The Hong Kong Association Of Banks Ordinance


Published: 1997-06-30

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Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 1

Chapter: 364 THE HONG KONG ASSOCIATION OF BANKS
ORDINANCE

Gazette Number Version Date


Long title 30/06/1997


To provide for the incorporation of The Hong Kong Association of Banks, for the corporation to assume the functions
and to take over the assets and liabilities of The Exchange Banks' Association, Hong Kong and for matters
incidental thereto and connected therewith.


[12 January 1981] L.N. 9 of 1981


(Originally 76 of 1980)

Part: I PRELIMINARY 30/06/1997




Section: 1 Short title 30/06/1997


This Ordinance may be cited as The Hong Kong Association of Banks Ordinance.

Section: 2 Interpretation 30/06/1997


In this Ordinance, unless the context otherwise requires-
"Association" (公會) means The Hong Kong Association of Banks incorporated by section 3;
"business of banking" (銀行業務) means any of the activities or functions of a licensed bank;
"clearing account" (結算帳戶) means a clearing account in respect of specified Hong Kong dollar credit balances

kept and maintained by a member; (Replaced 76 of 1995 s. 2)
"Committee" (委員會) means the Committee established by section 8;
"Consultative Council" (諮詢委員會) means the Consultative Council established by section 9;
"continuing members" (永久會員) means the continuing members under section 8(1)(a);
"deposit" (存款) has the same meaning as in the Banking Ordinance (Cap 155); (Replaced 30 of 1991 s. 2)
"deposit charge" (存款收費) means a sum of money charged or levied by a member on a specified Hong Kong dollar

deposit of a customer of that member in the event of an interest charge being levied on a member's clearing
account; (Replaced 76 of 1995 s. 2)

"Disciplinary Committee" (紀律委員會) means the Disciplinary Committee appointed under section 16;
"Exchange Banks' Association" (外匯銀行公會) means the unincorporated body known as The Exchange Banks'

Association, Hong Kong existing immediately before the commencement of this Ordinance;
"Exchange Fund" (外匯基金) means the fund of that name established under section 3(1) of the Exchange Fund

Ordinance (Cap 66); (Added 30 of 1991 s. 2)
"interest charge" (利息收費) means a sum of money charged or levied on a member's clearing account; (Replaced

76 of 1995 s. 2)
"licensed bank" (持牌銀行) means a bank within the meaning of section 2 of the Banking Ordinance (Cap 155);

(Replaced 49 of 1995 s. 53)
"member" (會員) means a member of the Association;
"Monetary Authority" (金融管理專員) means the Monetary Authority appointed under section 5A of the Exchange

Fund Ordinance (Cap 66); (Added 76 of 1995 s. 2)
"Secretary" (秘書) means the secretary of the Association appointed pursuant to section 13.

(Amended 76 of 1995 s. 2)




Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 2

Part: II INCORPORATION, OBJECTS AND POWERS 30/06/1997




Section: 3 Incorporation of Association 30/06/1997


(1) There is hereby established a body corporate to be known as The Hong Kong Association of Banks.
(2) The Association shall have perpetual succession and shall be capable of suing and being sued and of doing

and suffering all such other acts or things as bodies corporate may lawfully do and suffer.
(3) The Association shall have a common seal which shall not be affixed except pursuant to a resolution of the

Committee (or of a sealing subcommittee appointed by the Committee for that purpose) and in the presence of 2
members of the Committee and of the Secretary, or some other person appointed in his place by the Committee, each
of whom shall sign his name.

(4) Any document purporting to be a document duly executed under the seal of the Association authenticated in
accordance with subsection (3) shall be received in evidence and shall, until the contrary is proved, be deemed to be a
document so executed.

