Tag Archives: China

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FHB expresses deep regret over remarks misrepresenting social distancing measures

     â€‹Regarding remarks reported today (April 28) that linked the relaxation of social distancing measures by the Government based on the “vaccine bubble” with the “social credit system” in the Mainland, the Food and Health Bureau (FHB) strongly refuted and deeply regretted such misrepresentation of facts in the media report, and clarified that there is no correlation between the two.
      
     The spokesman for the FHB stressed that the relaxation of social distancing measures announced by the Government yesterday was based on the enhanced anti-epidemic capability in Hong Kong and the steady progress of the Government’s vaccination programme. In adjusting the social distancing measures, the Government has taken into account the relevant risks of infection, and the decision was supported with public health justifications, with a view to responding to the aspirations of various trades and the public to resume normal daily lives as soon as possible.
      
     Upon the increasing numbers of the vaccination uptake, Hong Kong is gradually building a protection and immunity barrier against the epidemic. Those who have been vaccinated are safeguarded to return to their normal lives under the protection of vaccines. The spokesman reiterated that the biased remarks deliberately mislead members of the public and are unfavourable at a time when the city is joining hands in fighting the epidemic. A clarification must be made to set the record straight. read more

East Asia

LCQ11: Premium payment for subsidised sale housing flats

     Following is a question by the Hon Wong Kwok-kin and a written reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (April 28):
 
Question:
 
     Under the Housing Ordinance (Cap. 283), an owner of subsidised sale housing flat must pay a premium to the Hong Kong Housing Authority (HA) for the removal of the assignment restrictions before he/she may sell, let or otherwise assign his/her flat in the open market. Subsidised sale housing flats put up for sale by the Hong Kong Housing Society (HKHS) are subject to similar assignment restrictions. Regarding the premium payment for such housing flats, will the Government inform this Council:
 
(1) of (i) the number of flats for which applications for premium assessment were received by the HA, and (ii) the average amount of premium payable for each flat, in each of the past five years; whether it knows the relevant figures of the HKHS flats; 

(2) of a breakdown of the cases mentioned in (1) by the saleable area of the flats (i.e. (i) below 21 square metres, (ii) 21 to 39.9 square metres, (iii) 40 to 59.9 square metres, and (iv) 60 square metres or above) (set out in Table 1); whether it knows the relevant figures of the HKHS flats; 

Table 1

Year (i) (ii) (iii) (iv) Total
2016          
…          
2020          
 
(3) in respect of each of the housing courts put up for sale by the HA, of the District Council district to which it belongs, the year in which it was put up for sale, and the numbers of premium-paid flats at present and in each of the past five years (set out by subsidised sale housing schemes (namely (i) the Buy or Rent Option Scheme, (ii) the Home Ownership Scheme, (iii) the Private Sector Participation Scheme, (iv) the Middle Income Housing Scheme, and (v) the Mortgage Subsidy Scheme) respectively in tables of the same format as Table 2); 

Table 2 Housing scheme
District Council district Name of housing court Year of sale Number of flats with premiums paid
Present 2016 2017 2018 2019 2020
                 
 
(4) whether it knows, in respect of each of the housing courts put up for sale by the HKHS, the District Council district to which it belongs, the year in which it was put up for sale, and the numbers of premium-paid flats currently and in each of the past five years (set out by subsidised sale housing schemes (namely (i) the Flat-for-Sale Scheme, (ii) the Subsidised Sale Flat Projects, and (iii) the Sandwich Class Housing Scheme) respectively in tables of the same format as Table 2); 

(5) as the Hong Kong Mortgage Corporation Limited has launched the Premium Loan Guarantee Scheme and the Premium Loan Insurance Scheme to assist the relevant owners in paying premiums, of the respective (i) numbers of applications received and (ii) total amounts of the loans granted, in respect of the two Schemes in each of the past five years; and 

(6) as there are views that the Government should consider (i) allowing owners of flats with premiums unpaid to pay the premiums by instalments, i.e. to determine the time and payment rate according to the market situation and their own financial means, and (ii) introducing a mechanism under which an owner may choose to adopt either the market value of his/her flat at the time when his/her relevant application is processed or that during the various instalment periods for the calculation of the premium amount for his/her flat, whether the Government has studied such proposals in depth; if so, of the details; if not, the measures in place to enhance the premium payment arrangements? 
 
Reply:
 
President,

     My reply to the question raised by the Hon Wong Kwok-kin is as follows:
 
(1) Information on premium payment of subsidised sale flats (SSFs) under the Hong Kong Housing Authority (HA) and the Hong Kong Housing Society (HKHS) in the past five years (i.e. from 2016 to 2020) is set out at Annex 1. 

(2) The HA has not kept statistics on the premium paid by saleable areas of flats. Relevant information in relation to the subsidised sale projects under the HKHS in the past five years (i.e. from 2016 to 2020) is set out at Annex 2. 

(3) The number of the HA’s SSFs with premium paid in the past five years (i.e. from 2016 to 2020) by district (Note1) is at Annex 3. As at March 2021, there were about 61 320 HA’s SSFs with premium paid, including about 58 950 Home Ownership Scheme (HOS) Flats (Note 2) and about 2 370 flats sold under the Tenants Purchase Scheme. 

