MPF Employee Choice Arrangement

Employees contributing to Mandatory Provident Fund (MPF) schemes can make a once-yearly transfer of their employee’s portion of mandatory contributions and investment returns (MPF benefits) in their contribution accounts to an MPF trustee and scheme of their choice. This option, which gives employees more autonomy in handling their MPF investment, is available under the MPF Employee Choice Arrangement (ECA) which has come into effect since 1 November 2012.

For MPF benefits from former employment or self-employment in employees’ contribution accounts, employees can also transfer them to their choice of trustee and scheme. For voluntary MPF contributions, the existing governing rules of individual schemes apply. 

While the ECA gives employees a choice, it is not compulsory to make a transfer. Employees who are satisfied with the current trustee and scheme of their contribution accounts need not make any changes.

In addition, the ECA does not affect self-employed persons, who are already enrolled in an MPF trustee and scheme of their choice.

Employers’ Rights and Obligations are Unchanged with ECA

There is no change to the employers’ administrative arrangements for their employees’ MPF. An employer will continue to make contributions to the trustee(s) and scheme(s) chosen for their employees.

In addition, an employer will continue to:

• Choose and join one or more MPF trustees and schemes for their employees;
• Enrol new employees in the MPF scheme(s) that has/have been chosen; and
• Assess or review the performance of the trustee(s) and scheme(s) chosen, and if necessary, consider switching to others to cater for the needs of the company or employees.

The ECA will not affect the employers’ administrative arrangements for offsetting severance or long-service payments. The MPF benefits from the employer’s portion of contributions cannot be transferred by the employees.

How Can Employees Choose their MPF Trustee of Choice under ECA?

If you are planning to transfer the employee’s portion of MPF benefits in your contribution account to the MPF trustee and scheme of your choice, you should bear in mind the following transfer arrangements under ECA:

• A transfer is allowed once during a calendar year between 1 January and 31 December. However, after you have made a transfer, you need not wait another 12 months to make the next one – you can apply for another transfer any time during the next calendar year;
• A transfer must be made in one lump sum; and
• The employer is not required to be involved in the transfer process. An employee may contact the trustee* of his/her choice directly to arrange the transfer.

A list of MPF Approved Trustees is available online.

Before making a transfer, remember the following:

• It is not compulsory to make a transfer: The ECA gives employees a choice. It is not compulsory to change your MPF trustee and scheme, if you are already satisfied with the performance and services of your current trustee.
• Take your time to evaluate and select a suitable MPF trustee: Consider four major factors before choosing an MPF trustee/scheme. They are:
  1. Products (scheme and fund): Consider whether the fund choices available are adequate and meet your needs;
  2. Services: Compare the range and quality of services offered by trustees;
  3. Fees and charges: Compare fees and charges of funds of the same type; and
  4. Personal factors: For example, your personal investment objectives; current life stage (including number of years before retirement); and risk tolerance level and other savings for retirement.

Three major steps to complete a transfer:

1. Complete and submit the Employee Choice Arrangement – Transfer Election Form 

You can download the Transfer Election Form or obtain one from any MPF Approved Trustee*.

2. Trustees buy/sell fund units

There is a process before a transfer is completed, which includes the verification of the information received by both the original and new trustees, before the new one can receive your contributions for investment.

You should note that after the original trustee has redeemed the funds and before the new trustee subscribes new funds, there will generally be a time-lag of about 1 to 2 weeks during which the MPF benefits will not be invested in any fund.

3. Make sure you receive the transfer documents

The original trustee will send you a Transfer Statement while the new trustee will provide a Transfer Confirmation. Check these documents and contact the respective trustee if in doubt.

* MPF trustees and their schemes will get the eMPF Platform onboard in sequence. eMPF Company will then utilize the eMPF Platform to provide scheme administrative services and handle the service instructions for employers, scheme members and self-employed persons. From then on, employers, scheme members and self-employed persons can manage MPF on the eMPF Platform directly without submitting the service instructions to MPF trustees. The eMPF Platform will provide relevant information and/or documents to you directly. Please visit eMPF website (https://www.empf.org.hk/) for obtaining the MPF scheme(s) onboarding timeline and relevant information.