Private columbarium operators face stricter financial regulations as government tries to address Hong Kong’s shortage of urn spaces
- Owners will have to deposit 15 per cent of sales revenues in a designated bank account until all available niches are sold
- The measures are intended to protect customers in the event of columbariums going out of business
Hong Kong private columbarium operators who demand prepayments in full from customers will have to adhere to stricter financial arrangements in the interests of consumers, regulators announced on Thursday.
The statutory Private Columbaria Licensing Board said it would require operators to contribute to a rainy day trust to ensure they had sufficient cash flow to sustain operations and recurrent expenditures in the long run.
It costs only about HK$2,900 (US$370) to buy a niche at a government-run crematorium, but in space-starved Hong Kong, people have to wait more than four years for a public niche.
This mismatch between supply and demand has fuelled a fierce private market where niche placements can sell for as much as HK$300,000.
A new licensing scheme for private columbariums was put in place last year to regulate private operators and ensure better protection for consumers.