject to the agreement for the amount or value of the consideration for
the agreement.
(2) A chargeable agreement for sale operating as a voluntary agreement
inter vivos is not duly stamped unless the Collector has stamped the
instrument under section 13 (3) (b).
(3) Any chargeable agreement for sale (not being an agreement made in
favour of a purchaser or incumbrancer or other person in good faith and
for valuable consideration) shall for the purposes of this Ordinance be
deemed to be a chargeable agreement for sale operating as a voluntary
agreement inter vivos, and (except where marriage is the consideration)
the consideration for any agreement for sale shall not for this purpose be
deemed to be valuable consideration where -
(a) the amount of the consideration is not ascertained at the time of the
agreement; or
(b) the Collector is of opinion that by reason of the inadequacy of the
amount or value of the consideration paid or to be paid or other
circumstances the agreement for sale confers a substantial benefit on the
purchaser.
(4) Nothing in this section shall apply to a chargeable agreement for sale
made for nominal consideration for the purpose of securing the repayment
of an advance or loan, and this subsection shall have effect
notwithstanding that the circumstances exempting the agreement from charge
under this section are not set forth in the agreement.
29G. Certificate with reference to certain agreements for sale
(1) References in head 1 (1A) in the First Schedule to an agreement for
sale being certified at a particular amount mean that such agreement for
sale contains a statement certifying that the transaction agreed to, or
effected by, the instrument does not form part of a larger transaction or
series of transactions in respect of which the amount or value, or
aggregate amount or value, of the consideration exceeds that amount.
(2) In subsection (1) a reference to the amount or value of the
consideration shall be construed in relation to stamp duty chargeable on a
chargeable agreement for sale operating as a voluntary agreement inter
vivos as a reference to the value of the immovable property subject to the
agreement.
29H. Exemptions and relief
(1) This Part and the First Schedule do not apply to an agreement for sale
or an unwritten sale agreement-
(a) made in favour of the Crown or an incorporated public officer within
the meaning of section 38;
(b) of exempted premises under which agreement the purchaser is an
exempted person, within the meaning of section 38; (Amended 40 of 1992 s.
3)
(c) to which the Hong Kong Housing Authority or a person nominated by the
Hong Kong Housing Authority is a party; or
(d) which is made with the consent of the Hong Kong Housing Authority.
(2) Section 43 (1) applies to a chargeable agreement for sale in the same
manner as it applies to a conveyance on sale.
(3) If a conveyance on sale executed in conformity with a chargeable
agreement for sale (within the meaning of section 29D (6) (c)) would not,
by virtue of section 45, be chargeable with stamp duty under head 1 (1) in
the First Schedule -
(a) the agreement for sale is not chargeable with stamp duty under head 1
(1A) in the First Schedule; and
(b) section 45 (3) and (5A) applies to the agreement for sale in the same
manner as it applies to a conveyance on sale.
29I. Expiration of this Part and head 1 (1A) in First Schedule
(1) This Part and head 1 (1A) in the First Schedule shall expire at
midnight on 31 December 1993.
(2) The Legislative Council may by resolution amend subsection (1) by
substituting for the date specified in that subsection such date as may be
specified in the resolution.
(3) When this Part and head 1 (1A) in the First Schedule expire, the
following provisions shall also expire -
(a) in section 15 (3) (a), the words, "or is an agreement for sale that
contains a statement to the effect that it relates to non-residential
property within the meaning of section 29A (1)";
(b) in the First Schedule, in the square brackets alongside "FIRST
SCHEDULE", the section numbers "29A, 29C, 29D, 29G, 29H, 29I,";
(c) the words "AGREEMENT FOR SALE and section 29E, and" in the item
relating to an Agreement or Contract for Sale of equitable interest, in
head 1 in the First Schedule;
(d) Note 5 to head 1 (1) in the First Schedule;
(e) the words "Voluntary Chargeable Agreements for Sale-see section 29F"
at the end of head 1 in the First Schedule.
(4) Where, after the expiration of this Part and head 1 (1A) in the First
Schedule, a conveyance on sale of residential property is made in
pursuance of a chargeable agreement for sale made before that expiration,
section 29D shall apply notwithstanding that expiration.
