Opinion | Helping investors get redress, simply
Smyth and Ganesh of Smyth & Co consider the ramifications of Hong Kong's new Financial Dispute Resolution Scheme
Anyone (particularly insomniacs) watching a local television channel recently may have seen the public broadcast advert for Hong Kong's new Financial Dispute Resolution Centre (FDRC).
It is a one-stop shop for settling disputes between individual investors and financial institutions. It involves mediation and arbitration (med-arb). The financial institution must be regulated by the Securities & Futures Commission or Hong Kong Monetary Authority. Institutions providing credit-rating services are excluded.
It is one that, among things, stems from a financial service received by an individual or a sole proprietor that involves less than HK$500,000, including interest. The power to determine whether a claim is eligible lies with the FDRC. Its terms of reference are required reading for prospective claimants and financial institutions' in-house lawyers and compliance officers.