Full legislation
s.25A
Maintenance of assets in Hong Kong in respect of general business
(1)
(Repealed
20 of 2023 s. 45
)
(2)
This
section—
(a)
(subject to paragraph (b)) applies to an authorized insurer that carries on
general business in or from Hong Kong; and
(b)
does not apply to an authorized insurer that is exempted under the rules
made under
section 129(1
)(
da)
.
(Replaced
20 of 2023 s. 45
)
(3)
Subject to subsections (6) and (8
)—
(a)
an authorized insurer must maintain assets in Hong Kong in respect of its
insurance liabilities (as referred to in subsection (3A)); and
(b)
the value of the assets so maintained must not be less than the amount
prescribed by the rules made under
section 129
.
(Replaced
20 of 2023 s. 45
)
(3A)
For the purposes of subsection (3), the insurance liabilities are
liabilities—
(a)
arising from the authorized insurer’s general business with onshore risk
carried on in or from Hong Kong (other than the part of that business that is
exempted under the rules made under
section 129(1
)(
da)
);
and
(b)
determined in accordance with the rules made under
section 129
.
(Added
20 of 2023 s. 45
)
(4)-(5)
(Repealed
20 of 2023 s. 45
)
(6)
Where the
Authority
is satisfied that there are special or unusual circumstances that make it
impracticable for
an
authorized insurer to comply with the requirements of this
section, the
Authority
may, provided
the
Authority is satisfied with the financial status of the insurer,
exempt the insurer in whole or in part from the requirements of this section and
the
Authority may attach such conditions to, or limitations in respect
of, the exemption as
the
Authority considers appropriate including, without limiting the
foregoing, a limitation on the duration of the exemption.
(Amended
12 of 2015 s. 2
)
(7)
For the avoidance of doubt,
special
or unusual
circumstances
(特殊或不尋常情況) under subsection (6) does not
include—
(a)
administrative expenses or other inconvenience associated with compliance
with this section; or
(b)
the fact that compliance with this section does not accord with
an
authorized insurer’s investment policies.
(8)
The requirements under subsection (3) to maintain assets in Hong Kong shall be
relieved to the extent, if any, of any assets which
an
authorized insurer is, by the laws of any place outside Hong Kong,
required to and does maintain in that place and which would, upon the liquidation of
the insurer, fall within the description of assets that is contained in
section
265(1
)(
e
)(
i)
of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance (
Cap. 32
).
(Amended
28 of 2012 ss. 912
& 920)
(9)
(Repealed
20 of 2023 s. 45
)
(10)
An
authorized insurer
that—
(Amended
12 of 2015 s. 44
)
(a)
takes any action or fails to take any action, which it knows will result in
a contravention of subsection (3); or
(b)
fails to comply with conditions attached to an exemption under subsection
(6), unless it establishes that, at the time it failed to so comply, it was
complying with the requirements of subsection (3),
commits an offence and is liable
to—
(i)
a fine of $200,000 and, in the case of an individual, to imprisonment for 2
years; and
(Amended
35 of 1996 s. 20
)
(ii)
a further fine of $1,000 for each day on which the insurer continues to
contravene the requirements of subsection (3) or the conditions attached to an
exemption under subsection (6), as the case may be.
(Amended
35 of 1996 s. 20
)
(11)
(Repealed
20 of 2023 s. 45
)
(12)
In this
section—
assets in Hong Kong
(
在港資產
)—
(a)
means—
(i)
assets of the type set out in
Schedule 8
; or
(ii)
other assets or guarantees, or other arrangements in lieu of
assets, approved by the Authority in writing in a particular case;
and
(b)
does not include assets the titles to which are subject to any
encumbrance or charge, other than a floating charge;
direct business
(
直接業務
) means the business of effecting and carrying out contracts of
insurance, other than contracts of reinsurance;
general business with onshore
risk
(
具在岸風險的一般業務
) means—
(a)
any direct business that satisfies any of the following
conditions—
(i)
the direct business is of a nature specified in class 1, 2, 4 or 7
in
Part 3 of Schedule 1
and—
(A)
the policy is issued in Hong Kong;
(B)
the proposal form, application form or any other form of a
similar nature is prepared, signed, submitted, received or accepted
in Hong Kong; or
(C)
the risk is accepted in Hong Kong;
(ii)
the direct business is of a nature specified in class 3 or 10 in
Part 3 of Schedule 1
and the vehicle being insured is
registered in Hong Kong;
(iii)
the direct business is of a nature specified in class 8 or 9 in
Part 3 of Schedule 1
and the property being insured is
located in Hong Kong;
(iv)
the direct business is of a nature specified in class 5, 6, 11, 12,
13, 14, 15, 16 or 17 in
Part 3 of Schedule 1
and the policy
holder—
(A)
is resident in Hong Kong; or
(B)
is a company;
(b)
any facultative reinsurance business under which the risk ceded arises
from any direct business mentioned in paragraph (a); or
(c)
any treaty reinsurance business, being general business, in relation to
which the risk is underwritten in Hong Kong, that is to
say—
(i)
the treaty is signed or accepted in Hong Kong; or
(ii)
the treaty negotiation is concluded in Hong Kong,
excluding any treaty reinsurance business under which less than 25%
of the total risk ceded (determined in terms of the gross premiums) arises
from any direct business mentioned in paragraph (a).
(Added
20 of 2023 s. 45
)