Section: 4 Objects of the Association 30/06/1997


The objects of the Association shall be-
(a) to further the interests of licensed banks;
(b) to make rules from time to time for the conduct of the business of banking;
(c) to consider, investigate and inquire into all matters and questions connected with or relating to the

business of banking;
(d) to promote, consider, support, oppose, make representations as to and generally deal with any law

affecting or likely to affect the business of banking;
(e) to collect, circulate and disseminate information relating to the business of banking or otherwise likely

to be of interest to members and others;
(f) to represent its members at and appear before any public body, committee or inquiry or before any

court or tribunal;
(g) to act as an advisory body to its members and to co-operate and maintain relations with other bodies

and organizations in all matters touching or concerning the business of banking;
(h) to provide a meeting place or places for its members and to adopt such means of publicizing or making

known its activities and information and opinions on matters touching or concerning the business of
banking as may be thought fit;

(i) to provide or procure, by means of a management agreement or otherwise, facilities for the clearing of
cheques and other instruments, and for the processing of banking transactions presented by members;

(j) to establish, subsidize, support, co-operate with or otherwise assist any person engaged in any artistic,
cultural, benevolent, charitable, welfare or similar activity and to contribute money for and to take part
in any such activities as the Committee may think fit;

(k) to do or cause to be done all such other acts and things as may conduce to the progress, prosperity and
advancement of the general body of members.


Section: 5 Powers of the Association 30/06/1997


The Association shall have power to do all such things as are necessary for, or incidental to or conducive to, the
carrying out of the objects of the Association and may in particular, but without prejudice to the generality of the
foregoing-

(a) acquire, take on lease, purchase, hold and enjoy any property, and sell, let or otherwise dispose of the
same;

(b) enter into any contract;
(c) invest funds in securities, place funds on deposit and otherwise deal with its funds in such manner as it

may think fit, and realize the same at such times as it may consider necessary;
(d) borrow or otherwise raise money on such security as may be necessary, and for that purpose charge all

or any part of the property of the Association;



Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 3

(e) act as trustee in relation to pension and retirement schemes for its employees and funds for
scholarships and prizes;

(f) institute, conduct, defend, compound or abandon any legal proceedings by or against it or otherwise
concerning its affairs;

(g) refer any claim or demand by or against it to arbitration;
(h) make and give receipts, releases and other discharges for money payable to and for claims and

demands of the Association;
(i) publish periodicals, booklets or other written material and produce or sponsor the production of

documentary films or audio-visual material, and distribute the same by sale, loan, hire or otherwise,
with or without charge, as it shall think fit;

(j) accept gifts, donations or testamentary dispositions upon such conditions as it shall determine.

Section: 6 Bylaws 30/06/1997


(1) The Association may, under its common seal, make such bylaws not inconsistent with this Ordinance as are
necessary for, or incidental to or conducive to, the carrying out of the objects of the Association and may in particular,
but without prejudice to the generality of the foregoing, make bylaws for-

(a) meetings of the Association and the procedure at and the conduct of such meetings;
(b) meetings of the Committee and its subcommittees and the procedure at and conduct of such meetings;
(c) the procedure for election of members of the Committee as provided in section 8(1)(b);
(d) the procedure for election of members of the Consultative Council as provided in section 9(1)(b);
(e) entrance fees and subscriptions for membership of the Association;
(f) control of funds of the Association;
(g) the keeping of proper accounts of the Association and records in relation thereto and the preparation of

annual accounts;
(h) the appointment of auditors and the audit of the accounts of the Association;
(i) the enforcement of the provisions of section 21(4) or of any bylaws made hereunder.

(2) (a) A bylaw under subsection (1) may be made only by an affirmative vote of not less than two-thirds of
the members present and voting at a meeting of the Association convened for that purpose and notified
in accordance with paragraph (b).

(b) Notice of such meeting and of the resolutions to be proposed thereat shall be delivered, or sent by
registered post or recorded delivery, to every member at its registered office or principal place of
business in Hong Kong not less than 21 days before the date fixed for the meeting, but the non-receipt
of such a notice by any member shall not invalidate the proceedings thereat.

