Investment Standards and Restrictions 投資標準及限制

Investment Management 投資管理

The primary investment manager of an MPF scheme or approved pooled investment fund (APIF) must be an investment management company incorporated in Hong Kong or re-domiciled to Hong Kong. Paid-up share capital and net assets must each be at least HK$10 million. These are separate tests, so the two amounts cannot be added together to meet the requirement.

The investment manager must be licensed by or registered with the Securities and Futures Commission (SFC) for Type 9 (asset management) regulated activity, with suitable qualifications and experience in the services and products it manages or invests in. It must also be independent of the trustee, custodians and any delegates of the custodians.

Investment management functions may be delegated to a company or corporation meeting the Mandatory Provident Fund Schemes (General) Regulation, but prior trustee approval is required. The delegate must independently meet the same independence requirements, and delegated investment activities remain subject to statutory investment restrictions. [MPFA Study Notes, section 5.7.1](https://www.mpfa.org.hk/en/-/media/files/supervision/mpf-intermediaries/registration-requirements/study_notes_10th_v1_eng.pdf)

Permissible Investments 准許投資項目

Permissible equity investments include fully paid shares on approved stock exchanges, MPFA-approved index-tracking collective investment schemes and REIT interests listed on certain approved exchanges. Other MPFA-approved listed securities include fully paid receipts or certificates, such as American Depository Receipts (ADRs) and Global Depository Receipts (GDRs), with listed underlying shares. Partly paid shares are prohibited, and collective investment scheme shares are generally excluded. Certain equity and other security holdings, and specifically permitted investments in authorized unit trusts and mutual funds, face prescribed limits.

Bank deposits must be pure deposits placed with authorized financial institutions or eligible overseas banks, within applicable percentage limits. A bank's eligibility does not allow a fund to concentrate an unlimited proportion of its assets there.

Debt securities can qualify through alternative routes: government or equivalent issuance or guarantee; the MPFA's credit rating requirements; or specified listing conditions. The listing route requires the debt to be listed on an approved exchange and the issuer's or guarantor's shares to be listed on that or another approved exchange. Convertible debt can qualify through the credit rating requirements, or through both listing on an approved exchange and conversion into shares listed on an approved exchange.

Financial futures, option contracts, warrants and currency forward contracts may be permissible, subject to the General Regulation. Inclusion of a type of instrument does not remove restrictions on its use or the amount invested. [MPFA Study Notes, section 5.7.2](https://www.mpfa.org.hk/en/-/media/files/supervision/mpf-intermediaries/registration-requirements/study_notes_10th_v1_eng.pdf)

Other Investment Restrictions 其他投資限制

The general diversification rule normally limits the combined holdings of securities and other permissible investments issued by one person to 10% of total fund assets. An employer-sponsored scheme has a separate limit: its combined holdings of shares or other securities of, or issued by, the participating employer or its associates must not exceed 10% of scheme assets. The first test concerns one issuer; the second aggregates the relevant employer and associate holdings.

Constituent funds and APIFs must not borrow securities. They may lend securities they hold, provided the assets lent do not exceed 10% of fund assets and all other legislative and guideline requirements are met. This securities lending limit operates separately from the single-issuer limit.

Money may be borrowed only to pay accrued benefits to or in respect of members, or to settle transactions acquiring securities or other investments. Further conditions under the General Regulation still apply. Permission to borrow for transaction settlement therefore does not provide a general power to borrow for any purpose.

A fund must not acquire securities that expose it to potentially unlimited liabilities. Assessment must cover the liabilities attached to the security, as well as its purchase price and expected return. [MPFA Study Notes, section 5.7.3](https://www.mpfa.org.hk/en/-/media/files/supervision/mpf-intermediaries/registration-requirements/study_notes_10th_v1_eng.pdf)

Hong Kong Dollar Currency Exposure 港元貨幣風險

Each MPF constituent fund must maintain at least 30% in Hong Kong dollar currency investments. A qualifying investment must both be denominated in Hong Kong dollars and have a value that is not linked to foreign currencies. An investment denominated in Hong Kong dollars but linked to a foreign currency cannot qualify merely because of its denomination.

Currency forward contracts may be used to meet this requirement, taking account of their effect on Hong Kong dollar currency exposure. For example, a fund with HK$100 million of total assets and no relevant currency forwards needs at least HK$30 million in qualifying Hong Kong dollar investments. Quoting fund unit prices in Hong Kong dollars does not itself demonstrate compliance. [MPFA Study Notes, section 5.7.4](https://www.mpfa.org.hk/en/-/media/files/supervision/mpf-intermediaries/registration-requirements/study_notes_10th_v1_eng.pdf)