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Hong Kong’s de-facto central bank and regulator has reportedly issued a draft code of practice designed to improve how trust businesses are supervised.
The code, issued by the Hong Kong Monetary Authority, will apply to authorised institutions (AIs) and subsidiaries of locally incorporated AIs which conduct trust business in Hong Kong, according to a report from the Society of Trust and Estate Practitioners.
However, there appeared to be no reference to the matter on the HKMA’s website; this publication will update in due course if the regulator confirms the STEP report.
The report said that such AIs are not subject to specific mandatory conduct requirements at the moment. The Hong Kong Trustees' Association has issued industry guides, but membership of the association is voluntary, it said.
The HKMA wants AIs and their subsidiaries to comply with the finalised code no later than six months from when it is issued. Other trustees and trust companies, including holders of a trust or company service provider licence, are being encouraged to voluntarily adopt the code where applicable.
The code is intended to improve protection of assets held in trust for customers of wealth management services, the report said.