Dealer in Precious Metals and Stones
A dealer in precious metals and stones is an individual or entity that buys or sells precious metals, precious stones or jewelry, in the course of its business activities. They may also offer services such as appraisal, cleaning, and repair.
Articles Covered in the Regulatory Regime
The articles covered in the regulatory regime for the registration of dealers in precious metals and stones in Hong Kong are:
Precious metals: gold, silver, platinum, iridium, osmium, palladium, rhodium or ruthenium, in a manufactured or unmanufactured state;
Precious stones: diamond, sapphire, ruby, emerald, jade or pearl, whether natural or otherwise;
Precious product: any product that is composed of, or contains, precious metals or precious stones; and
Precious-asset-backed instrument: any instrument that is backed by precious metals or precious stones.
Registration for Dealers in Precious Metals and Stones
The registration for dealers in precious metals and stones in Hong Kong is handled by the Customs and Excise Department (C&ED). The registration regime came into effect on April 1, 2023.
To become a dealer in precious metals and stones in Hong Kong, you must be registered with the Customs and Excise Department (C&ED).
Two Categories of Registration
There are two categories of registration for dealers in precious metals and stones in Hong Kong:
Category A: Dealers who intend to engage in non-cash transaction(s) with total value at or above HKD120,000 in the course of business are required to register as a Category A registrant.
Category B: Dealers who do not meet the criteria for Category A registration, but who engage in any transaction(s) (whether making or receiving a payment) with total value at or above HKD120,0001 in Hong Kong are required to register as a Category B registrant.
The main difference between the two categories is that Category B registrants are subject to a fit-and-proper test, while Category A registrants are not. The fit-and-proper test is a process to assess whether a person is suitable to be a dealer in precious metals and stones. It considers factors such as the person's character, reputation, and financial standing.
To register, you will need to submit an application form and the required documentation to the C&ED. The application form can be found on the C&ED website. The required documentation includes:
A copy of your valid business registration certificate or hawker licence.
A copy of your valid passport or identity card.
A completed fit-and-proper test form (for Category B registrants only).
Once you are registered, you will be subject to the C&ED's regulations on the dealers in precious metals and stones. These regulations aim to prevent money laundering and terrorist financing.
The regulatory regime aims to prevent money laundering and terrorist financing by requiring dealers in precious metals and stones to register with the Customs and Excise Department (C&ED) and comply with certain requirements, such as:
Conducting customer due diligence (CDD) on their customers;
Keeping records of their transactions; and
Reporting suspicious transactions to the C&ED.
The registration regime applies to all dealers in precious metals and stones in Hong Kong, regardless of their size or location.
Here are some of the specific requirements that dealers in precious metals and stones in Hong Kong must comply with under the regulatory regime:
Customer due diligence (CDD): Dealers must conduct CDD on their customers to ensure that they are not involved in money laundering or terrorist financing. This includes collecting information such as the customer's identity, address, and source of funds.
Recordkeeping: Dealers must keep records of their transactions for a period of five years. This includes information such as the customer's name, address, and identification number, the type and value of the transaction, and the date and time of the transaction.
Suspicious transaction reporting: Dealers must report any suspicious transactions to the C&ED. This includes transactions that are unusual or appear to be linked to money laundering or terrorist financing.
The C&ED may inspect the records of dealers in precious metals and stones to ensure that they are complying with the regulatory regime. The C&ED may also take enforcement action against dealers who are not complying with the regime, such as issuing a warning, imposing a fine, or revoking the dealer's registration.
The certificate of registration is valid for three years in general.
Registration Fee
The registration fees for the two categories are also different. The registration fee for Category A registration is HKD1,970. The registration fee for Category B registration is HKD1,060.
For more information on the registration regime, please visit the C&ED website.
If you are interested in becoming a dealer in precious metals and stones in Hong Kong, you should contact Bestar for more information.
How Bestar can Help
Bestar is a financial services firm that specializes in providing accounting, tax, and business advisory services to businesses in Hong Kong. We can help you with the registration for dealers in precious metals and stones in Hong Kong by providing the following services:
Accounting services: Bestar can help you set up your accounting system and ensure that you are compliant with the accounting regulations in Hong Kong. We can also help you prepare your financial statements and tax returns.
Tax services: Bestar can help you understand the tax implications of registering as a dealer in precious metals and stones in Hong Kong. We can also help you prepare your tax returns and minimize your tax liability.
Business advisory services: Bestar can provide you with general business advice, such as how to manage your finances. We can also help you develop a business plan and secure financing.
If you are interested in registering as a dealer in precious metals and stones in Hong Kong, contact Bestar for more information.
Here are some of the benefits of using Bestar to help you with the registration for dealers in precious metals and stones in Hong Kong:
Expertise: Bestar has extensive experience in providing accounting, tax, and business advisory services to businesses in Hong Kong. We have a team of experts who are familiar with the regulatory requirements and the local market.
Convenience: Bestar can help you with the entire registration process, from start to finish. This can save you time and hassle.
Peace of mind: Knowing that you are getting professional help can give you peace of mind and help you avoid mistakes.
Contact us if you have other questions.
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