(Part III A added 8 of 1992 s. 4)
PART IV UNIT TRUSTS
30. Interpretation of Part IV
(1) (Omitted as spent)
(2) In this Part -
"certificate to bearer", in relation to a unit under a unit trust scheme,
means a document by the delivery of which the unit can be transferred;
"trust instrument", in relation to a unit trust scheme, means the trust
deed or other instrument (whether under seal or not) creating or recording
the trusts by virtue of which persons are to participate in such scheme;
"trust property", in relation to a unit trust scheme, means property
subject to the trusts of the trust instrument;
"unit", in relation to a unit trust scheme, means a right or interest
(whether described as a unit, as a sub-unit or otherwise) of a beneficiary
under the trust instrument; "unit trust scheme" means any arrangements
made for the purpose, or having the effect, of providing, for persons
having funds available for investment, facilities for the participation by
them, as beneficiaries under a trust, in any profits or income arising
from the acquisition, holding, management or disposal of any property
whatsoever.
(3) Where a person authorizes or requires the trustees or managers under a
unit trust scheme to treat him as no longer interested in a unit under
that scheme and authorizes or requires them to treat another person as
entitled to that unit, he shall be deemed for the purposes of this
Ordinance to transfer that unit, and any instrument whereby he gives the
authority or makes the requirement or any other instrument expressed to be
substituted therefor by the managers with the approval of the Collector
shall be deemed for those purposes to be a transfer operating as a
voluntary disposition inter vivos under section 27 (4) or a transfer by
way of sale falling within head 2 (4) in the First Schedule according to
the nature of the transaction as between him and the person whom he
authorizes or requires the trustees or managers to treat as entitled to
the unit. (Amended 77 of 1981 s. 7)
(4) Where a person authorizes or requires the trustees or managers under a
unit trust scheme to treat him as no longer interested in a unit under
that scheme and does not authorize or require them to treat another person
as entitled to that unit, he shall be deemed for the purposes of this
Ordinance to transfer that unit to the managers by way of sale, and any
instrument whereby he gives the authority or makes the requirement or any
other instrument expressed to be substituted therefor by the managers with
the approval of the Collector shall be deemed for those purposes to be a
transfer falling within head 2 (4) in the First Schedule. (Amended 77 of
1981 s. 7)
(5) Where the managers under a unit trust scheme authorize or require the
trustees under that scheme to treat a person as entitled to a unit
thereunder and their power so to do arises from a previous transfer to
them of that unit or some other unit, they shall be deemed for the
purposes of this Ordinance to transfer the first-mentioned unit to that
person by way of sale, and any instrument whereby they give the authority
or makes the requirement or any other instrument expressed to be
substituted therefor by the managers with the approval of the Collector
shall be deemed for those purposes to be a transfer falling within head 2
(4) in the First Schedule; but this subsection does not apply to anything
done by the managers for the purpose merely of recognizing or giving
effect to a transmission of a unit by operation of law. (Amended 77 of
1981 s. 7)
31. Duty of trustees and managers to keep records
(1) The trustees of a unit trust scheme shall keep a record showing the
number of units under the scheme representing the trust property, and from
time to time as soon as any change occurs in the amount of such property
they shall enter in the record the alteration in the number consequential
on such change.
(2) The managers of a unit trust scheme shall keep a record showing -
(a) the number of units to which they become entitled in consequence of
any addition to the trust property and the date on which they become so
entitled; and
(b) where any units are extinguished, the number of units extinguished and
the date of extinction.
32. Numbering and preservation of certificates and instruments of transfer
(1) Every registered certificate and every certificate to bearer in
respect of units under a unit trust scheme shall before issue be given a
serial number by the trustees of the scheme and, when surrendered by the
holder, shall be preserved by the trustees in such a manner as to enable
reference to be made readily thereto.
(2) Every instrument of transfer in respect of units under a unit trust
scheme shall, when delivered to the trustees of the scheme, be preserved
by the trustees in such a manner as to enable reference to be made readily
thereto.
