The Government Property Agency is inviting tenders for a three-year tenancy of government properties at China Hong Kong City, China Ferry Terminal, 33 Canton Road, Tsim Sha Tsui, and the Hong Kong-Macau Ferry Terminal, Sheung Wan.

     The properties should be used for general retail purposes only (including storage, sale and display of duty-free liquor, cigarettes, cigars and other tobacco products but excluding any goods or commodities that are prohibited under the Import and Export Ordinance (Cap. 60), any regulations made thereunder and any amending legislations).

     The tender notice was uploaded today (May 18) to the Agency's website: www.gpa.gov.hk. Tender documents are available for collection at the Government Property Agency, 31/F, Revenue Tower, 5 Gloucester Road, Wan Chai, during office hours (8.30am to 5.45pm from Mondays to Fridays). The documents can also be downloaded from the Agency's website.
      
     Interested tenderers who wish to inspect the sites should make prior appointment with the Government Property Agency by calling 2594 7697 on or before May 25.

     Tenderers must submit their tenders by placing them in the Government Logistics Department Tender Box at G/F, North Point Government Offices, 333 Java Road, North Point, before noon on June 8, 2018. Late tenders will not be accepted.
 

     The Government proposes to make a new regulation under the Merchant Shipping (Prevention and Control of Pollution) Ordinance to incorporate the latest requirements of the International Convention for the Control and Management of Ships' Ballast Water and Sediments of the International Maritime Organization (IMO) into local legislation.
 
​     The new Merchant Shipping (Control of Ballast Water and Sediments) Regulation seeks to implement the latest requirements of the Convention to regulate the discharge of ballast water of ships by establishing standards and procedures for the management and control of ships' ballast water and sediments.
 
​     A spokesman for the Transport and Housing Bureau said today (May 18), "Major requirements of the Convention include requiring ships to conduct ballast water exchange before discharge, as well as to keep a ballast water management plan and a ballast water record book on board. The requirements will apply to all ocean-going vessels (OGVs) registered in Hong Kong and all OGVs within Hong Kong waters."
 
​     The Legislative Council Panel on Economic Development and the relevant consultative committee of the Marine Department have been consulted. Members supported the legislative proposal.
 
​     The legislative proposal was gazetted today and will be tabled at the Legislative Council on May 23 for negative vetting.

     The Government and the Securities and Futures Commission (SFC) published in the Gazette today (May 18) three pieces of subsidiary legislation to enable the implementation of the open-ended fund company (OFC) regime. The three pieces of subsidiary legislation are:

(a) the Securities and Futures (Amendment) Ordinance 2016 (Commencement) Notice (the Commencement Notice);
(b) the Securities and Futures (Open-ended Fund Companies) Rules (the OFC Rules); and
(c) the Securities and Futures (Open-ended Fund Companies) (Fees) Regulation (the Fees Regulation).

     The Commencement Notice will bring into effect all provisions in the Securities and Futures (Amendment) Ordinance 2016 from July 30, 2018, onwards and the OFC regime will commence on that day. The detailed statutory operational requirements of the regime, including matters related to an OFC's formation, incorporation and maintenance, appointment and cessation of appointment of the key operators, corporate filings, segregated liability of sub-funds (if any), winding-up and offences, will be set out in the OFC Rules. The fees to be collected by the SFC and the Registrar of Companies in respect of OFCs will be set out in the Fees Regulation.

     The Inland Revenue (Amendment) (No. 2) Ordinance 2018, which extends profits tax exemption to onshore privately offered OFCs, will also take effect on July 30, 2018.

     "With the commencement of the OFC regime, fund managers will have the option of setting up a fund in the form of a company, in addition to the form of a unit trust. This additional choice should help diversify Hong Kong's fund domiciliation platform and build up our fund manufacturing capabilities. This will in turn help further develop Hong Kong's asset management industry," a government spokesperson said.

     An OFC is a collective investment scheme with variable capital set up in the form of a company, but with the flexibility to create and cancel shares for investors' subscription and redemption in the fund. Also, an OFC will not be bound by restrictions on distribution out of capital applicable to a conventional company, and instead may distribute out of capital subject to solvency and disclosure requirements. The SFC will be the primary regulator responsible for the registration and regulation of OFCs under the Securities and Futures Ordinance (Cap. 571). The Companies Registry will oversee the incorporation and statutory corporate filings of OFCs and the Official Receiver's Office the winding-up procedure. 

     The three pieces of subsidiary legislation will be tabled before the Legislative Council on May 23, 2018, for negative vetting.

     An order made by the Chief Executive in Council under the Inland Revenue Ordinance (Cap. 112) to implement the Comprehensive Avoidance of Double Taxation Agreement (CDTA) with Saudi Arabia was gazetted today (May 18).

     "The CDTA with Saudi Arabia ensures that investors will not have to pay tax twice on a single source of income. This CDTA will bring tax savings and a greater certainty on taxation liabilities for investors from Saudi Arabia when they engage in trade and investment activities with Hong Kong and vice versa," a Government spokesman said.

     Highlights of the CDTA with Saudi Arabia are set out in the Annex.

     The order will be tabled at the Legislative Council on May 23 for negative vetting. The CDTA will enter into force after both Hong Kong and Saudi Arabia have completed their ratification procedures.

     Hong Kong signed the CDTA with Saudi Arabia in August 2017.

     The Banking (Amendment) Ordinance 2018 (Commencement) Notice 2018 and the Banking (Exposure Limits) Rules were gazetted today (May 18) to modernise section 87 of the Banking Ordinance in relation to a prescribed limit on equity exposures incurred by authorised institutions.

     Enacted by the Legislative Council in January 2018, the Banking (Amendment) Ordinance seeks to incorporate into local legislation the latest standards promulgated by the Basel Committee on Banking Supervision in relation to concentration of financial exposures of authorised institutions, by empowering the Monetary Authority to prescribe rules on financial exposure limits.

     The Banking (Exposure Limits) Rules modernise section 87 of the Banking Ordinance by capturing equity exposures more comprehensively and recognising certain risk mitigation techniques commonly used in the industry in measuring equity exposures. The relevant provisions in the Banking (Amendment) Ordinance 2018 will have to commence operation to allow new rules to be made to replace section 87 of the Banking Ordinance.

     A government spokesman said, "The Banking (Exposure Limits) Rules introduce a more flexible equity exposure limit which could enhance the resilience of the banking system and at the same time ensure competitiveness of the banking industry in Hong Kong. This is important to Hong Kong as a major international financial centre."

     A Hong Kong Monetary Authority spokesman said, "Guided by the international principles on the supervision of a bank's concentration risk, we have made the Banking (Exposure Limits) Rules to bring up to date the provisions for regulating authorised institutions' equity exposure. We have closely engaged the banking industry in the making of the Rules to make sure that the Rules reflect the latest market developments and risk management practices of the industry."

     The Commencement Notice and the Banking (Exposure Limits) Rules will be tabled before the Legislative Council at its sitting on May 23, 2018 (Wednesday) for negative vetting, and will come into operation on July 13, 2018.