(3) Bylaws made under subsection (1)-
(a) shall be subject to, and shall not derogate from, any other law;
(b) shall be subject to the approval of the Monetary Authority. (Amended 76 of 1995 s. 3)


Part: III MEMBERSHIP OF THE ASSOCIATION, COMMITTEE

AND CONSULTATIVE COUNCIL
30/06/1997





Section: 7 Membership of Association 30/06/1997


(1) Every licensed bank which is so required by a condition attached to its authorization shall become a
member of the Association and shall, subject to this section, remain a member of the Association unless expelled
under section 21(1)(d); and membership of the Association shall be restricted to licensed banks. (Amended 49 of
1995 s. 53)

(2) A member which ceases to be a licensed bank shall ipso facto cease to be a member of the Association.
(3) A member shall not be expelled from membership of the Association without the prior approval of the

Monetary Authority. (Amended 76 of 1995 s. 4)




Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 4

Section: 8 Committee 14 of 2003 09/05/2003


(1) There shall be a Committee of the Association which shall comprise-
(a) the continuing members which shall be the note-issuing bank as defined in section 2 of the Legal

Tender Notes Issue Ordinance (Cap 65); (Replaced 76 of 1995 s. 5. Amended 14 of 2003 s. 24)
(b) 9 elected members which shall be elected in accordance with the bylaws of the Association and which

shall be, and be elected,-
(i) as to 4 members, by those members whose place of incorporation is Hong Kong; (Amended 27

of 1986 s. 137; 43 of 1990 s. 16)
(ii) as to 5 members, by those members whose place of incorporation is outside Hong Kong.

(2) (Repealed 76 of 1995 s. 5)
(3) Any member of the Committee which ceases for any reason to be a member of the Association shall ipso

facto cease to be a member of the Committee.
(4) (a) There shall be a Chairman and Vice-Chairmen of the Committee.

(b) The office of the Chairman shall be held by each of the continuing members on rotation in the order
specified by the Committee and approved by the Monetary Authority.

(c) Subject to the approval of the Monetary Authority, and with the agreement of all continuing members,
the Committee may vary the order of rotation specified in paragraph (b).

(d) All continuing members not holding the office of Chairman shall be the Vice-Chairmen. (Replaced 76
of 1995 s. 5)

(5) The period of office for the Chairman shall be 1 year. (Replaced 76 of 1995 s. 5)

Section: 9 Consultative Council 30/06/1997


(1) There shall be a Consultative Council of the Association which shall comprise-
(a) the continuing members; and
(b) the number of elected members provided for in Schedule 1 which members shall be elected in

accordance with the bylaws of the Association and which shall be, and be elected by, members
incorporated or, in the case of unincorporated members, having their principal place of business, in
various regions of the world as provided in Schedule 1.

(2) The Chairman and the Vice-Chairmen for the time being of the Committee pursuant to section 8(4) and (5)
shall ex officio be the Chairman and the Vice-Chairmen respectively of the Consultative Council.

(3) The Financial Secretary may, by order published in the Gazette, amend Schedule 1.
(4) Where Schedule 1 is amended pursuant to subsection (3) any variation in the number of elected members

required, or the regions from which such members are to be elected, shall take effect from the date of the next
following meeting to elect members of the Consultative Council. (Amended L.N. 446 of 1994)

(Amended 30 of 1991 s. 3; 76 of 1995 s. 6)

Section: 10 Designated representatives of members 30/06/1997


(1) Every member of the Association shall designate in writing in a manner acceptable to the Committee a full
time employee of that member holding a managerial post who shall, subject to subsection (2), as representative of that
member- (Amended 22 of 1982 s. 2)

(a) attend and vote at meetings;
(b) hold office;
(c) execute documents,

and otherwise act for and on behalf of the member for the purposes of this Ordinance and bylaws made hereunder.
(2) (a) If the designated representative is for any reason unable to attend any general meeting of members or

any meeting of the Disciplinary Committee or otherwise to act, the member may designate, in the
manner specified in subsection (1), an alternate representative who shall have the powers and functions
of the designated representative.

(b) A member may be represented at any meeting of the Committee or of the Consultative Council or of
any subcommittee, other than the Disciplinary Committee, by any person employed by the member in
a managerial capacity and nominated in a manner acceptable to the chairman of such meeting, and
such person may attend and vote on behalf of that member at any such meeting and shall be deemed



Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 5

for the purposes of such meeting to have the powers and functions of the designated representative.
(Replaced 22 of 1982 s. 2)

(3) Every designation may be withdrawn and replaced by a new designation in writing at any time.

