MONEY CHANGES ORDINANCE

MONEY CHANGES ORDINANCE

LAWS OF HONG KONG

MONEY CHANGERS ORDINANCE

CHAPTER 34





CHAPTER 34

MONEY CHANGERS ORDINANCE

ARRANGEMENT OF SECRIONS

Section Page

1. Short title ...........................2
2. Interpretation ......................2
3. Application of Ordinance ..............3
4. Money changer to provide transaction note 3
5. Right to rescind ......................5
6. Money changer to display rates ........5

7. Exchange of other currencies .................. 5
8. Advertising rates of exchange .........6
9. Governor may amend Schedules ..........6
10. False or misleading representations .. 7

11. Criminal liability .......................................................................................................... 7
Schedule 1. Transaction note ................. 8

Schedule 2. Permitted statements ..........9
Schedule 3. Prescribed currencies .........9





CHAPTER 34

MONEY CHANGERS

To provide for the disclosure by money changers of exchange rates on exchange
transactions and for the obtaining of consent thereto.

(Amended 9 of 1989 s. 2)

[ 1 April 1985 ] L.N.57of1985

Originally 9 of 1985 R. Ed. 1985, 27 of 1986, 9 of 1989,

1. Short title

This Ordinance may be cited as the Money Changers Ordinance.

(Amended 9 of 1989 s. 3)

2. Interpretation

In this Ordinance, unless the context otherwise requires-

'board' means a device used for displaying the net rates of exchange required under
this Ordinance and includes a video display screen; (Added 9 of 1989 s.4 )

'buy' means, in relation to a Hong Kong dollar exchange transaction, to buy foreign
currency from a customer and includes an offer to buy; (Added 9 of 1989 s. 4)

'currency' includes a cheque and a traveller's cheque;

exchange transaction' means a transaction between a money changer and another
person relating to the exchange of different currencies;

'hotel' has the meaning assigned to it by section 2 of the Hotel Proprietors
Ordinance (Cap. 158);

'money changer' means a person who carries on in Hong Kong the business of
exchanging currencies, not being a business which

(a)is a service provided and operated by that person primarily for the
convenience of guests of an hotel managed by him;

(b) is carried on within the hotel premises; and

(c)consists solely of transactions for the purchase by that person of
other currencies in exchange for Hong Kong currency;

'net rate of exchange' means when a money changer buys or sells Hong Kong
dollars, the net price per unit of foreign currency, expressed in Hong Kong
dollars, that the money changer is prepared to exchange for the foreign
currency tendered or requested by the customer, after deducting all charges
and commissions; (Added 9 of 1989s.4.)





'sell' means, in relation to a Hong Kong dollar exchange transaction, to sell

foreign currency to a customer and includes an offer to sell; (Added 9 of

1989s.4)

',sign' includes to affix a chop or mark; (Added 9 of 1989s.4)
'transaction note' means a note of an exchange transaction. (Added 9 of 1989

s.4)

3. Application of Ordinance

(1) Nothing in this Ordinance shall apply to

(a) a bank licensed under the Banking Ordinance (Cap. 155); or

(b) a company licensed or registered as a deposit-taking company
under the Banking Ordinance Ordinance (Cap. 155); or (Amended 27
of 1986s.137)

(c)an exchange transaction where the amount of the currency tendered
for exchange exceeds the sum of $100,000 in Hong Kong currency or
the equivalent of such sum.

(2) The sum specified in subsection (1)(c) may be amended by the

Governor by notice in the Gazette.

4. Money changer to provide transaction note

(1) A money changer, before completing an exchange transaction by

handing any currency to a customer in exchange for currency tendered by the
customer, shall-

(a)legibly make out in duplicate a transaction note in the form prescribed
in Schedule 1, with such inclusions as are required or permitted by this
section, by correctly completing the details of the exchange
transaction by using Arabic numerals and an abbreviation commonly
used by money changers to signify the type of currency;

(b) sign the transaction note;

(c)explain, in so far as is practicable, the transaction note to the customer
and indicate each detail of the exchange transaction set out in the
transaction note; and

(d)request the customer to sign the front of the original transaction note
in the place reserved for his signature and, unless a copy of the
signature is recorded on the duplicate, to sign the front of the
duplicate transaction note in the place reserved for his signature.

