Hong Kong-China CEPA

(CLOSER ECONOMIC PARTNERSHIP ARRANGEMENT)

 

WHAT IS CEPA?

ê A free trade deal between Hong Kong and mainland China

(China’s first free trade agreement)

ê Effective from 1 January 2004

ê Significant China market liberalisation

ê Preferential access to China’s market from Hong Kong

ê Offers better deal than China’s WTO commitments

  A boost to your first-mover advantage in China

   
WHAT DOES IT MEAN?

ê Zero tariffs on 90% of Hong Kong exports to China

ê Faster/easier market access for 18 service sectors

ê Lower entry thresholds for smaller players (capital/trading history requirements)

ê 100% ownership of many China ventures

ê Makes Hong Kong the simplest, most profitable route into/out of China

ê Manufacturers in China able to use Hong Kong services

  An expressway to China through Hong Kong


WHO QUALIFIES?

ê Hong Kong-based companies, regardless of size or nationality, can be eligible.

ê Service providers (in 18 Cepa-eligible areas):

ê Must be incorporated in Hong Kong

ê Doing business in Hong Kong for past 3-5 years

ê Liable for profits tax

ê Employing 50% of staff locally

ê Manufacturers/distributors of goods (273 categories of goods covered):

ê Goods must qualify as “made in Hong Kong” under Rules Of Origin

ê Rules being finalised – decision expected in October 2003

  Strengthens Hong Kong as your platform for China business


HOW CAN OVERSEAS COMPANIES TAKE ADVANTAGE?

ê Partner with a Cepa-qualified firm in Hong Kong

ê Invest in a Cepa-qualified company

ê Buy a Cepa-qualified company

ê Access TDC Cepa services

 

What is the difference between a Free Trade Agreement and a Closer Economic Partnership Agreement?

Normally FTAs are signed between two countries. Because of the ‘one country, two systems’between the Chinese mainland and Hong Kong, a new name has been used. In all other ways Cepa is a FTA.

 




 Back to Index of August 2003