33. Register of holders of registered units
The trustees of a unit trust scheme shall keep a register of the holders
of registered units under the scheme and shall enter therein the following
particulars -
(a) the name and address of each person who holds any units under the
scheme, the serial number of the certificate or certificates representing
the units held by each such person and the number of units to which each
such certificate relates;
(b) the date or dates on which each such person became the holder of any
units and the number of units of which he became the holder on each such
date, and -
(i) where he became the holder by virtue of an instrument of transfer, or
in consequence of the surrender of a certificate to bearer, a sufficient
reference to enable the instrument or certificate to be readily produced;
(ii) where he became entitled to the units by operation of law,
particulars of the name of the person from whom the right to such units
was transmitted to him, and of the circumstances in which it was so
transmitted or a sufficient reference to some other record kept by the
trustees containing those particulars;
(c) Where any person has ceased to hold any units, the date or dates at
which he ceased to hold them, and-
(i) where he so ceased by virtue of an instrument of transfer, or in
consequence of the issue of a certificate to bearer, a sufficient
reference to the instrument of transfer to enable it to be readily
produced or, as the case may be, a note of the serial number of the
certificate to bearer;
(ii) where his right to any units has been transmitted to another person b
operation of law, particulars of the name of that person, and of the
circumstances in which it was so transmitted, or a sufficient reference to
some other record kept by the trustees containing those particulars.
34. Register of certificates to bearer
(1) Where any units under a unit trust scheme are represented by a
certificate to bearer, the trustees of the scheme shall enter in a
separate part of the register referred to in section 33, or in a separate
register, the following particulars -
(a) the fact of the issue of the certificate and the serial number of the
certificate;
(b) the number of units included in the certificate; and
(c) the date of the issue of the certificate.
(2) Upon the surrender and cancellation of any certificate to bearer, a
note of the date of surrender shall be added to the entry.
35. Form and period of preservation of records
(1) Registers or records required under this Part may be kept by recording
the matters in question -
(a) in bound books or any other legible form; or
(b) otherwise than in a legible form so long as the recording is capable
of being reproduced in a legible form, but where any such register or
record is kept otherwise than by making entries in a bound book, adequate
precautions shall be taken for guarding against falsification and
facilitating its discovery.
(2) Unless the register kept under section 33 is in such a form as to
constitute in itself an index, the trustees of the scheme shall keep in a
convenient form an index of the names of the holders.
(3) The registers, statements and other records and documents referred to
in this Part shall be preserved during the life of the trust scheme and
for a period of not less than 1 year thereafter, but nothing in this Part
shall require instruments of transfer or registered certificates or
certificates to bearer to be preserved for a period exceeding 6 years from
the date on which they were finally delivered to the trustees of the
scheme.
36. Restriction on registration of transfer of units
Notwithstanding anything in the trust instrument of a unit trust scheme,
the trustees or managers under the scheme shall not register a transfer of
units thereunder unless an instrument of transfer of units thereunder
unless an instrument of transfer has been delivered to them; but nothing
in this section shall prejudice any power of the trustees or managers to
register as entitled to a unit any person to whom the right to that unit
has been transmitted by operation of law.
37. Penalty
Any person who -
(a) being a trustee of a unit trust scheme fails to comply with any of the
provisions of section 31 (1), 32, 33, 34, 35 (2) or (3), or 36;
(b) being a manager of a unit trust scheme fails to comply with any of the
provisions of section 31 (2), 35 (3) or 36,
shall incur a penalty of $1,000 which shall be recoverable by the
Collector as a civil debt due to the Crown.
