There is only one protected foreign life insurance policy ownership solution possible for residents of the People’s Republic of China (PRC) because it is Hong Kong government regulated, registered and recognized by the PRC. Tax and regulatory protection you can trust is registered in pension laws which are government regulated, registered and recognized by The Peoples Republic of China (PRC).
This “Overseas Retirement Scheme Ordinance” (ORSO) entity is the only statutory asset protection and tax deferred income solution possible for residents of the People’s Republic of China because it is integrated Hong Kong pension laws that are recognized by the Peoples Republic of China,
International Investment News by Gary Robinson 26 April 2016
The China Insurance Regulatory Commission has warned investors that any insurance products sold in Hong Kong will not be protected by mainland Chinese laws. In a move that some say may be seen as another attempt by the Chinese insurance watchdog to claw back cash flowing into products based outside of the Chinese mainland, investors in Hong Kong were warned that, due to less stringent regulations in the region, mainland Chinese law will not cover any potential issues arising from these policies.
The CIRC said in a statement on its website on Friday that life policies purchased in Hong Kong would not be protected by mainland law, and urged the Chinese public to be aware of the fact
that Hong Kong has no regulations on dividend or cash value yet. It also pointed out that China has much tighter regulation than Hong Kong – similar, it said, to the regulations in force in the UK and Australia – in these areas. As a result, any potential missselling claims on these products purchased in Hong Kong will not be covered by China.
The warning, as reported in the South China Morning Post yesterday, comes after mainlanders spent HK$31.6 bn, or 24.2 per cent of the total new premiums of all life policies sold in Hong Kong last year, up from just six per cent in 2009. Mainlanders come to Hong Kong to buy US and Hong Kong dollar priced policies to escape the exchange loss due to a weaker yuan. As reported in February, the move is another effort to slow the flow of capital out of the country.
In February China’s government moved to restrict the ability of mainland Chinese to buy insurance from non-Chinese insurance companies, causing shares in insurance companies active in the Hong Kong market to slump. Hong Kong is in the process of ushering in a new soon-to-be-established Insurance Authority which is aiming be ready for full implementation in the second half of this year.
Hong Kong announced plans to replace the Office of the Commissioner of Insurance (OCI), a government body established to administer the Insurance Authority, the regulator for the insurance industry in Hong Kong, late in 2015. The new independent body will possess wider ranging powers and a specific remit to regulate insurance intermediaries directly as well.
[box style=”rounded”]Privacy and Secrecy in an ORS402(b) Financial Account is Formally Recognized by All Governments including the People Republic of China and the United States of America for Tax Deferral.[/box]
- Keep your work and family money private and secure.
- In a formal plan that is recognized by governments as deferred income on gains and accumulations is registered in Hong Kong Law that is recognized by the Peoples Republic of China.
- This holds your work and family money privately and safely for you and your family in amounts without limits.
Where money is invested or how it is invested is not a tax or exchange control issue it is a matter for that member’s own good judgment. It is not a manipulation of exchange control law. It is purely an investment account where the individual is subscribing via a Shanghai broker to be a Hong Kong retirement plan member.
[box]The Occupational Retirement Schemes Ordinance (“ORSO”) came into force on 15 October 1993, and is the governing legislation for the regulation of voluntary occupational retirement schemes operating in or from Hong Kong.[/box]
The ORSO aims to regulate the retirement schemes industry through a registration system to ensure that all voluntarily established ORSO schemes are properly administered and funded, and to provide greater certainty that retirement scheme benefits promised to employees will be paid when they fall due.
The ORSO applies to all ORSO schemes operated in and from Hong Kong. It also covers offshore schemes (i.e. schemes whose domicile is outside Hong Kong, where the scheme or trust is governed by a foreign system of law) which provide retirement benefits to members employed in Hong Kong. All ORSO schemes must be registered or granted an exemption certificate by the Registrar in accordance with ORSO.
[box type=”note”]The rules of individual ORSO schemes such as coverage, enrolment arrangements, contribution rate and vesting scale are specified in the respective governing rules of the schemes.[/box]
Occupational Retirement Schemes Ordinance (Chapter 426, Laws of Hong Kong)
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