2022 Hong Kong car recycling/scrapping procedures and precautions to take (and how to keep your vehicle registration mark)
With a serious shortage of parking spaces in Hong Kong, and the sharp rise in oil prices in recent years, the cost of car ownership has become very high. If you no longer plan to keep your car, and are eager to cash out and leave Hong Kong, or your car is no longer roadworthy and cannot be repaired, you can elect to have it scrapped. That way, at least you can get back the scrap price of your car.
However, the Hong Kong car scrapping industry is rather shrouded in mystery, and most drivers know very little and even have some misunderstandings about it. For example, some worry that their car will be used by criminals for unlawful purposes, and the car owner will end up a victim. In today’s article, Kwiksure will present a useful summary of the procedures and precautions to take when having your car recycled/scrapped in Hong Kong.
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Five steps for having your vehicle scrapped
Step 1: Decide whether to have your car scrapped
When deciding whether to have your car scrapped, you can consider the following factors. Common reasons for scrapping a car include:
- The repair cost is too high or the time needed is too long (for example, the repair cost is 60% of the car’s price, or it takes a month to repair)
- The car model has lost its attractiveness in the market and is difficult to resell
- You do not want to handle a resale
- You are in a rush to cash out
- You expect your car will have frequent breakdowns in the future and thus will require frequent repairs
Step 2: Contact a registered car scrapping company
Contact the car scrapping companies registered with the Environmental Protection Department. Some of them provide online quotations. Car owners only need to enter the information of their vehicle to get quotations. Most of the required information can be found on your Vehicle Registration Document, and usually include:
- Vehicle’s model and year of production
- Transmission type (manual or automatic)
- Engine displacement (expressed in cc)
- Vehicle’s body condition and how well it drives
- The area the car is parked in
A recycling quotation will usually be received within 24 hours. If you are satisfied with the price, you can agree with the car scrapping company on a suitable time and place for the vehicle’s delivery. If your vehicle can no longer be driven, you should ensure that all haulage and transportation costs will be paid by the car scrapping company. Otherwise, you will be responsible for arranging and paying to have your car towed to the site of the car scrapping company.
Step 3: Clear your own items from the car
Remember to take your own items from the car. The most frequently forgotten items include "AutoToll", the "oil cards", and the "parking card" in the sun visor.
Step 4: Bring all the documents for the delivery
On the delivery day, please bring the following documents:
- The original Vehicle Registration Document
- The original and a copy of the vehicle license
- The original and a copy of the owner's Hong Kong Identity Card (HKID Card)
- The car keys
The staff of the car recycling company will inspect the car on the spot to check the performance and condition of the car. If everything is normal, the car recycling company will pay the collection price in cash or by cheque, and provide a receipt and a Vehicle Scrapping Certificate (commonly called the car scrapping paper) as proof of car scrapping, so that the car owner can cancel the vehicle registration at the Transport Department (TD). The scrapping certificate should specify the date and time of delivery, and include the company stamp and business registration number of the car scrapping company.
A warm reminder from Kwiksure: remember to take the vehicle license from your vehicle.
Step 5: Cancel the vehicle registration at the Transport Department
Within 15 days after your vehicle is delivered to the car scrapping company, you will need to submit or send by mail the following documents to the TD to complete the cancellation of the vehicle registration. Otherwise, you will be held responsible for all legal liabilities related to the vehicle.
- The original Vehicle Registration Document
- The original vehicle license (if still valid)
- The original Vehicle Scrapping Certificate
- Your identity document (if another person performs this step on your behalf, that person will have to present their HKID Card)
- A completed Form TD184 (Notice of Cancellation of Vehicle Registration)
- The original Certificate of Allocation of Personalized Registration Mark (if applicable)
List of government-registered car scrapping companies
The Environmental Protection Department's list of registered car scrapping companies can be found here.
Risks of vehicle scrapping
If you choose an unscrupulous middleman to have your car scrapped on your behalf, there is a chance that the car may change hands many times during the process, causing your personal information to be leaked. As a matter of fact, that middleman may not even be a legally qualified car scrapping company. They may just buy the car from you, then hand it over to criminals who then use it to commit crimes. You could then be arrested by the police as the registered owner of a vehicle used in a crime.
Some unscrupulous middlemen would hold themselves out as providing a car scrapping service, when in fact, what they are after is the Vehicle Registration Document, causing the owner to suffer losses. Therefore, it is crucial to choose a vehicle scrapping company that is reputable and registered with the government.
How can I keep the vehicle registration mark after scrapping my car?
If you wish to keep the vehicle registration mark for use on another vehicle under your name in the future, you may apply to retain the vehicle registration mark at the same time you cancel your vehicle registration with the TD.
Applicants are required to complete the "Application to Transfer or Retain a Vehicle Registration Mark" (Form TD129) and "Notice of Cancellation of Vehicle Registration" (Form TD184). The original Vehicle Registration Document, the original vehicle license, the original Vehicle Scrapping Certificate, and the identity document of the registered owner must be submitted together with the application. The application to transfer or retain a vehicle registration mark must be processed at the Hong Kong Licensing Office or the Kowloon Licensing Office from Monday to Friday, and the fee is HKD $560. By contrast, the application for vehicle registration cancellation is free of charge.
The retained vehicle registration mark will be reserved for 12 months. If the applicant fails to transfer the registration mark to another vehicle before the deadline, the Commissioner for Transport will cancel the current allocation of the vehicle registration mark, and reallocate it to any other vehicle.
Frequently asked questions and precautions for car scrapping
Q: If there is an “unused” portion of the vehicle license fee after a car is scrapped, will the TD refund it?
A: Yes. The calculation method for the refund of the remaining vehicle license fee is the annual license fee of the vehicle, times 0.24%, times the number of days remaining in the validity period of the vehicle license, and subject to the following three conditions:
- A refund will be available only if at least 60 days remain in the validity period of the vehicle license. The date on which the calculation is based is the date of "cancellation of vehicle registration" by the TD.
- If you plan to use the car scrapping in a "one-for-one", the date of cancellation of vehicle registration will be delayed by 1-3 months. In other words, if your vehicle license has a remaining validity period of less than three months at the time of scrapping, the TD generally will not refund the “unused” license fee.
- If you cancel a vehicle registration, the license fee refund check will be mailed by the Treasury to the registered address of the vehicle owner. The payee will be the registered vehicle owner (if your address has changed, you should notify the TD), and the process will take about 4 to 6 weeks. No additional application is required for license fee refunds.