New agreement signed under framework of CEPA to basically achieve liberalisation of trade in services between the Mainland and Hong Kong
Friday, November 27, 2015
The Chief Executive, Mr C Y Leung, witnessed the signing of the Agreement on Trade in Services (the Agreement) by the Financial Secretary, Mr John C Tsang, and the Vice Minister of Commerce, Mr Wang Shouwen today (November 27).
The Agreement is a new agreement signed between the Hong Kong Special Administrative Region Government (HKSARG) and Ministry of Commerce under the framework of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA). It makes reference to the framework of the Agreement between the Mainland and Hong Kong on Achieving Basic Liberalisation of Trade in Services in Guangdong (the Guangdong Agreement) signed last year. In addition to including new liberalisation measures introduced this year, by covering and consolidating commitments relating to liberalisation of trade in services provided in CEPA and its Supplements and also the Guangdong Agreement, the Agreement becomes a stand-alone, subsidiary agreement relating to trade in services under the framework of CEPA.
The main text of the Agreement sets out provisions for, among others, national treatment, most-favoured treatment, safeguard measures, exceptions, and investment facilitation; the three annexes of the Agreement set out respectively the specific commitments of the Mainland and Hong Kong in liberalisation of trade in services, the definition of "Service Supplier" and related requirements.
Key contents of the Agreement are summarised as follows:
Overall speaking, there are 153 sectors which the Mainland has fully or partially opened up to Hong Kong services industry, accounting for 95.6 per cent of all the 160 World Trade Organization services trade sectors. In respect of the mode of "commercial presence", national treatment will be applied to Hong Kong in 62 sectors.
In respect of the mode of "commercial presence", the negative list covers 134 services trade sectors, reserving 120 restrictive measures as inconsistent with the obligation of national treatment.
The positive lists, covering cross-border services as well as the sectors of telecommunications and cultural services, have newly added 28 liberalisation measures.
- The Agreement has liberalisation measures in a number of important sectors. Specific examples are set out in the Annex (pdf format) .
With regard to investment facilitation, for Hong Kong service suppliers in the majority of services trade sectors, filing administration is adopted in lieu of prior approval of contracts and articles of association for establishment and change of enterprises.
Hong Kong's favourable position to enjoy the most preferential liberalisation measures of the Mainland is assured by the "Most-Favoured Treatment" provision of the Agreement, which specifies that any preferential treatment the Mainland accorded to other countries or regions, if more preferential than those under CEPA, will be extended to Hong Kong.
The Agreement shall come into effect on the day of signing and be implemented as from June 1, 2016.
The Central Government announced in 2011 to basically achieve liberalisation of trade in services in the Mainland for Hong Kong by the end of the National 12th Five-Year Plan period. The Guangdong Agreement signed last year achieved this goal in advance in Guangdong in the form of early and pilot implementation and it was the first free trade agreement drawn up by the Mainland with pre-establishment national treatment and in the form of negative list. On the basis of the Guangdong Agreement, the Agreement signed this year further enhances the liberalisation in both breadth and depth, including extending the implementation of the majority of Guangdong pilot liberalisation measures to the whole Mainland; reducing the restrictive measures in the negative list; and adding 28 liberalisation measures in the positive lists for cross-border services as well as cultural and telecommunications services. The Agreement will basically achieve liberalisation of trade in services between the Mainland and Hong Kong, enabling both sides to reach a new milestone after the continuous liberalisation of trade in services through CEPA over the years.
The public can visit the Trade and Industry Department's CEPA website at www.tid.gov.hk/english/cepa/index.html for details on CEPA.Ends