PART V EXEMPTION AND RELIEF
38. Interpretation of Part V
In this Part -
"exempted institution" means a charitable institution or trust of a public
character which is exempt from tax under section 88 of the Inland Revenue
Ordinance (Cap. 112); "exempted person" means any person in respect of
whom the Chief Secretary has issued a certificate under section 43 (3)
(b);
"exempted premises" means any premises in respect of which the Chief
Secretary has issued a certificate under section 43 (3) (a); (Added 40 of
1992 s. 4) "Government" means-
(a) the Government of Hong Kong;
(b) the Government of the United Kingdom; "incorporated public officer"
means any of the following -
(a) The Financial Secretary Incorporated (Cap. 1015); (Amended L. N. 180
of 1985)
(b) Director of Education Incorporated (Cap. 1098);
(c) The Director of Social Welfare Incorporated (Cap. 1096);
(d) The Secretary for Home Affairs Incorporated (Cap. 1044); (Amended 61
of 1984 s. 5; L. N. 190 of 1986; L. N. 263 of 1989)
(Amended 40 of 1992 s. 4)
39. Instruments generally exempted
The following instruments shall not be chargeable with stamp duty under
this Ordinance -
(a) all instruments duly stamped under the stamp regulations enforced by
the Japanese in Hong Kong between 26 November 1942 and 1 September 1945;
(b) all conveyances on sale to the Crown or an incorporated public
officer;
(c) all grants by the Crown and all Crown leases and all surrenders of
such grants and leases;
(d) all instruments executed by the Housing Authority for the purposes of
the housing Ordinance (Cap. 283) other than a conveyance on sale executed
for the purposes of section 17A thereof;
(e) all instruments executed by the Urban Council for the purposes of the
Urban Council Ordinance (Cap. 101);
(ea) all instruments executed by the Regional Council for the purposes of
the Regional Council Ordinance (Cap. 385); (Added 39 of 1985 s. 60)
(f) all conveyances on sale of exempted premises to an exempted person;
(Amended 40 of 1992 s. 5)
(g) all instruments exempted under section 125 of the Bankruptcy Ordinance
(Cap. 6), or section 281 of the Companies Ordinance (Cap. 32).
40. Instruments specially exempted
(1) In the case of any instrument in respect of which, by virtue of
section 41 or 43 (1), no person is liable for the payment of stamp duty
chargeable thereon, the instrument shall not be chargeable with stamp duty
if, but only if, it is presented to the Collector for stamping.
(2) Any instrument presented to the Collector under this section, and any
duplicate or counterpart of such instrument, shall, without payment of an
adjudication fee and notwithstanding section 13 (4), be stamped under
subsection (3) (a) of that section with a stamp denoting that it is not
chargeable with stamp duty, and subsection (6) of that section shall apply
accordingly.
41. Non-liability of Government or public officer for payment of stamp
duty
(1) Notwithstanding section 4 (3), the Government or any incorporated
public officer or any person acting in his capacity as a public officer
shall not be liable for the payment of stamp duty chargeable on any
instrument or any penalty payable in respect thereof under section 9.
(2) Subsection (1) does not apply to -
(a) any public officer acting in his capacity as -
(i) Official Administrator;
(ii) Official Receiver;
(iii) Official Trustee; or
(iv) liquidator; or
(b) any public officer acting in pursuance of any order of any court.
42. Relief in case of certain leases etc. to Government
(1) This section applies to a lease or agreement for a lease (other than
an instrument to which section 39 applies) made between -
(a) the Government, or any person acting on behalf of the Government; or
(b) an incorporated public officer,
and any other person ("the other party") not being a person to whom
section 43 (1) applies.
(2) Every instrument to which this section applies shall, for the purposes
of this Ordinance, be deemed to contain a provision whereby the other
party undertakes to pay 50 per cent of the stamp duty chargeable on such
instrument; and payment of that amount under a provision deemed by virtue
of this section to be contained in an instrument shall be deemed to
constitute payment of the stamp duty chargeable on the instrument.
