CHIT-FUND BUSINESSES (PROHIBITION) ORDINANCE

CHIT-FUND BUSINESSES (PROHIBITION) ORDINANCE

LAWS OF HONG KONG

CHIT-FUND BUSINESSES (PROHIBITION)

ORDINANCE

CHAPTER 262





CHAPTER 262

CHIT-FUND BUSINESSES (PROHIBITION)

To prohibit chit-fund businesses and to make provision for other
connected purposes.

[12 May 1972.]

1. This Ordinance may be cited as the Chit-Fund Businesses
(Prohibition) Ordinance.

2. In this Ordinance, unless the context otherwise requires-

'chit-fund' means a scheme or arrangement, whether known as chit-
fund or 'hwei' or by any other name, whereby or as part of which
the participants subscribe periodically or otherwise to a common
fund and that common fund is put up for sale or payment to the
participants by auction, tender, bid, ballot or otherwise;

'operate- includes manage, form, conduct, organize, advertise and aid,
assist or take part in operating,

'Registrar' means the Registrar of Companies.

3. (1) Subject to section 5 and to subsection (2). any person who
operates a chit-fund commits an offence and is liable to a fine of $20,000
and to imprisonment for 3 years.

(2) Notwithstanding subsection (1), if an offence is committed
under this section by reason only of the breach of one or both of
paragraphs (a) and (c.) of section 5(2), the offender is liable to a fine of
$2,000 and to imprisonment for 1 year.

(Amended, 71 of 1985, s. 2)

4. [Repealed, 71 of 1985, s. 3]

5. (1) Section 3 shall not have effect-

(a)-(b) [Deleted, 71 of 1985, s. 41

(c)in respect of a chit-fund operated in accordance with
subsection (2).

(2) A chit-fund may be operated if-

(a) there are not more than 30 participants;

(b)the operator is not at the same time operating another chit-
fund;

(c)the common fund put up for sale or payment to the
participants does not exceed $20,000; and

(d)no benefit accrues to the operator other than a right to receive
the first subscription free of interest.





(3) Notwithstanding anything contained in this section any person
who advertises a chit-fund. whether in a newspaper or by any other
means, commits an offence and is liable to a fine of $20,000 and to
imprisonment for 3 years.

(4) The Legislative Council may, by resolution. amend the amount
specified in subsection (2)((,). (Added, 71 of 1985, s. 4)

(Amended, 71 of1985, s. 4)

6. A company which has as its object or as one of its objects the
operation of chit-funds shall not be registered under the Companies
Ordinance after the commencement of this Ordinance.

7. [Repealed, 71 qf 198-5, s. 51

8. [Repealed, 71 of'1985. s. 61

9. (1) If an offence under this Ordinance has been committed by a
body of persons. whether corporate or unincorporate, any person who
was, at the time of the offence. a director, partner. member, manager.
secretary or principal officer of or employed by such body, or who was
purporting to act in any such capacity. shall be guilty of a like offence.

(2) Where any person referred to in subsection (1) is charged with
an offence under this Ordinance. it shall he a defence for bin, to prove
that the offence was committed without his consent or connivance, and
that he exercised such diligence to prevent the commission of the
offence as he ought to have exercised having regard to the nature of his
functions and to all other circumstances.

(3) Where the agent or servant of a person (hereinafter referred to
in this section as'the principsl' does or omits to do anything which. if
done or omitted to be done by the principal. would constitute an offence
under this Ordinance. then the agent or servant and the principal shall
be deemed to have committed an offence and shall be liable to be
proceeded against and punished accordingly.

(4) Where the principal is charged with an offence under this
Ordinance, it shall be a defence for him to prove

(a)that he did not ratify the act or omission complained of; and

(b)that the act or omission was not within the ordinary scope of
the employrnent of the agent or servant,

but it shall be no defence that he had no knowledge of the act or
omission.

10. Nothing in this Ordinance shall prejudice the enforcement by
any person of any right or claim against any person ceasing to carry on
business or to operate chit-funds, by virtue of this Ordinance.
Originally 29 of 1972. 71 of 1985. Short title. Interpretation. Chit-fund business an offence. Application of section 3. Prohibition on registration of chit-fund companies. (Cap. 32.) Liability of directors, managers, etc., under section 3 and 4. Saving of rights and claims.

Originally 29 of 1972. 71 of 1985. Short title. Interpretation. Chit-fund business an offence. Application of section 3. Prohibition on registration of chit-fund companies. (Cap. 32.) Liability of directors, managers, etc., under section 3 and 4. Saving of rights and claims.

https://oelawhk.lib.hku.hk/items/show/3038

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