Money Lender License in Hong Kong
Money Lender License in Hong Kong is defined as an individual or a business that carries out the activities of providing loans and advances.However, the following would not be included under the definition of a money lender license in Hong Kong:
Any individuals that carry out the business of
- Any Form of Financial Institution which comes under the definition of the Banking Ordinance (Cap 155).
- Any entity that is considered as a co-operative society which comes under the definition of a Co-operative Society Ordinance (Cap 33).
- Any form of Credit Union which comes under the meaning of the Credit Union Ordinance. If the institution comes under the meaning of the Credit Union League, it would also be included.
- Any trade union which is registered under the Trade Union Ordinance (Cap 322).
- Any form of insurer or insurance company coming under the meaning of the Insurance Ordinance(Cap 41).
- A bank that is incorporated in Hong Kong or outside the jurisdiction of Hong Kong comes under the meaning of the Banking Ordinance (Cap 155), which is considered under the monetary authority to be an institution that supervises the commercial operation of banks.
- Any institution or organization which is a member of the Berne Union.
- Any form of corporate entity that is carrying out the business of securities margin financing. (Part V of the Securities and Future Ordinance[Cap 571])
- Any form of corporate entity that is carrying out the business of exchanging securities margin financing.
The meaning of money lender would also exclude the following:
- Any form of a loan that comes under the meaning of the Money Lenders Ordinance.
Hence, a money lender is a person or institution carrying on the main business of lending and exchange of money.
Regulatory Authority for Money Lender License in Hong Kong
The primary regulatory authority for Money Lender License in Hong Kong is the Companies Registry of Hong Kong. Money Lender License in Hong Kong is regulated by the Money Lenders Ordinance (Cap 163).
Under the money lender's ordinance (Cap 163), the activities carried out by Money Lenders, License, which is required for money lenders and any form of loans provided by a moneylender, comes under this ordinance.
Under the Money Lender License in Hong Kong, the Licencing court is the main authority that determines the eligibility of applications for grant of the license. This provision is under section 11(1) of the Money Lenders Ordinance.
Eligibility Criteria for Money Lender License in Hong Kong
Fit and Proper Individual
The applicant for the money lender license in Hong Kong must be fit and proper individual. The following must be sufficed for the fit and proper individual test:
- If the applicant for the money lender license in Hong Kong is a partnership firm, then all the individuals who are partners of the firm must satisfy the eligibility criteria of being fit and proper.
- In case the applicant is a corporate entity, then the individual who has a major controlling interest has to satisfy the fit and proper criteria. For a corporate entity, the company's management has to show that they meet the criteria of being fit and appropriate.
No form of Disqualification
Under section 11(3) of the Money Lenders Ordinance, if the individual (applicant) is disqualified under any law in Hong Kong, then the License cannot be granted. This form of disqualification would include where an individual is adjudged as an insolvent or bankrupt. Disqualification also includes being criminally penalized.
Name of the Firm
For a money lender license in Hong Kong, the firm's name should not go against any provisions of the law in force. The name of the firm should not be misleading or cause any other firm infringement, which also has a similar name. This provision is present under section 11(5) d of the Money Lenders Ordinance.
When the licensing court is granting the license for the money lender license in Hong Kong, it must not go against the interest of the public or any stakeholder. The provision is present under section 11(5) g of the Money Lenders Ordinance.
The applicant must have a registered address for conducting the business of the moneylender license in Hong Kong. The registration must be compliant with the provisions of the Money lenders ordinance. The business of money lending must be only carried out from the respective premises. This provision is present under section 11(5) e of the Money Lenders Ordinance.
Procedure for Obtaining the Money Lender License in Hong Kong
Under the money lenders ordinance, an applicant can apply for a new license for a money lender. Apart from this, the applicant can also renew the license to apply for the money lender license. Part II of the Money Lenders Ordinance governs the procedure for applying for a money lender license in Hong Kong.