43. Relief in case of certain leases etc. of consular premises
(1) Where an exempted person or a person acting on behalf of an exempted
person is a party to any instrument being a lease, agreement for a lease
or conveyance on sale of exempted premises, the exempted person or any
person acting on behalf of the exempted person shall not be liable for the
payment of stamp duty chargeable on such instrument or any penalty payable
in respect thereof under section 9. (Amended 61 of 1984 s. 5; 18 of 1985
s. 5; 44 of 1985 s. 7; 36 of 1989 s. 5)
(2) Every lease or agreement for a lease (other than an instrument to
which section 39 applies) made in respect of exempted premises between an
exempted person, or a person acting on behalf of an exempted person, and
any other person (other than the Government, an incorporated public
officer or an exempted person) shall be deemed to contain a provision
whereby such other person undertakes to pay 50 per cent of the stamp duty
chargeable on such instrument; and payment of that amount under a
provision deemed by virtue of this subsection to be contained in an
instrument shall be deemed to constitute payment of the stamp duty
chargeable on the instrument. (Amended 61 of 1984 s. 5; 18 of 1985 s. 5;
44 of 1985 s. 7; 36 of 1989 s. 5)
(3) The Chief Secretary may certify -
(a) (i) in respect of premises which are exempt from taxation under the
Consular Relations Ordinance (Cap. 259), that such premises are exempted
premises for the purposes of this Part;
(ii) in respect of premises which are exempt from taxation under the
Chinese Visa Office (Privileges and Immunities) Ordinance (Cap. 224), that
such premises are exempted premises for the purposes of this Part;
(iii) in respect of premises which are exempt from taxation under the
Privileges and Immunities (Joint Liaison Group and Land Commission)
Ordinance (Cap. 36), that such premises are exempted premises for the
purposes of this Part; (Added 18 of 1985 s. 5. Amended 44 of 1985 s. 7)
(iv) in respect of premises which are exempt from taxation under the
Privileges and Immunities (International Committee of the Red Cross)
Ordinance (Cap. 402), that such premises are exempted premises for the
purposes of this Part; and (Added 36 of 1989 s. 5)
(b) (i) in respect of any diplomatic agent or consular officer within the
meaning of the Consular Relations Ordinance (Cap. 259), that such person
is an exempted person for the purposes of this Part;
(ii) in respect of an officer of the Visa Office within the meaning of the
Chinese Visa Office (Privileges and Immunities) Ordinance (Cap. 224), that
such person is an exempted person for the purposes of this Part;
(iii) in respect of a person to whom the Privileges and Immunities (Joint
Liaison Group and Land Commission) Ordinance (Cap. 36) applies, that such
person is an exempted person for the purposes of this Part; and (Added 18
of 1985 s. 5. Amended 44 of 1985 s. 7)
(iv) in respect of a delegate within the meaning of the Privileges and
Immunities (International Committee of the Red Cross) Ordinance (Cap.
402), that such person is an exempted person for the purposes of this
Part. (Added 36 of 1989 s. 5)
(Replaced 61 of 1984 s. 5. Amended 18 of 1985 s. 5; 40 of 1992 s. 6)
44. Relief in case of gift to exempted institution
(1) Stamp duty under head 1 (1) or head 2 (3) in the First Schedule shall
not be chargeable on an instrument to which this section applies.
(2) This section applies to the following instruments -
(a) any conveyance of immovable property operating as a voluntary
disposition inter vivos where the beneficial interest therein passes by
way of gift from the person entitled to that interest to or on trust for
an exempted institution;
(b) any transfer of Hong Kong stock operating as a voluntary disposition
inter vivos where the beneficial interest therein passes by way of gift
from the registered owner or transferor of the Hong Kong stock to or on
trust for an exempted institution.
(3) An instrument to which this section applies shall not be duly stamped
unless it is stamped with the stamp duty with which it would, but for this
section, be chargeable or it has, in accordance with section 13, been
stamped with a particular stamp denoting either that it is not chargeable
with any stamp duty or that it is duly stamped.
45. Relief in case of conveyance from one associated body corporate to
another
(1) Stump duty under head 1 (1), 2 (1) and 2 (3) in the First
schedule shall not be chargeable on an instrument to which this section
applies.
(2) Subject to subsections (4), (5), (5A)and (6), this section applies to
any instrument as respects which it is shown to the satisfaction of the
Collector that the effect thereof is to convey a beneficial interest in
immovable property, or to transfer a beneficial interest in Hong Kong
stock, from one associated body corporate to another, and also applies to
any instrument that is a contract note in respect of a sale or purchase of
Hong Kong stock made between one associated body corporate and another,
where in each case the bodies are associated, that is to say, one is
beneficial owner of not less than 90 per cent of the issued share capital
of the other, or a third such body is beneficial owner of not less than 90
per cent of the issued share capital of each.
(3) An instrument to which this section applies and that conveys a
beneficial interest in immovable property or is a contract note shall not
be duly stamped unless it is stamped with the stamp duty with which it
would, but for this section, be chargeable or it has, in accordance with
section 13, been stamped with a particular stamp denoting either that it
is not chargeable with any stamp duty or that it is duly stamped.
