Precious Metals and Stones Registration: How to Adjust Your Business Structure without Facing Penalties
In Hong Kong, businesses involved in the trade of precious metals and stones must comply with the Anti-Money Laundering Ordinance (AMLO). As your business evolves, particularly if there are changes in your business structure, it’s essential to stay compliant with AMLO requirements.
If your business structure changes—such as converting from a sole proprietorship to a partnership, changing your Business Registration number, or altering your company’s legal structure (e.g., from a limited to an unlimited company)—you must update your PMSD registration. Failure to update your registration can lead to serious legal consequences, as your previous registration will no longer be valid.
Key Steps to Take When Changing Your Business Structure
- Notify the Customs and Excise Department (CCE)
As soon as you make any significant changes to your business structure, notify the Hong Kong Customs and Excise Department (CCE). This must be done before conducting any transactions exceeding HK$120,000, whether in cash or non-cash dealings. - Submit a New Registration Application
After notifying the CCE, submit a new PMSD registration application. Even if the change is minor or internal, the updated registration must be processed and approved before continuing any transactions.
Ensuring your registration falls under the correct category guarantees compliance with AMLO, minimizing potential legal and operational issues.
Failure to update your registration following a change in your business structure can result in:
- Fines of up to HK$100,000.
- Imprisonment for up to six months for businesses conducting transactions without proper registration.
- Loss of ability to legally conduct transactions.
By properly managing business structure changes and staying compliant with the PMSD registration process, you can avoid penalties and ensure seamless operations in the precious metals and stones trade.
