Exchange Fund Investment (EFI) has resolved its dispute with brokers on the commission structure for the Tracker Fund which is to be launched on Monday.
Brokers had warned they would not promote the fund unless they received a higher commission.
The Hong Kong Stockbrokers Association (HKSA) yesterday announced the Government had agreed to a new arrangement in which the stock exchange's 500 brokers would receive a 1.5 per cent commission on their fund sales.
Under the original commission structure, only 16 designated retail brokers were to receive a 1.75 per cent commission to be paid by the Government. Other brokers were to be paid an undefined cash rebate from one of the 16 brokers in addition to a 1 per cent commission to be paid by their clients.
Brokers said the new commission structure would encourage them to promote the fund.
'The new arrangement would ensure a smooth start-up for the launch of the fund,' one broker said.
'I think this is a fair solution.' The HKSA last week complained to EFI and the Hong Kong Monetary Authority that the commission structure was unacceptable and unfair.