(4) this section shall not apply to any instrument unless it is also shown
to the satisfaction of the collector that the instrument was not executed,
or the sale or purchase of the Hong Kong stock was not made, in pursuance
of or in connexion with an arrangement under which -
(a) the consideration, or any part or the consideration, for the
conveyance, transfer, sale or purchase was to be provided or received,
directly or indirectly by a person other than a body corporate which at
the time of the sale or purchase, or of the execution of the conveyance or
transfer, was associated within the meaning of subsection (2) with either
the transferor or the transferee (meaning respectively, the body corporate
from whom and the body corporate to whom the beneficial interest was
conveyed or transferred, or the Hong Kong stock was purchased or sold);
(b) the said interest was previously conveyed, transferred, purchased or
sold, directly or indirectly, by such a person; or
(c) the transferor and the transferee were to cease to be associated
within the meaning of subsection (2) by reason of a change in the
percentage of the issued share capital of the transferee in the beneficial
ownership of the transferor or a third body corporate.
(5) Without prejudice to the generality of paragraph (a) of subsection
(4), an arrangement shall be treated as within that paragraph if it is one
under which the transferor or the transferee, or a body corporate
associated with either as there mentioned, was to be enabled to provide
any of the consideration, or was to part with any of it, by or in
consequence of the carrying out of a transaction or transactions
involving, or any of them involving, a payment or other disposition by a
person other than a body corporate so associated.
(5A) Where a transferor and transferee, as described in subsection (4),
cease to be associated as described in subsection 4 (c) within 2 years
after the date of execution of the instrument or, in the case of contract
note, within 2 years after the date on which the note was required to have
been made and executed under section 19, and relief from stamp duty has
been claimed under this section -
(a) the transferor and transferee shall notify the Collector of that fact
and of the date of the cessation within 30 days after the date of the
cessation;
(b) any pending claim for relief from stamp duty under this section in
relation to the instrument shall be deemed to be denied;
(c) if any relief from stamp duty has been granted by the collector under
this section, the transferor and transferee are liable or jointly and
severally liable, as the case may be, to pay to the collector, within 30
days after the date of the cessation, by way of stamp duty an amount equal
to the stamp duty which would have been chargeable on the instrument as if
no relief from stamp duty had been granted by the Collector under this
section; and
(d) if the amount referred to in paragraph (c) is not paid within the 30
days, the transferor and transferee are liable or jointly and severally
liable, as the case may be, to a penalty calculated under section 9, and
for that purpose section 9 applies in relation to the stamping of the
instrument as it applies in relation to the stamping of an instrument
chargeable with stamp duty which is not stamped before or within the time
for stamping it. (Added 43 of 1991 s. 6)
(6) The ownership referred to in subsections (2) and (4) is ownership
either directly or through another body corporate or other bodies
corporate, or partly directly and partly through another body corporate or
other bodies corporate, and the Third Schedule shall apply accordingly for
the purposes of this section.
(7) A person who fails to comply with subsection (5A) (a) shall incur a
penalty of $1,000 which shall be recoverable by the Collector as a civil
debt due to the Crown. (Added 43 of 1991 s. 6)
(Amended 43 of 1991 s.6)
46. Instruments affecting immovable property made for new Crown lease or
exchange to be exempt
(1) Where the Director of Buildings and Lands certifies that any
instrument affecting any immovable property held from the Crown has been
executed in compliance with his requirements for the sole purpose of
enabling a Crown lease of the immovable property to be granted to the
owner thereof and has been replaced by a new instrument affecting the
immovable property in the same manner as, and similar as far as possible
to, the instrument replaced, and executed immediately upon the granting of
the said Crown lease, then such instruments shall be exempt from stamp
duty, and the Collector shall, on production to him of the instruments so
certified, endorse thereon a certificate to the effect that the
instruments are by virtue of this section exempt from stamp duty.
(2) Where the Director of Buildings and Lands certifies that any
instrument affecting any immovable property held from the Crown has been
executed in compliance with his requirements for the sole purpose of
enabling the owner of the immovable property to surrender it to the Crown
as consideration or part consideration for an exchange and has been
replaced by a new instrument affecting the immovable property in the same
manner as, and similar as far as possible to, the instrument replaced, and
executed immediately upon the granting of the said Crown lease, then such
instruments shall be exempt from stamp duty, and the Collector shall, on
production to him of the instruments so certified, endorse thereon a
certificate to the effect that the instruments are by virtue of this
section exempt from stamp duty.