(4) Information in relation to the premium payment of subsidised sale projects under the HKHS in the past five years (i.e. from 2016 to 2020) by District Council district is set out at Annex 4. 

(5) No application was received under the Premium Loan Guarantee Scheme between its launch in 2010 and termination in 2018. As regards the Premium Loan Insurance Scheme (PLIS) which was introduced in 2015 and ended in 2019, there were 12 applications involving a total amount of $10.5 million. Many PLIS applicants intended to settle the land premium in order to apply for the Reverse Mortgage Programme (RMP). As the RMP has been extended to cover subsidised sale flats since October 2016 and the borrowers are allowed to withdraw a lump-sum payout to settle the land premium, the market did not have keen demand for the PLIS. The PLIS was therefore terminated in 2019. 

(6) SSFs, such as HOS Flats, are sold to eligible persons at a price lower than the market value to assist low-to-middle income families to achieve home ownership. Based on the principles of effective and rational use of public housing resources and equity, if an SSF owner no longer wishes to reside in the flat, the owner must first pay the premium in full in order to alienate the flat in the open market. For the HA’s SSFs, rules regarding the amount of premium to be paid are prescribed in the Schedule to the Housing Ordinance or the relevant land leases. 

     Allowing owners to pay the premium by instalments is not in line with the principles of effective and rational use of public housing resources and equity, and may also indirectly stimulate speculative activities. If SSF owners are in need of financial assistance when they pay the premium, they may consider making financial arrangements through financial institutions, or choose to sell their flats in the HOS Secondary Market with premium unpaid.
 
Note 1: The HA does not maintain statistics on SSFs with premium paid by District Council districts, different sale schemes or individual SSF projects.

Note 2: HOS Flats means flats sold under the Home Ownership Scheme, the Private Sector Participation Scheme, the Buy or Rent Option Scheme, the Mortgage Subsidy Scheme, the Middle Income Housing Scheme and the Green Form Subsidised Home Ownership Scheme. read more

East Asia

LCQ6: The purchase of properties outside Hong Kong

     Following is a question by Hon Cheung Kwok-kwan and a written reply by the Secretary for Transport and Housing, Mr Frank Chan Fan, in the Legislative Council today (April 28):
 
Question:
 
     It has been reported that Hong Kong people purchasing properties outside Hong Kong (in countries such as the United Kingdom, Australia, Canada and Thailand) has become a common phenomenon in recent years. Last year, the Estate Agents Authority received 66 complaints about the sale of properties outside Hong Kong, which is a tenfold surge from the six complaints received in the year before last. On protecting Hong Kong people who purchase properties outside Hong Kong, will the Government inform this Council:
 
(1) of the number of complaints, received by the authorities in each of the past five years, about uncompleted properties which had become default property developments in the end, and the total amount of losses involved, with a breakdown by the country/region in which such properties were located;
 
(2) whether it will consider afresh enacting legislation to regulate the practices of selling in Hong Kong properties outside Hong Kong (including the contents of advertisements), and to prohibit persons who are neither licensed estate agents nor licensed salespersons from engaging in estate agency work for properties outside Hong Kong;
 
(3) as there has been an upward trend of complaints about purchases of properties outside Hong Kong in recent years, whether the authorities will consider establishing communication and co-operation mechanisms with the relevant regulatory authorities in those countries/regions in which the properties are hot commodities for Hong Kong people, so as to protect the rights and interests of Hong Kong people who have purchased properties therein; and
 
(4) whether the authorities will step up publicity efforts to remind members of the public about matters requiring attention and common traps to avoid when they purchase properties outside Hong Kong, so as to avoid falling prey to frauds?

Reply:
 
President,
 
     Having consulted the Commerce and Economic Development Bureau, the Constitutional and Mainland Affairs Bureau (CMAB), the Financial Services and the Treasury Bureau, the Security Bureau and the Estate Agents Authority (EAA), the consolidated reply to the question raised by the Hon Cheung Kwok-kwan is set out below:

(1) For complaints received by Government departments/organisations which involved properties outside Hong Kong, there is no classification on whether the properties concerned were not completed on schedule (or referred to as “default property developments”). As regards the number of complaints received by departments/organisations which involved uncompleted properties outside Hong Kong in the past five years, the breakdown by year is shown at Annex. Since the complainants could lodge complaints to different departments/organisations and the departments/organisations could refer individual case(s) to another department/organisation, the complaints or cases received by different departments/organisations may involve the same cases.

(2) Regarding the engagement in estate agency work involving properties situated outside Hong Kong, pursuant to the Estate Agents (Exemption from Licensing) Order (Cap. 511B), a person shall be exempted from the requirement for obtaining an estate agent’s licence if he/she handles exclusively properties outside Hong Kong; and states in all his/her documents (including pamphlets and brochures, etc.) and advertisement that he/she is not licensed to deal with any property situated in Hong Kong. However, if the company or individual concerned performs estate agency work for properties both within Hong Kong and outside Hong Kong, that company/individual is required to obtain a licence issued by the EAA and be regulated by the EAA. If a licensed estate agent/salesperson is suspected of breaching the Code of Ethics and practice circulars issued by the EAA in the course of the sale of properties, regardless of whether the properties concerned are Hong Kong properties or not, the EAA will investigate the matter.