Under section 8(1) of the Money Lenders Ordinance, the applicant must make an application to the respective Registrar. Along with this, the applicant has to submit respective documents with the fees. According to section 8(2) of the Money Lenders Ordinance, an individual can make an application on behalf of a company. If a partnership firm makes the application, it will be made on behalf of the partnership firm's partners. This provision comes under section 8(3) of the Money Lenders Ordinance.
The application form for a money lender license in Hong Kong can either be submitted offline or online. The application must be downloaded through the following website www.cr.gov.hk. The application form must be submitted along with the supplementary documentation. The applicant must submit the completed application and send it to the following address:
Money Lender Office,
If the application is made according to the procedure prescribed under the Money lenders ordinance, the applicant must send a copy to the Commissioner of Police of Hong Kong. This provision is present under section 9(1) of the Money Lenders Ordinance. A copy of the application form with the respective fees must be submitted to the following address:
Licensing Section, Licensing Office, Hong
Kong Police Force at 12th floor, Arsenal
House, Police Headquarters, 1 Arsenal Street,
Wan Chai, Hong Kong.
When the commissioner of the police receives a copy of the application, an investigation may be carried out to understand if there any objections against the money lender license.
If an objection has to be made regarding the application on relevant grounds, the commissioner of police has to serve the notice of the objection to the registrar. From the time of the initial application, which is made to the registrar, no other work must be carried out by the registrar. During this time, the commissioner of police sends can send a notice of objection regarding the application to the companies registry. This date is understood as the material date.
If there is any form of objection made by the registrar or the police commissioner, the same will be made to the applicant. The objection must be made under section 11 of the Money Lenders Ordinance.If an objection on the application has to be made, then the commissioner of police must make the same objection within seven days. This provision of objection is present under section 9(4) of the Money Lenders Ordinance.
If the registrar feels that there is any form of objection present in the application, and then the same will be sent to the magistrate.
The court determines whether the license has to be granted to the applicant and will fix a date of hearing the application. After this, the applicant would be given 14 clear days' notice of the hearing.
The licensing court will review the application and determine if there are any form of objections brought out by the commissioner of police as per section 9(5) of the Money Lenders Ordinance. If there isn’t any form of objections against the applicant, the licensing court will grant the license.
The licensing court may impose certain conditions for the money lender license in Hong Kong. If the license is granted subject to the above conditions, the licensee must abide by the licensing court's rules and the registry.A license will not be granted if the applicant does not pay the requisite fee.
Renewal of License
Under section 12 of the Money Lenders Ordinance, the applicant can renew the license for a money lender license in Hong Kong after the license expiry.The money lender license is valid for one year. Under section 13(1) of the Money Lenders Ordinance, the applicant must make an application for renewal of license 3 months before the expiry of the license.
Documents required for Money Lender License in Hong Kong
There are different forms and documents required for a money lender license. The following forms and documents have to be submitted to the respective authority:
Individual or Partnership
Where the applicant is either an individual or a partnership, the following forms have to be submitted:
- Form 2- Application form for the license for an individual or partnership.
- Form 4- Supporting documents and letters of support regarding the moneylender license.
- SIS-2 - SIS means the supplementary information sheet, which has to be provided where the applicant is an individual or a proprietorship concern.
- Form 6- Renewal of license application form (Individual/ Partnership).
- Form 8- Support statement related to the renewal of a license.
- SIS 4- Supplementary information related to the renewal of license (Individual/Partnership).
If the applicant is a body corporate then the following forms have to be submitted:
- Form 3- Application form for the license for the body corporate.
- Form 5- Supporting documents and the support statement which has to be provided by the company.
- SIS -1- Supplementary Information Sheet, which has to be submitted to the registry.
- Form 7- Renewal of License application form (Corporate Entity).
- Form 9- Support Statement for renewal of the license.
- SIS 3- Supplementary information related to the renewal of License (Corporate)
Form 11- Form for exemption from applying for a money lender License.
Documents required for Commissioner of Police
- Documents stating the applicant is capable of managing the business.
- Consent or permission from the landlord.
- Financial information required from the applicant.
- Land Registry Documentation.
- Floor Plan for the premises of the company.
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