Most countries, if not all, impose money laundering regulations and require registrations of financial institutions and persons wishing to engage in money service business, such as currency exchange or remittance services. In the United States, for example, Bank Secrecy Act requires every money service business to register with the U.S. Department of the Treasury's Financial Crimes Enforcement Network.

In Hong Kong, the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO), which came into effect on April 1, 2012, governs the registration of money service businesses. Under the AMLO, any person who wishes to operate a remittance (money transfer) and/or money changing service (currency exchange) is required to apply for a license from the Hong Kong Commissioner of Customs & Excise Department (CED). Under the AMLO, operating a money service without obtaining a money service operator (MSO) license is an offence which can lead to a fine of HK$ 100,000 and imprisonment for six months.

The first step in obtaining a MSO license is completing the Application Form, known as Form 1. This form requires the applicant business to list details including particulars of the applicant's business, ultimate owners and/or directors of the applicant business, details of the bank account, and the particular premises used for the operation of a money service.

Applicants are required to submit four main types of supporting evidence at the time of submitting Form 1: (1) Supporting documents of the applicant’s particulars, such as business registration certificate and certificate of incorporation; (2) supporting documents of particulars of each premises, such as a tenancy agreement and floor plan; (3) supporting documents of particulars of individual partner, director or owners of the applicant business, known as Fit and Proper Person Declaration Forms; and (4) authorization letter signed by all partners or board of directors authorizing the application.

In addition to the four main types of supporting documents, the applicant may be asked to submit other supporting evidence not listed on the application form, such as a business plan. It should also be noted that applicants who wish to operate the money service online may not be required to submit supporting documents of particular premises used for the operator of money service.  

Once the application form and supporting documents are submitted, the director or owner of the applicant business will be interviewed by authorized officers at the CED headquarter in Hong Kong. The CED officers may also conduct an on-site inspection at the premises provided in the application form prior to granting the MSO license. If the MSO license is granted, relevant records will be kept by the CED and licensed MSOs will be updated on CED's website. A list of currently licensed MSOs can be found online here: https://eservices.customs.gov.hk/MSOS/wsrh/001s1.

Anderson & Anderson LLP has experience in applying for a Hong Kong MSO license. Please contact us if you have questions about the licensing system and procedure.