ORSO news

Change to the ORSO Offsetting Arrangement

Currently, vested benefits attributable to the employer's contributions to the ORSO Scheme can be used to offset statutory long service payment or severance payment (the LSP/SP) payable to the employees in accordance with the Employment Ordinance (the 'ORSO Offsetting Arrangement').

Effective from 1 May 2025 (the Transition Date), the ORSO Offsetting Arrangement will be changed (the Change). The implications of the change are summarised as follows:

• For an employee whose employment commences prior to the Transition Date and is terminated on or after the Transition Date:

1. With respect to the employee's years of service prior to the Transition Date: The employer may offset the pre-Transition portion of LSP/SP against both the Non-Offsetable Benefits* and Remaining Benefits** (if any) attributable to the employee's years of service prior to the Transition Date; and

2. With respect to the employee's years of service from and including the Transition Date: The employer may offset the post-transition portion of LSP/SP against the Remaining Benefits (if any) attributable to the employee's years of service from and including the Transition Date. However, the employer can't use the Non-Offsetable Benefits to offset the post-tansition portion of LSP/SP.

• For an employee whose employment commences on or after the Transition Date, the employer may offset the LSP/SP against the Remaining Benefits but can't offset the LSP/SP against the Non-Offsetable Benefits.

For further details and illustrative examples of the change, please visit the Thematic Webpage of the Labour Department.

Remarks:

*'Non-Offsetable Benefits' is an amount calculated using the formula below:

Non-Offsetable Benefits = Average monthly relevant income in the 12 months immediately preceding the termination of employment (subject to the statutory cap of HKD30,000, as of the notice dated 28 March 2025) x Years of service with ORSO Scheme on and after 1 December 2000 x 5% x 12

**'Remaining Benefits' is the vested benefits attributable to the employer's contributions less the Non-Offsetable Benefits.

Important notes

• The information contained in this website is for reference only and will be updated from time to time without notice. The provisions of the Occupational Retirement Schemes Ordinance, other applicable legislation/regulations and guidelines or announcements published by the Mandatory Provident Fund Schemes Authority and/or Securities and Futures Commission shall prevail for any information on ORSO system. If you are in doubt about the meaning or the effect of the contents of this website, you should seek independent professional advice.
• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant brochure.

Changes to the Principal Brochures of Wayfoong Multi-funding System (“WMFS”) and Wayfoong Multi-funding System - Deferred Member Arrangement ("WMFS DMA") in relation to the use of financial futures contracts

With effect from 25 November 2024 (the "Effective Date"), the disclosures in the Principal Brochures of the WMFS and WMFS DMA with respect to the use of financial futures contracts by certain Underlying Fund(s) invested into by certain Investment Portfolio(s) have been changed in order to address settlement mismatch due to the shorter cycle rule amendments from the U.S. Securities and Exchange Commission ("SEC").  

The Principal Brochures (together with their supplements) of WMFS and WMFS DMA have been issued to reflect the changes described above and the consequential changes. You may refer to the Notice dated 25 November 2024 and the updated Principal Brochures for further details of the changes.

Important notes

• The information contained in this website is for reference only and will be updated from time to time without notice. The provisions of the Occupational Retirement Schemes Ordinance, other applicable legislation/regulations and guidelines or announcements published by the Mandatory Provident Fund Schemes Authority and/or Securities and Futures Commission shall prevail for any information on ORSO system. If you are in doubt about the meaning or the effect of the contents of this website, you should seek independent professional advice.   
• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant brochure.

Changes to the Principal Brochure and the insurance policy of Wayfoong Multi-funding System (“WMFS”) and Wayfoong Multi-funding System - Deferred Member Arrangement ("WMFS DMA") in relation to the revised SFC's Code on Pooled Retirement Funds (“PRF Code”)

The SFC has revised the PRF Code. With effect from 30 November 2022 (the "Effective Date"), the Principal Brochure and the insurance policy of the WMFS and WMFS DMA have been revised to reflect the requirements of the revised PRF Code ("Revised PRF Code"). Please refer to below for more details.

Changes to the Principal Brochure

The Principal Brochure has been revised to reflect the requirements of the Revised PRF Code. In particular:

• the disclosure relating to each Investment Portfolio has been updated per the Revised PRF Code;
• the disclosure of each Investment Portfolio has been enhanced (including the investment restrictions and risk factors), taking into account the latest requirements of the Revised PRF Code; and
• certain cosmetics and stylistic changes have been made to the Principal Brochure, and the sequence of the contents of the Principal Brochure have been adjusted, to enhance clarity and readability.

Changes to the insurance policy

We have taken this opportunity to revise the insurance policy constituting the WMFS and WMFS DMA to ensure its compliance with Appendix B to the Revised PRF Code. In particular, the insurance policy has been revised to:

• specify that the functions, duties and obligations of the key operators of the WMFS and WMFS DMA and the investment strategies and restrictions of the Investment Portfolios are as set out in the Principal Brochure;
• specify the Insurer's obligations to ensure that the insurance policy of the WMFS and WMFS DMA contains all the information listed in Appendix B to the Revised PRF Code; and
• specify that any taxes and expenses charged to the Investment Portfolios or levied against the Investment Portfolios shall be on a basis deemed fair and reasonable by an actuary or other person of professional standing.

From the Effective Date onwards, the updated Principal Brochure is available for download at www.hsbc.com.hk/orso, while the insurance policy (together with its endorsements) constituting the WMFS and WMFS DMA is available for inspection at 18/F, Tower 1, HSBC Centre, 1 Sham Mong Road, Kowloon, Hong Kong.