     In December 2017, the EAA issued a practice circular to provide guidelines on the appropriate practices and measures to be adopted in handling the sale of uncompleted properties situated outside Hong Kong for estate agent licensees to comply with. These practices and measures include, amongst others, due diligence measures and requirement on providing important sales documents. The guidelines have taken effect since April 1, 2018. Licensees who breach the guidelines may be subject to disciplinary actions from the EAA.
 
     There are likely substantial differences between the sale of properties situated outside Hong Kong and those in Hong Kong from the perspectives of market operation and conduct regulation. Moreover, the sale of properties situated outside Hong Kong involves laws and regulations as well as tax regimes of different jurisdictions, and also various stakeholders (e.g. non-local developers, intermediaries and agents). Furthermore, vendors of non-local properties can easily conduct sales and promotion activities through the internet, which is very difficult to regulate. It has been a more effective approach for the EAA to educate the consumers through various channels and continue to enhance public education by reminding consumers the issues that they should pay attention to before deciding to purchase non-local properties.
 
     Regarding the regulation of practices (including advertising content) for the sale of non-local properties in Hong Kong, according to the relevant codes of practice on advertising standards issued by the Communications Authority, all advertisements on television and radio are required to be legal, clean, honest and truthful. For advertisements of real properties outside Hong Kong, the codes of practice require the broadcasting licensees to seek certain substantiation information from the advertisers, unless the advertiser is an estate agent licensed under the Estate Agents Ordinance (Cap. 511). The codes of practice further require such advertisements to carry an advisory message reminding the audience to obtain and review all relevant information relating to the real properties before making any purchase decisions and seek professional advice if in doubt.
 
(3) & (4) The EAA has from time to time reminded investors and the public the risks and points-to-note before deciding to purchase properties situated outside Hong Kong (especially those uncompleted ones) through articles in newspapers and other media, educational booklets and public seminars, etc. The EAA also set up a designated section about purchasing properties located outside Hong Kong under its consumer education website and published a new educational booklet entitled “Purchasing Non-local Properties Be SMART” in early 2020, reminding consumers about the risks of purchasing properties situated outside Hong Kong. The EAA also rolled out its online promotion campaign to attract the public to visit its consumer education website and read the booklet.
 
     Apart from organising two large-scale public seminars on purchasing non-local properties, the EAA also held two online seminars in 2020 and 2021 respectively, which generated over 80 000 views of the online seminar video. Besides, the practice circular issued to licensees as mentioned in Part (2) of this reply is not only binding on the licensed estate agents, but also provides a reference for consumers to assess whether the sales arrangements adopted by individual persons (including the exempted persons) are appropriate.
 
     Moreover, the Consumer Council has from time to time published articles in its publications to remind the public of the risks involved in the purchase of properties outside Hong Kong, for example, by extracting actual complaint cases relating to the purchase of properties outside Hong Kong in the “CHOICE” magazine.
 
     Besides, the Securities and Futures Commission (SFC) updated in 2016 its FAQs in relation to the Securities and Futures Ordinance to provide guidance on collective investment schemes involving real estate interests. Furthermore, the SFC and its subsidiary, the Investor and Financial Education Council (IFEC), have issued educational materials on overseas property investment and reminded the public of the potential risks involved through various channels (e.g. IFEC’s educational website “The Chin family”, social media, newspaper and seminars) from time to time. The SFC and the IFEC will continue to enhance investor education on this front.
 
     Apart from the above, one of the main functions of the five Mainland Offices of the Hong Kong Special Administrative Region Government (namely the Beijing Office and the Hong Kong Economic and Trade Offices in Guangdong, Chengdu, Shanghai and Wuhan) is to provide assistance to Hong Kong residents in distress in the Mainland. If the Hong Kong residents seeking assistance wish to make complaints or appeals to the Mainland authorities as regards properties in the Mainland, the Mainland Offices will refer their cases to the relevant Mainland authorities on request. Besides, the Hong Kong Economic and Trade Office in Guangdong has commissioned an organisation to provide free legal advisory service to Hong Kong residents in need through a telephone hotline or by arranging Mainland duty lawyers to meet the assistance seekers to provide preliminary advice on Mainland related legal matters.
 
     To enhance the public’s understanding of matters related to property purchase in the Mainland, the Mainland Offices published the Practical Guide for Hong Kong Residents Living in the Mainland, a booklet on living in the Mainland covering practical information about property purchase such as points to note for entering contracts on sale and purchase. A link to the webpage of the EAA containing practical information on the purchase of property outside Hong Kong has been provided on the websites of the Mainland Offices to facilitate access by citizens. The CMAB has also published an article in the “CHOICE” magazine of the Consumer Council in February 2021 to remind citizens of the points to note when purchasing property in the Mainland. The web link of the article has been added to the websites of the Mainland Offices. read more

East Asia