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Employees Compensation Assistance (Amendment) Ordinance 2002

The Employees Compensation Assistance (Amendment) Ordinance 2002 (the Amendment Ordinance) was passed by the Legislative Council on 26 June 2002. Save for the provisions relating to insurer insolvency, the Amendment Ordinance came into operation on 1 July 2002.

The Amendment Ordinance seeks to implement a package of measures to reform the Employees Compensation Assistance Scheme with a view to restoring its long term financial viability. Major amendments are:

• To introduce a relief payment in lieu of the assistance on common law damages;
  
• To empower the Employees Compensation Assistance Fund Board (the Board) to take part in the legal proceedings to defend the claims;
  
• To revise the procedures for filing applications to the Board, such as requiring potential applicants to serve a notice of proceedings to the Board;
  
• To require an employer who fails to take out employees' compensation insurance policy to pay a surcharge to the Board; and
  
• To increase the overall levy rate imposed on the employees' compensation insurance premium from 5.3% to 6.3% for the benefit of the Board.

The Amendment Ordinance also includes amendments to repeal the provisions relating to insurer insolvency. However, these amendments will not come into operation until and unless a separate scheme is set up to cater for future insolvency of insurers underwriting employees' compensation business.