Money Service Operator (MSO) Licence

The Anti-Money Laundering and Counter-Terrorist Financing Ordinance (the AMLO), Chapter 615 of the Laws of Hong Kong, indicated the Hong Kong Customs and Excise Department (the Customs) is authorized for regulating money service operators (MSO) from 1 April 2012 onwards.

The execution of money services have to be licensed with the Commissioner of Customs and Excise, applying to any person or institution.

Alles offers extensive services for the application of Money Service Operator (MSO) Licence, including reviewing backgrounds of applicants, providing assistance throughout different stages of application, and giving post-licensing advisory services.

Business Scope

For Money Changing Service:

Money Changing Service refers to services for exchange of currencies which is operating as a business in Hong Kong. However, services that are incidental to the main business are not included, such as retail businesses accepting foreign currencies in transactions or that are operated by a person who manages a hotel if the service —

1. is performed within the premises of the hotel mainly for the convenience of the hotel guests
2. only includes transactions for the purchase by that person of non‐Hong Kong currencies in exchange for Hong Kong currency

For Remittance Service:

Remittance Service refers to services of one or more of the following that is operated as a business in Hong Kong —

1. sending, or arranging for the sending of, money to a place outside Hong Kong
2. receiving, or arranging for the receipt of, money from a place outside Hong Kong
3. arranging for the receipt of money in a place outside Hong Kong

Licence Eligibility

1. "Fit and Proper Person" includes Partner/ Ultimate Owner and Corporate Director (For more details: refer to 'Definition of "Fit and Proper Person"' section below)
2. Appoint a Compliance Officer (CO) and a Money Laundering Reporting Officer (MLRO) (applicable since November 2018)
   • Requirement: CO and MLRO should always be stationed in Hong Kong
3. Particular Premises used for operating a Money Service, such as commercial offices, retail shops, or residence
   • A copy of stamped tenancy agreement or a record of ownership of the premises should be provided
   • A floor plan of the premises should be provided
4. Bank Account(s) used for operating the Applicant’s Money Service:
   • Details such as Name of Account Holder and Name of Bank and Account Number should be included

Scope of Services Provided by Alles

1. Consultation services
2. Evaluation of applicant(s)’ backgrounds concerning “Fit and Proper” Person(s)
3. Compliance advisory recommendations for customer due diligence, record-keeping obligations, as well as other licensing requirements
4. Preparation and submission of MSO licencing application documents, which include forms, supplementary documents, and business plans to the Hong Kong Customs and Excise Department (the Customs)
5. Handling preliminary enquiries from the Customs for MSO licence applications
6. Meetings arrangements with C&ED officers
7. Arrange and accompany the “Authorized Person(s)” for having face-to-face meeting with the Customs
8. Arrange on-site visits at the Particular Premises with the Customs and the “Authorized Person(s)”
9. Communication and follow-ups with the Customs on the MSO licence until the Customs approves the application;

Other Services Provided by Alles

1. Assistance for registration of a Hong Kong Company
2. Assistance for opening a business bank account

Application Procedures at the Customs

1. Submission of the MSO Licence Application to the Customs by the applicant
2. An acknowledgement receipt will be issued from the Customs to the applicant
3. A notice for an interview together with a demand note for the payment of fees regarding the application will be received by the applicant
4. The original documents and the payment record will be verified during the interview. The applicant will also be asked to sign on the formal application for the grant of an MSO licence in the presence of the C&ED officers during the interview.
5. An on-site inspection at the business premises will be arranged
6. The identification information will be passed to Hong Kong Police Force and Official Receiver’s Office for background check
7. An MSO licence is granted to the applicant by the Customs

Application Procedures of MSO from Alles

1. Appoint Alles Compliance Consulting Limited (Alles) as your Consultant

↓

2. Register a Company in Hong Kong, rent a Premise, and finish decoration

       ↓ (2 weeks)

3. Alles will arrange a site visit at the Premise, offer operation advice, and review the Business Plan and AML policy

    ↓ (1 week)

4. Prepare the application form(s) and provide relevant documents

      ↓ (3 weeks)

5. Submit application documents to the Customs

         ↓ (7 working days)

6. The Customs will issue an acknowledgement receipt to the applicant. A reminder for provision of outstanding documents will also be sent to the applicant if necessary

         ↓ (2 months)

7. A notice for interview and a demand note for the payment of fees regarding the application will be received

       ↓ (2 weeks)

8. Have a preliminary meeting with the Customs (around 15 mins)

       ↓ (2 weeks)

9. The Customs will issue an invitation letter for nominating eligible persons of the applicant to attend the Competence Assessment

              ↓ (1-2 months)

10. The eligible persons of the applicant will attend the Competence Assessment

       ↓ (2 weeks)

11. The Customs will notify the results of the Competence Assessment by email

        ↓ (1 month)

12. Alles will provide training for the applicant before the meeting with the Customs

     ↓ (1 week)

13. Have a face-to-face meeting with the Customs

        ↓ (1 month)

14. The Customs will issue an email for requesting additional documents and information from the applicant

        ↓ (1 month)

15. The Customs will pass the identification information to Hong Kong Police Force and Official Receiver’s Office for background check

        ↓ (1 month)

16. The Customs will have a site visit at the applicant’s Premise

        ↓ (1 month)

17. The Customs will issue an email for requesting additional documents and information from the applicant

        ↓ (1 month)

18. MSO licence is granted to the applicant by the Customs

Approximate total time: 7-10 months

Latest update: July 2022

Definition of "Fit and Proper Person"

1. Whether the person has been convicted for an offence in Hong Kong or outside Hong Kong, except for traffic contraventions
2. Whether the person has been convicted for an offence related to money laundering or terrorist financing, or has failed to comply with any requirements imposed under the AMLO or any regulations made by the CCE under Section 51
3. Whether the person, being an individual, is an undischarged bankrupt
4. Whether the person is the subject of any bankruptcy proceedings under the Bankruptcy Ordinance, Chapter 6
5. Whether the person, being a corporation, is in liquidation or is the subject of a winding up order

Common Reasons for Being Rejected to Attain the Licence

1. The Premise are not suitable for operating a money service
2. The applicant fails to attend Competence Assessment
3. The applicant fails to pass the requirements of being “Fit and Proper”

Licensee’s Obligations

1. The individual, any partner, any director and ultimate owner in relation to a licensee must remain fit and proper at all times
2. The licensee must display the original of the licence in a conspicuous place at the specified premises
3. A licensee should comply with all the applicable provisions of the AMLO and guidelines issued by the CCE

Supplementary Information

1. The licence granted will be valid for 2 years. If the applicant wishes to continue to operate a money service, the licensee is required to apply for licence renewal 45 days before the expiry date
2. When the premises with respect of which an application is made are domestic premises, the applicant should secure the written consent of every occupant of the premises for any authorized person to enter the premises for routine inspection
3. An ultimate owner in relation to an applicant for a licence or a licensee that is a corporation, means an individual who –
   1. owns or controls, directly or indirectly , more than 25% of the issued share capital of the corporation (include through a trust or bearer share holding)
   2. directly or indirectly entitled to exercise, or control the exercise of more than 25% of the voting rights at general meetings of the corporation
   3. exercises ultimate control over the management of the corporation

Money Service Operators Licensing Guide by Customs and Excise Department: https://eservices.customs.gov.hk/MSOS/download/guideline/Licensing_Guide_en.pdf

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