Part: IV GENERAL 30/06/1997




Section: 11 Functions of the Committee 30/06/1997


(1) The management of the Association shall be vested in the Committee and all the powers of the Association
shall be vested in and exercisable by the Committee except so far as this Ordinance or any bylaws made hereunder
otherwise authorize.

(2) The Committee may appoint subcommittees for the better discharge of its functions under this Ordinance
and may delegate to any subcommittee any of its powers and functions:

Provided that the Committee shall not delegate to any subcommittee the power to impose penalties for breach of
any rule made by the Committee pursuant to section 12.

(3) The Committee may in its discretion co-opt any member of the Association to be a member of any
subcommittee other than the Disciplinary Committee.

Section: 12 Rules as to conduct of business of banking 30/06/1997


(1) The Committee may, after such consultation with the Financial Secretary as he shall consider appropriate,
from time to time make such rules relating to the conduct of the business of banking as do not derogate from any law
and may in particular, but without prejudice to the generality of the foregoing, make rules- (Amended L.N. 46 of
1991; L.N. 386 of 1993)

(a) as to the maximum rates of interest, return, discount or other benefit which may be paid or granted by
members, or by any specified category of members, in respect of-
(i) specified Hong Kong dollar deposits of their customers;
(ii) specified instruments;

(aa) as to the keeping and maintenance of clearing accounts in conformity with the terms and conditions
specified by the Financial Secretary under section 3A of the Exchange Fund Ordinance (Cap 66);
(Added 30 of 1991 s. 4. Amended 76 of 1995 s. 7)

(ab) as to the imposition of deposit charges, and the minimum deposit charges to be so imposed; (Added
30 of 1991 s. 4)

(ac) as to the payment of deposit charges by customers to members; (Added 30 of 1991 s. 4)
(ad) as to the imposition of interest charges, and the rates of interest charges to be so imposed; (Added 30

of 1991 s. 4)
(ae) as to the payment of interest charges by a member to the Financial Secretary for the account of the

Exchange Fund; (Replaced 76 of 1995 s. 7)
(b) as to the conduct of foreign exchange business and the minimum commissions and charges to be

applied therefor;
(c) as to the conduct of securities and safe custody business and the minimum commissions and charges to

be applied therefor;
(d) as to the minimum charges to be applied by members for the issuance of guarantees or other

documents;
(e) as to any other charges relating to the provision of any banking service, not being charges by way of

interest or return payable on loans or advances granted by members;
(f) prohibiting members from transacting any specified type of business or using any particular type of

instrument.
(1A) All amounts of interest charges paid to the Financial Secretary for the account of the Exchange Fund in

accordance with rules made under this section shall be credited to the Exchange Fund. (Added 30 of 1991 s. 4)
(2) Rules made by the Committee pursuant to subsection (1)-

(a) may be amended by the Committee at any time;
(b) shall be binding on each member upon being served on the member as provided in subsection (3);
(c) shall not be subsidiary legislation, rules, regulations or bylaws within the meaning of those words in



Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 6

the Interpretation and General Clauses Ordinance (Cap 1) including sections 20 and 34 thereof.
(3) Rules made under subsection (1) or amended under subsection (2) shall-

(a) be delivered;
(b) be sent by registered post or recorded delivery; or
(c) be sent by telex, facsimile transmission or other similar method,

to every member at its registered office or principal place of business in Hong Kong and, unless the contrary is
proved, services shall be deemed to have been effected-

(i) upon delivery;
(ii) 48 hours after the time of posting; or
(iii) immediately after the time of sending by telex, facsimile transmission or other similar method,

as the case may be. (Replaced 30 of 1991 s. 4)

Section: 13 Appointment of staff 30/06/1997


(1) The Committee shall appoint a Secretary and may appoint other officers, servants and agents at such
remuneration and upon such terms and conditions of appointment as it thinks fit.

(2) The Committee may grant, or make provision for the grant of pensions, gratuities and retirement or other
benefits to employees of the Association.