(2) The details referred to in subsection (1)(a) are

(a) the date of the transaction;





(b) the type of currency tendered by the customer;

(c) the amount of currency tendered by the customer;

(d)the net rate of exchange, which shall be stated without reference to
any charge or commission;

(e)the equivalent amount of the currency to be issued to the customer;
and

(f)where more than one currency is tendered by the customer, the total
amount of the exchanged currency to be issued to the customer.

(3) A money changer shall include in the form of transaction note used by him
the money changer's name, address and telephone number both in English and
Chinese and may include in the form

(a) a serial number for the note;

(b) a transaction number;

(c)provision for evidence of the customer's identification to be recorded
and details of that evidence; and

(d) statements to the effect of the form set out in Schedule 2.

(4) A money changer shall not include in a transaction note any statement other
than a statement authorized by this Ordinance.

(5) If a money changer sells more than one type of currency to a customer, the
money changer shall issue a separate transaction note for each currency sold.

(6) A money changer shall hand over to the customer the total of the equivalent
amount of the currency shown in the transaction note as the currency to be issued
to the customer without any deduction.

(7) A money changer shall, on handing over the exchanged currency, issue the
original of a transaction note to the customer.

(8) A money changer shall retain the duplicate copy of a completed transaction
note for not less than 12 months and shall produce the duplicate for inspection and
copying on demand by a police officer.

(9) Without derogation from section 5, a customer may, at any time before the
money changer completes the transaction by complying with this section and
handing the total of the exchanged currency to the customer, refuse to proceed with
an exchange transaction.

(10) If a customer refuses to proceed with an exchange transaction under
subsection (9), the money changer shall immediately hand back to the customer the
currency tendered by the customer for the exchange transaction without any
deduction.

(11) A money changer who contravenes subsection (1), (3), (4), (5), (6), (7), (8) or
(10) or who fails to comply with a demand under subsection (8) commits an offence
and is liable to a fine of $2,000 for a first offence and to a fine of $5,000 and to
imprisonment for 6 months for a second or subsequent offence. (Replaced 9 of 1989
s. 5)





5. Right to rescind

Where a money changer contravenes section 4 in respect of an exchange
transaction the other party to the transaction may, on the ground of such
contravention and without prejudice to any other right or remedy, rescind the
transaction within 3 days after the date thereof.

(Amended 9 of 1989 s. 6)

6. Money changer to display rates

(1) If a money changer is prepared to enter into a Hong Kong dollar exchange
transaction for any of the currencies prescribed in Schedule 3, the money changer
shall maintain a board displaying the current net rate of exchange offered by him to
customers for both buying and selling the currencies.

(2) If a money changer maintains more than one board displaying net rates of
exchange, he shall display, on all of the boards, identical information relating to the
net rates of exchange displayed.

(3) A money changer shall

(a)provide a sufficiently large board to display the net rates of exchange
in a clearly visible and legible manner to the customer; and

(b)place the board in a well lit place where the customer has an
unobstructed view of the board.

(4) A money changer shall display on the board the net rate of exchange which
is least favourable to the customer and may offer a net rate of exchange that is not
shown on the board if the offered rate is more favourable to a customer.

(5) A money changer shall display on the board, and set out in any note issued
under section 7(1), the buying and selling net rates of exchange under the headings
we buy' and we sell' respectively.

(6) A money changer may display a net rate of exchange in multiple units of 10
or 100 units of foreign currency with a corresponding adjustment to the Hong Kong
dollar figure.

(7) A money changer who contravenes this section commits an offence and is
liable to a fine of $5,000 and to imprisonment for 6 months.

(Replaced 9 of 1989 s. 7)

7. Exchange of other currencies

(1) If a money changer is prepared to enter into an exchange transaction
involving a currency other than one of those set out in Schedule 3, he shall give the
potential customer a note in writing of both





(a)the net rate at which he is prepared to buy the currency nominated
by the potential customer; and

(b)the net rate at which he is prepared to sell the currency nominated by
the potential customer,

before he accepts any currency from the potential customer.

(2) The note referred to in subsection (1) is not a transaction note and the
money changer shall issue a transaction note in addition to the subsection (1) note
in an exchange transaction referred to in subsection (1).

(3) A money changer who contravenes this section commits an offence and is
liable to a fine of $5,000 and to imprisonment for 6 months.

(Added 9 of 1989 s. 8)

8. Advertising rates of exchange

(1) Where a money changer advertises the rates of exchange for any currency,
whether on a board or otherwise, the money changer shall

(a)give equal prominence to buying rates and selling rates for each
currency; and

(b)display the buying and selling rates in such a way that a potential
customer is able to compare the buying rate with the selling rate for
any currency without the need to refer to more than one board.

