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  • Introduction
  • Transfer process
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  • Considerations
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  • Default Investment Strategy Intro
  Introduction
What is Employee Choice Arrangement?
Type of accrued benefits Before ECA After ECA
Employer mandatory contributions under current employment
 Non-Transferable
 Non-Transferable
Employee mandatory contributions under current employment
 Non-Transferable
 Transferable in a lump sum once every calendar year*
Mandatory contributions from former employment or self-employment
 Non-Transferable
 Transferable in a lump sum at any time

A “calendar year” means the period from 1 January to 31 December.
What are the objectives and the benefits of ECA?
'Employee Choice Arrangement' aims to give more discretionary power to employees in selecting MPF trustees and plans, a way that encourages employees to more actively manage their MPF investments. By gradually opening up the MPF market, market competition is promoted, which can drive MPF trustees to lower fees.
Does ECA make a change to the accounts that were created in previous jobs?
Restriction on transferring benefits under 'Employee Choice Arrangement' is only applicable to the accrued interest in the contribution accounts. After employees have transferred the accrued benefits in contribution accounts to their personal accounts, these benefits can be transferred to other MPF trustees and other plans chosen by employees anytime.

Under the 'Employee Choice Arrangement', employees can at any time transfer all the accrued benefits generated by mandatory contributions during past employed or self-employed periods previously transferred to the contribution accounts associated with their current employment to trustees and plans of their own choice.
Can employees transfer only a part of employee contribution?
No, they cannot. Under the 'Employee Choice Arrangement', employees must transfer all the accrued benefits generated by their mandatory contributions at their contribution accounts if they wish to make a transfer.

Employees can transfer all (in contribution accounts associated with current employment):

 - Accrued benefits generated by mandatory contributions of employees and/or
 - Accrued benefits generated by mandatory contributions during past employed or self-employed periods
Can employees switch the current employer’s trustee to a newly selected one?
No, they cannot. According to 'Employee Choice Arrangement', arrangement for employers' contributions remains unchanged. Employers still have to place their contributions (including employer and employee's parts) with original trustees and plans.
Will employees need to arrange the transfer of their accrued benefits via their employers for ECA?
No, they need not. Employees should submit the written notice on transfer of accrued benefits, i.e. Employee Choice Arrangement – Transfer Election Form (Form MPF(S) – P(P)), to their new trustees themselves for processing and need not arrange the transfer through their employers.
Does ECA affect self-employed persons?
No, it does not. Self-employed persons are free, as they always do, to choose their MPF trustees and plans; procedures for transferring contributions and accrued benefits remain unchanged, and so do other rights and responsibilities.
Does ECA affect employers?
'Employee Choice Arrangement' does not affect employers because:

- Transferring accrued benefits does not involve employers
- Administrative arrangements handled by employers related to MPF contributions for employees remain unchanged
- Employers' administrative arrangements on offsetting severance payments or long-service payments are unaffected

Employers have to pay attention to the following:

Employers still have to put new contributions (including employer and employee's parts) of the payroll periods thereafter into contribution accounts under the original trustees and plans instead of the MPF accounts under the trustees and plans (new trustees and new plans) selected by employees.

Employers and staff from human resources departments can:

- Provide employees with names of original trustees and plans, name of employer, and identification number of the employer to facilitate employees to fill the Transfer Election Form;
- Provide employees with contact information of original trustee and Mandatory Provident Fund Schemes Authority;
- Assist employees to understand the relevant transfer rules if their companies have voluntary contribution arrangement.
Investing and trading in stocks and other securities are very risky. AASTOCKS.com Limited encourages you to use the risk management and educational tools on this website. AASTOCKS.com Limited cannot and does not give any assurance that the present or future buy/sell commentaries and signals on this website will be profitable. AASTOCKS.com Limited cannot guarantee, and the subscriber or site visitor should not assume, that the future performance will equal past performance.
Please refer to the sponsors for further details such as the fund features and risks involved.
 
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Disclaimer
Disclaimer

The above is strictly for information purposes only and should not be considered an offer, or solicitation, to deal in any of the mentioned funds. Investment involves risk, emerging markets may have greater risk than developed markets. Subscriptions may only be made on the basis of the relevant offering documents, most recent annual financial statement and semi-annual financial statements if published thereafter. The value of investments and the income received from them (if any) may be volatile and could change substantially within a short period of time. Past performance is not a guide to future performance. The investment returns are denominated in the base currency of the fund. US dollar/ HK dollar based investors are therefore exposed to fluctuations in the US dollar/ HK dollar/ base currency exchange rate.

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