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The Government today (November 23) published the consultation conclusions of the detailed legislative proposals on the trust law reform.
"On March 22, 2012, the Government launched a public consultation to collect views on the detailed legislative proposals on the trust law reform. The reform package, through amendments to the Trustee Ordinance (Cap 29) and the Perpetuities and Accumulations Ordinance (Cap 257), seeks to clarify trustees' duties and powers, better protect beneficiaries' interests and modernise the trust law," a spokesman for the Financial Services and the Treasury Bureau said.
The Government received 23 submissions from trust service providers and practitioners, chambers of commerce, professional bodies and relevant stakeholders when the consultation exercise ended on May 21.
Respondents in general supported the reform proposals. They considered that the reformed regime would provide a more robust legal framework facilitating more effective operation of present-day trusts. This would in turn enhance the competitiveness of the local trust industry and bolster Hong Kong's status as an international asset management centre. Respondents also put forward specific proposals aimed at refining the drafting.
The spokesman said, "We are encouraged by the general support from the respondents and are grateful for their constructive comments. We have carefully considered all the comments and have refined our proposals as appropriate. We believe the proposed reform package will go a long way in providing a modernised regime to cater for the needs of present-day trusts. It also presents common denominators derived from the extensive consultations and engagements."
The Government is finalising the amendment bill in light of the outcome of the consultation, with a view to introducing it into the Legislative Council in the 2012-13 legislative session.
The major proposals of the reform package seek to:
(a) introduce a statutory duty of care on trustees;
(b) provide trustees with general powers to appoint agents, nominees and custodians, as well as to insure trust property against risks of loss;
(c) allow professional trustees to receive remuneration;
(d) provide for a court-free process for the retirement of trustees on beneficiaries' directions;
(e) impose statutory control on exemption clauses that seek to relieve professional trustees from liabilities;
(f) allow settlors to reserve to themselves some limited power;
(g) abolish outdated rules against perpetuities and excessive accumulations of income;
(h) provide for anti-forced heirship provisions; and
(i) relax the market capitalisation and dividend requirements for investment in the equity market.
The consultation conclusions are available at the website of the Financial Services and the Treasury Bureau (www.fstb.gov.hk/fsb).
Ends/Friday, November 23, 2012
Issued at HKT 18:00
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