Section: 14 Function of the Consultative Council 30/06/1997


The function of the Consultative Council shall be to advise the Committee on any matter relating to the business
of banking which-

(a) is referred to it by the Committee;
(b) it chooses to consider;
(c) it is requested, by a notice in writing signed by not less than 50 members, to consider with a view to

advising the Committee.

Section: 15 Meetings of the Consultative Council 30/06/1997


(1) Meetings of the Consultative Council shall be held at such times and places as the Consultative Council or
the Chairman thereof may from time to time appoint.

(2) The following procedural provisions shall apply to every meeting of the Consultative Council-
(a) 15 members shall form a quorum;
(b) the Chairman shall preside; (Replaced 76 of 1995 s. 8)
(c) if the Chairman is absent, the Vice-Chairman who most recently held office as Chairman and who is

present at the meeting shall preside; (Added 76 of 1995 s. 8)
(d) if the Chairman and all Vice-Chairmen who have held office as Chairman are absent, then the

members present shall select a Vice-Chairman to preside; (Added 76 of 1995 s. 8)
(e) if the Chairman and all Vice-Chairmen are absent, a member selected by the members present shall

preside. (Added 76 of 1995 s. 8)
(3) Subject to subsection (2), the Consultative Council shall regulate its own procedure relating to its meeting

and the conduct thereof.
(4) The Financial Secretary may, by order published in the Gazette, amend the number provided for in

subsection (2)(a). (Amended 76 of 1995 s. 8)

Section: 15A (Repealed 76 of 1995 s. 9) 30/06/1997




Part: V DISCIPLINARY PROCEEDINGS 30/06/1997






Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 7

Section: 16 Disciplinary Committee 30/06/1997


The Committee shall-
(a) appoint from amongst its members a Disciplinary Committee of 4 members comprising the following-

(i) 2 continuing members;
(ii) 1 member whose place of incorporation is Hong Kong; (Amended 27 of 1986 s. 137; 43 of 1990

s. 16)
(iii) 1 member whose place of incorporation is outside Hong Kong; and

(b) designate one of the members of the Disciplinary Committee to be chairman thereof.

Section: 17 Disciplinary provisions 30/06/1997


(1) A complaint that a member has acted in breach of any rule relating to the conduct of the business of
banking made under section 12(1) shall be made in writing to the Chairman of the Committee who shall submit the
complaint to the Committee which may, in its discretion, refer the complaint to the Disciplinary Committee.

(2) The Committee may act on its own information in referring a complaint to the Disciplinary Committee.
(3) The Disciplinary Committee shall notify the member in respect of which a complaint is made of the nature

of the complaint and of the date, time and place fixed for a hearing of the complaint.
(4) The member in respect of which a complaint is made shall be entitled to appear at the hearing and present

its case.

Section: 18 Powers of Disciplinary Committee with regard to

obtaining evidence
30/06/1997



(1) For the purposes of the hearing of a complaint the Disciplinary Committee shall have the following powers-
(a) to take evidence on oath;
(b) to summon any employee of any member to attend the hearing to give evidence or produce any

document or other thing in his possession and to examine him as a witness;
(c) to award to a witness such expenses as, in the opinion of the Disciplinary Committee, he has incurred

by reason of his attendance.
(2) A summons to a witness shall be signed by the Chairman of the Disciplinary Committee.


Section: 19 Legal representation 30/06/1997


At the hearing of a complaint-
(a) a member selected for the purpose by the Disciplinary Committee or a solicitor or counsel on its behalf

shall present the case against the member in respect of which the complaint is made;
(b) the member in respect of which the complaint is made shall be entitled to be represented by a solicitor

or counsel.

Section: 20 Powers of Disciplinary Committee 30/06/1997


If, after due inquiry, the Disciplinary Committee is satisfied that a complaint under section 17 is proved, the
Disciplinary Committee may recommend to the Committee that it should impose or procure to be imposed on the
member in respect of which a complaint is made any of the penalties referred to in section 21:

Provided that no such recommendation shall be made by the Disciplinary Committee unless the decision to make
the recommendation is by an affirmative vote of not less than three quarters of the members of the Disciplinary
Committee present and voting at the inquiry at which such recommendation is made.