(2) A money changer shall not advertise
(a) that he charges a commission on an exchange transaction;

(b) that he charges no commission on an exchange transaction;

(e) that he makes any other charge on an exchange transaction; or

(d)that he does not make any other charge on an exchange transaction.

(3) A money changer who contravenes this section commits an offence and is
liable to a fine of $5,000 and to imprisonment for 6 months.

(Added 9 of 1989 s. 8)

9. Governor may amend Schedules

The Governor may amend the Schedules by notice in the Gazette

(a)to alter the form of the transaction note prescribed in Schedule 1 by
including further or different information relevant to the exchange
transaction;

(b)to add or delete information which may be included in permitted
statements prescribed in Schedule 2; and

(c)to add to or delete from the list of currencies prescribed in Schedule
3.

(Added 9 of 1989 s. 8)





10. False or misleading representations

(1) A money changer shall not make a false or a misleading statement as
to the rate of exchange offered to a customer or potential customer.
(2) A money changer shall not make a false or a misleading statement
as to-
(a) the terms of an exchange transaction; or
(b) the application of this Ordinance,
to a customer or a potential customer.
(3) A money changer who contravenes this section commits an offence
and is liable to a fine of $5,000 and to imprisonment for 6 months.
(Added 9 of 1989 s. 8)

11. Criminal liability
(1) If a person employed by a money changer does an act which would be
an offence under this Ordinance if done by a money changer, each of the
following persons is guilty of that offence as if he were a money changer who
had committed the offence and each person is liable to the penalty prescribed
for the offence-
(a) the person employed by the money changer;
(b)the money changer, unless the money changer took reasonable
steps to prevent the commission of the offence; and
(c)where the employer of the person is a corporation, each director,
manager, secretary and other similar officer of the corporation
and any person purporting to act in any of those capacities unless
he took reasonable steps to prevent the commission of the
offence.
(2) Subject to subsection (3), for the purposes of this section, a person is
deemed to be a director of a corporation if he occupies the position of a director
by whatever name he may be called or is a person in accordance with whose
directions or instructions a director of the corporation acts.
(3) A person shall not, by reason only that a director of the corporation
acts on advice given by him in a professional capacity, be taken to be a person
in accordance with whose directions or instructions a director acts.
(4) If a partner in a partnership of money changers commits an offence
under this Ordinance, each other partner shall be guilty of the offence unless he
took reasonable steps to prevent the commission of the offence.
(5) Where under this section a person employed by a money changer is
deemed to have committed an offence-
(a) his employer; and
(b)where the employer is a corporation, each director, manager,
secretary, person purporting to act as a director, manager or
secretary of the corporation,





is presumed, in the absence of evidence to the contrary, to have not taken
reasonable steps to prevent the commission of the offence.

(6) Where a money changer who is in a partnership with another money
changer commits an offence, the partner of that money changer is presumed, in the
absence of evidence to the contrary, to have not taken reasonable steps to prevent
the commission of the offence.

(Added 9 of 1989 s. 8)

SCHEDULE [s. 4(1)(a)]

TRANSACTION
NOTE



Money Changer's Name:
...................................................................................................................

Money Changer's Address:
................................................................................................................



............................................

Money Changer's Telephone No.:
.....................................................................................................

Date:
....................................................................

Net Rate of Equivalent
Currency AmountExchange Amount

Total

...................
........................................................................

Cashier's Signature Customer's Signature.

for the Money Changer.


A customer may cancel an exchange transaction within 3 days and obtain a refund of the original
currency tendered in exchange for the Equivalent Amount shown above if the money changer
fails to comply with the Money Changers Ordinance (Cap. 34).


(Added 9 of 1989 S. 8)





SCHEDULE 2 [s- 4(3)]

PERMITTED STATEMENTS

A transaction note may contain the following statements- The Money Changer accepts no responsibility for
the customer's failure to comply with any
country's currency controls.

Please cheek all money before leaving the counter.

(Added 9 of 1989 s. 8)

SCHEDULE 3 [ss. 6(1) & 7(1)]

PRESCRIBED CURRENCIES

Currencies of the following countries-
Australia
Canada
Federal Republic of Germany
France
India
Japan
Malaysia
Philippines
Singapore
South Korea
Switzerland
Taiwan
Thailand
United Kingdom
United States of America

(Added 9 of 1989 s. 8)

https://oelawhk.lib.hku.hk/items/show/2278

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