Hong Kong’s Private Wealth Management Association is collaborating with the Hong Kong Monetary Authority to encourage its 47 members to adhere to the regulator's "Treat Customers Fairly" Charter in order to make the industry "more competitive," according to both bodies.

The HKMA published the charter in October 2013. Like its ancestor in the UK, the charter contains some vague principles - five in all, compared with the UK's six. The 22 retail banks that signed up to the charter at that time were (and remain): Bank of China (Hong Kong) Limited; Bank of Communications Co, Ltd. Hong Kong Branch; Bank of East Asia Ltd; China CITIC Bank International Limited; China Construction Bank (Asia) Corporation Limited; Chiyu Banking Corporation Limited; Chong Hing Bank Limited; Citibank (Hong Kong) Limited; Dah Sing Bank Limited; DBS Bank (Hong Kong) Limited; Fubon Bank (Hong Kong) Limited; Hang Seng Bank Limited; the Hongkong and Shanghai Banking Corporation Limited; Industrial and Commercial Bank of China (Asia) Limited; Nanyang Commercial Bank Limited; Public Bank (Hong Kong) Limited; Shanghai Commercial Bank Limited; Standard Chartered Bank (Hong Kong) Limited; Tai Sang Bank Limited; Tai Yau Bank Limited; Wing Hang Bank Limited; and Wing Lung Bank Limited.

Principles of conduct

The UK's TCF principles, which it calls 'outcomes,' are as follows.

Outcome 1 - Consumers can be confident that they are dealing with firms where the fair treatment of customers is central to the corporate culture.
Outcome 2 - Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.
Outcome 3 - Consumers are provided with clear information and kept appropriately informed before, during and after the point of sale.
Outcome 4 - Where consumers receive advice, the advice is suitable and takes account of their circumstances.
Outcome 5 - Consumers are provided with products that perform as firms have led them to expect, and the associated service is of an acceptable standard and as they have been led to expect.
Outcome 6 - Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.

The Hong Kong charter, meanwhile, contains the following principles.

1. Banking services and products should be designed to meet the needs of customers. Banks should assess the financial capabilities and needs of customers before offering them a service, advice or product. The provision of advice or selling of financial products should take into account the interest of the customers, having regard to their profiles and the complexity of the banking services or products in question.
2. Banks should set out and explain clearly the key features, risks and terms of the products, including any fees, commissions or charges applicable to customers. Appropriate information should be provided to the customers before, during and after the point of sale.
3. All promotional materials and information designed for customers should be accurate and understandable. Misleading representations or marketing practices should be avoided.
4. Banks should provide customers with reasonable channels to submit claims, make complaints, seek redress, and should not impose unreasonable barriers on customers to switch banks.
5. Private wealth management institutions should join force with the Government, regulators and others to promote financial literacy among HNWs.

The genesis of the principles

When the charter first appeared, the HKMA said that it marked a new era for Hong Kong as Asia’s premier international financial centre in the enhancement of consumer protection in the financial realm. When it explained the charter's background, it did not mention a word about the British TCF principles that date from 2006; instead, it attributes it to some principles to do with "financial consumer protection" that the 'Group of 20' industrialised nations promulgated in 2011.