Registration for Precious Metals and Stones Dealer is effective, what prestige jewelry shop and Luxury watches traders should do? – Useful tips
The “Registration System for Dealers in Precious Metals and Stones” has been implemented since April 2023. All companies engaged in the trading of precious metals and gemstones, if they will conduct transactions totaling HK$120,000 or more, must complete the registration by the end of 2023.
In addition to providing valid business registration certificates and business premises addresses as proof, they must also fulfill statutory obligations by conducting “customer due diligence”, using customers’ identity documents to identify and verify their identities.
Large jewelry industry conglomerates and chain gold shops have well-established systems and properly manage their sales records, so they generally do not encounter too many problems in the application process.
In contrast, the majority of small jewelry shops, gold shops, or new entrants often face the following difficulties in the licensing application process.
Case Study: Requested by Customs and Excise Department for Face-to-Face Interview
May, the owner of an IG shop, became part of the unemployed masses during the pandemic, and began selling fashion accessories online.
With several years of jewelry sales experience, she was introduced by a former customer to collaborate with a supplier in mainland China, gradually introducing high-priced fashion accessories worth over tens of thousands.
As everyone knows, rents in Hong Kong are high, and May has been relying mainly on IG and WeChat marketing for years, occasionally participating in pop-up booths in large shopping malls, but without a physical store. She has always worked as a “One Man Band”, busy “getting customers” and stocking up, and basically just fulfilling orders without having the time to verify the identity and background of her customers.
As a result, during the application process, as she was unable to provide proof documents for the business address and customer identity verification, the Customs and Excise Department repeatedly raised queries.
May tried to respond in writing, but it did not help the progress. Due to the back-and-forth between the two parties many times, the Customs and Excise Department listed the application as suspicious, such as suspecting it was a shell company, and requested a face-to-face interview.
Fortunately, May then understood that such matters and dealing with government departments were not her forte, so she decided to have an experienced accountant handle it.
“Maxi Accounting” understood May’s entire business and consolidated the queries raised by the Customs and Excise Department in the past. We put down May’s sales and purchase process in steps, and put them in a readable format to the Customs and Excise Department. In the process, a new customer due diligence system has implemented.
The system was created to crack down on “money laundering”, and simply “talk it though” is not enough to deal with the inquiries.
Many business owners are hands-on and take everything to heart, but at the appropriate times, “delegating to others” and letting professional staff handle it can make things more efficient.
Each industry has its unique business techniques. Consulting with “Maxi Solution Accounting,” an accounting company with over 20 years of experience, can help you avoid many pitfalls and facilitate the growth of your business.
“Maxi Solution Accounting” – an accounting partner that can help you prosper.
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