(Amended 8 of 1993 s. 3)
47. Instruments confirmatory of transactions during Japanese occupation to
be exempt
(1) Whenever the Land Registrar certifies that in his opinion an
assignment or reassignment has been made by the appropriate parties solely
for the purpose of carrying into effect a transaction or a series of
transactions in respect whereof an instrument or a series of instruments
has been registered or recorded in the Japanese House Registration Office
and of effectuating by an assignment or reassignment in the form in common
use in Hong Kong the transaction or series of transactions which to him
appears to have been intended to be effected by such instrument or series
of instruments, then such assignment or reassignment shall be exempt from
stamp duty. (Amended 8 of 1993 s. 3)
(2) The certificate under subsection (1) shall be endorsed upon the
instrument in question, and on production of the certificate under
subsection (1) and of the instrument in question the Collector shall
endorse thereon a certificate to the effect that the same is under this
section exempt from stamp duty.
(3) This section shall not apply to any instrument executed in
contravention of the Moratorium Proclamation of the British Military
Administration dated 13 September 1945.
PART VI ALLOWANCE FOR SPOILED OR UNWANTED STAMPS
48. Allowance for spoiled stamps
(1) Subject to subsection (2) and to the production of such evidence, by
statutory declaration or otherwise, as the Collector may require,
allowance shall be made by the Collector for any stamp spoiled in any of
the following cases -
(a) where the stamp on any material is inadvertently spoiled, obliterated
or by any means rendered unfit for the purpose intended before the
material bears the signature of any person or any instrument written
thereon is executed by any party; (b) where an adhesive stamp is
inadvertently spoiled or rendered unfit for use and has not in the opinion
of the Collector been affixed to any material;
(c) where the stamp is used for any instrument executed by any person
which-(i) is afterwards found to be absolutely void from the beginning;
(ii) is afterwards found to be unfit, by reason of any error or mistake
therein, for the purpose originally intended;
(iii) has not been made use of for any purpose whatever and, by reason of
the inability or refusal of some necessary party to sign the instrument or
to complete the transaction according to the instrument, is incomplete and
insufficient for the purpose for which it was intended;
(iv) fails of its intended purpose, or becomes void, by reason of the
refusal of any person to act under the instrument or for want of enrollmen
or registration thereof within the time required by law; or
(v) is inadvertently spoiled and in lieu thereof another instrument made
between the same parties and for the same purpose is executed and duly
stamped, or becomes useless in consequence of the transaction intended to
be thereby effected being effected by some other instrument duly stamped.
(2) This section shall not apply unless -
(a) the application for allowance is made within 2 years after the stamp
has been spoiled or become useless or, in the case of an instrument
executed by any person, after the date of the instrument or if it is not
dated within 2 years after the execution thereof by the person by whom it
was first or alone executed, or such further time as the Collector may
determine in the case of any instrument sent abroad for execution or where
from unavoidable circumstances any instrument for which another has been
substituted cannot be produced within the said period; and
(b) in the case of an executed instrument, no legal proceeding (other than
legal proceedings in which the question whether the instrument is void
falls to be determined) has been commenced in which the instrument could
or would have been given or offered in evidence and, if the Collector so
requires, the instrument is given up to be cancelled.
49. Allowance for misused stamps
Where any person has inadvertently used for any instrument chargeable with
stamp duty a stamp of greater value than was necessary, or has
inadvertently used a stamp for an instrument not chargeable with stamp
duty, the Collector may, on application made within 2 years after the date
of the instrument or, if it is not dated, within 2 years after the
execution thereof by the person by whom it was first or alone executed,
and upon the instrument, if chargeable with stamp duty, being stamped with
a stamp denoting payment of the stamp duty chargeable thereon, cancel and
allow as spoiled the stamp to misused.
50. Allowance for unwanted adhesive stamps
The Collector may, upon application by any person being the purchaser of
an adhesive stamp which has not been spoiled or rendered unfit or useless
for the purpose intended, make allowance to such person in respect thereof
if -
(a) the adhesive stamp is delivered up to the Collector; and
(b) the Collector is satisfied that the adhesive stamp was purchased by
such person-
(i) at the office of the Collector within a period of not more than 2
years preceding the application; and
(ii) with a bona fido intention to use it.
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