Section: 21 Disciplinary powers of the Committee 30/06/1997


(1) The Committee may, following a recommendation by the Disciplinary Committee, in its discretion impose
or procure to be imposed on a member any of the following penalties for breach of any rule made pursuant to section
12(1)- (Amended L.N. 446 of 1994)



Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 8

(a) a reprimand;
(b) after consultation with the Monetary Authority, the suspension of membership for any period not

exceeding 3 months;
(c) with the approval of the Financial Secretary, the suspension of facilities for the clearing of cheques and

other instruments of a member for any period not exceeding 3 months;
(d) with the approval of the Monetary Authority, the expulsion of a member from membership of the

Association:
Provided that any decision to impose or procure the imposition of any penalty shall be made by an affirmative

vote of not less than three quarters of the members of the Committee present and voting at the meeting at which such
decision is taken.

(2) No appeal shall lie against the decision of the Committee to impose or procure to be imposed any penalty
pursuant to subsection (1).

(3) Where a penalty is imposed pursuant to subsection (1), the Committee-
(a) may cause notice of the imposition of such penalty to be published in the Gazette;
(b) shall give written notice to the Monetary Authority of such action and the reasons therefor.

(4) Where the Committee, with the approval of the Financial Secretary, suspends or procures the suspension of
clearing facilities pursuant to subsection (1)(c) then whilst such suspension is in force no member shall act as sub-
clearer for the member whose clearing facilities have been so suspended.

(Amended 76 of 1995 s. 10)

Part: VI TRANSITIONAL 30/06/1997




Section: 22 Transfer of assets and liabilities 30/06/1997


(1) All property of whatever kind and whether movable or immovable vested in or belonging to the Exchange
Banks' Association immediately before the commencement of this Ordinance is as from such commencement
transferred to and vested in the same interest in the Association without any further assurance and the Association
shall have all powers necessary to take possession of, recover and obtain the benefit of such property.

(2) All rights, obligations and liabilities of the Exchange Banks' Association immediately before the
commencement of this Ordinance are as from such commencement the rights, obligations and liabilities of the
Association and the Association shall have all necessary powers to exercise or discharge the same.

Section: 23 Other transitional provisions 30/06/1997


(1) Every licensed bank which immediately before the commencement of this Ordinance holds office as a
member of the general committee of the Exchange Banks' Association shall, as from the commencement of this
Ordinance, be a member of the Committee of the Association for the purposes of this Ordinance until the conclusion
of the first annual general meeting of members which shall be convened as soon as practicable after the coming into
force of by-laws made under section 6(1) relating to the convening of meetings of the Association.

(2) Where anything has been commenced by or under the authority of the Exchange Banks' Association before
the commencement of this Ordinance such thing may be carried on and completed by, or under the authority of, the
Association.

Section: 24 Consequential amendment of other enactments 30/06/1997


In any enactment containing reference to the Exchange Banks' Association or the Hong Kong Exchange Banks'
Association or words to the like effect, there shall be substituted for such reference a reference to The Hong Kong
Association of Banks.

Schedule: 1 30/06/1997


[section 9]




Cap 364 - THE HONG KONG ASSOCIATION OF BANKS ORDINANCE 9

Place of incorporation or principal place of business of member Number of members of the Consultative Council to
be elected by members incorporated in or, in the
case of unincorporated members, having their
principal place of business in, that region

Belgium, Denmark, France, The Federal Republic of Germany,
Italy, The Netherlands, The Republic of Ireland, Spain, United
Kingdom

4

Austria, Norway, Sweden, Switzerland 1

India, Iran, Malaysia, Pakistan, Thailand 1

Australia, Indonesia, New Zealand, The Philippines 1

Korea, Singapore, Taiwan China 1

The People's Republic of China 2

Hong Kong 5

Japan 3

Canada, United States of America 3
____

Total number of elected members 21
====
(Replaced L.N. 132 of 1989. Amended L.N. 29 of 1991; 30 of 1991 s. 6; L.N. 7 of 1994)

Schedule: 2 (Repealed 76 of 1995 s. 11) 30/06/1997

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