Important notes

• The information contained in this website is for reference only and will be updated from time to time without notice. The provisions of the Occupational Retirement Schemes Ordinance, other applicable legislation/regulations and guidelines or announcements published by the Mandatory Provident Fund Schemes Authority and/or Securities and Futures Commission shall prevail for any information on ORSO system. If you are in doubt about the meaning or the effect of the contents of this website, you should seek independent professional advice.   
  
• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant brochure.

General notice to Wayfoong Multi-funding System – Deferred Member Arrangement ('WMFS DMA') scheme participants regarding the introduction of partial withdrawal

With effect from 23 August 2021, there will be an additional option available for WMFS DMA scheme participants to partially withdraw their retirement benefits. This change is expected to provide members with greater flexibility in managing their cash flow and continuing investments.

At eligible scheme participants’ decision, they can request to partially withdraw their retirement benefits by submitting to us a valid and duly completed the Deferred Member Arrangement – Partial Withdrawal Request Form.

Any partial withdrawal request for the payment of benefits will be subject to the satisfaction of certain conditions mentioned in the Deferred Member Arrangement – Partial Withdrawal Request Form, and in the WMFS DMA Principal Brochure.

WMFS DMA scheme participants may request copies of the updated Principal Brochure or a copy of the Deferred Member Arrangement – Partial Withdrawal Request Form by calling our enquiry hotline on (852) 2288 6655.

Important notes

• The information contained in this website is for reference only and will be updated from time to time without notice. The provisions of the Occupational Retirement Schemes Ordinance, other applicable legislation/regulations and guidelines or announcements published by the Mandatory Provident Fund Schemes Authority and/or Securities and Futures Commission shall prevail for any information on ORSO system. If you are in doubt about the meaning or the effect of the contents of this website, you should seek independent professional advice.
• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant brochure.

Establishment of the new investment choice and changes in frequency of portfolio rebalancing and redirection of future contributions (23 November 2020)

Establishment of the new investment choice

With effect from 23 November 2020, the Hang Seng Index Tracker Fund (‘New Fund’) will be available as a new investment choice under Wayfoong Multi-funding System (‘WMFS’) (applies to Hong Kong dollar schemes only). The addition of the New Fund under WMFS will provide an alternative fund choice to members / employers.

Portfolio rebalancing and redirection of future contributions

To provide members / employers a greater flexibility when allocating their investments under the WMFS, with effect from 1 December 2020, WMFS will be enhanced to allow instructions for portfolio rebalancing of existing balances and redirection of future contributions to be done weekly on the relevant valuation day (which will be the 7th, 14th, 21st, 28th of each month or, where it is not a business day, the next available business day), except the Capital Guaranteed Fund, 4% Guaranteed Fund, 5% Guaranteed Fund and Central Provident Fund. For further information of the changes described above, please refer to the updated Principal Brochure (together with its supplement), and the 'Change of investment instruction by member (!NCI06)' form or ‘Change of investment instruction by employer (INCI51)’ (INCI51) form. You should only use the new forms from the 23 November 2020 onwards.

The ‘Principal Brochure’ (together with its supplement) of WMFS has been issued to reflect the changes described above and the consequential changes. You may refer to the Notice dated 30 October 2020 and the updated ‘Principal Brochure’ for further details of the changes.

Update on ORSO Money Market Funds (21 August 2020)

The outbreak of COVID-19 pandemic has a significant impact on the global economy. While the US Federal Reserve’s actions to keep interest rates near zero in June, Hong Kong dollar (HKD) money market rates have also been impacted by a number of factors affecting liquidity.

Overall, liquidity yields may remain low compared to last year given the economic impact of the COVID-19 pandemic and easing policies by global central banks.

The ORSO Money Market Funds generally aim to provide liquidity together with a rate of return higher than the bank savings rate. However, we would like to remind investors that investment in money market funds is different from depositing funds in a savings account at a bank or deposit-taking company. These funds are not capital-protected, and there is no guarantee that a stable net asset value will be maintained. Investors may not get back the amount originally invested.

Update on the ORSO Amendment Bill for ORSO registered and exempted schemes (3 July 2020)

The ORSO Amendment Bill was passed by the Legislative Council on 17 June 2020, and became effective on 26 June 2020. The main objective of the ORSO Amendment Bill is to set up a registration framework for the Occupational Retirement Schemes ('ORSO Schemes') to ensure they are properly regulated.

The new ORSO Amendment Bill will require employers to submit an annual written statement (for ORSO-registered and exempted schemes), an annual return (for ORSO-exempted schemes only) as well as notification of reportable events (for ORSO-registered schemes only) to the Mandatory Provident Fund Schemes Authority (‘MPFA’). For more information on the new requirements, please visit the MPFA website > ORSO > Circulars > Occupational Retirement Schemes (Amendment) Bill 2019.

The MPFA had also invited employers to attend their upcoming Town Hall sessions (28, 29, 30 July 2020) to facilitate employers in gaining a better understanding of the new requirements under the new regulatory requirement. By 6 July 2020, employers will need to register and complete the ‘Reply slip’ contained in the abovementioned circular. We strongly encourage employers to register and attend the upcoming Town Hall sessions.

Important notes

• The information contained in this website is for reference only and will be updated from time to time without notice. The provisions of the Occupational Retirement Schemes Ordinance, other applicable legislation/regulations and guidelines or announcements published by the Mandatory Provident Fund Schemes Authority and/or Securities and Futures Commission shall prevail for any information on ORSO system. If you are in doubt about the meaning or the effect of the contents of this website, you should seek independent professional advice.
• Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the relevant brochure.