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Hong Kong, China – New Zealand Closer Economic Partnership Agreement

Overview

New Zealand was Hong Kong's 38th largest trading partner. Merchandise trade between New Zealand and Hong Kong amounted to HK$7,934 million in 2016. In terms of services trade, New Zealand was our 28th largest trading partner, with bilateral services trade amounted to HK$3,275 million in 2015.

Leaflet on Hong Kong, China - New Zealand Closer Economic Partnership Agreement

agreement

Background

Hong Kong and New Zealand signed the Hong Kong, China – New Zealand Closer Economic Partnership Agreement (CEP Agreement) on 29 March 2010.  The Agreement is Hong Kong's first free trade agreement (FTA) with a foreign economy, and the second FTA following the Closer Economic Partnership Arrangement with the Mainland of China.  Not only is it a landmark achievement in taking the bilateral trade and economic relations between Hong Kong and New Zealand to a higher plane, the CEP Agreement also signifies Hong Kong's desire and readiness in pursuing high quality FTAs with our trading partners.

The CEP Agreement facilitates trade in goods and services between Hong Kong and New Zealand and opens up new business opportunities.  It also strengthens the trade and investment ties between the two economies.

The CEP Agreement entered into force on 1 January 2011.

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Key Outcomes

The CEP Agreement is a comprehensive and high quality FTA that is fully consistent with the rules of the World Trade Organization.  It comprises trade liberalisation measures on both trade in goods and services. Major features and liberalisation measures of the CEP Agreement are summarised below.

Exporting Hong Kong Goods to New Zealand
  • The CEP Agreement provides for a total elimination of tariffs on all Hong Kong's exports to New Zealand in six years, i.e. 1 January 2016.
Document Requirements for Exporting Hong Kong Goods to New Zealand
  • Hong Kong traders who comply with the relevant origin requirements and follow the relevant operational procedures can benefit from the preferential tariff treatment for exports to New Zealand.
  • Hong Kong traders who claim preferential tariff treatment for their exports to New Zealand may be requested by New Zealand to provide a declaration of origin of the goods concerned. The declaration of origin shall be made on the commercial invoice or any other document relating to the goods.
  • With respect to any goods falling within Chapter 61 or 621 of the Harmonized Commodity Description and Coding System, Hong Kong traders can claim preferential tariff treatment from New Zealand by applying for a certificate of origin (CO). The CO shall be issued by the Trade and Industry Department or by a Government Approved Certification Organisation of Hong Kong.
  • Please refer to Chapter 4 (Rules of Origin) and its Annex in the Text of the Agreement and trade circulars issued by the Trade and Industry Department for details concerning the rules of origin, document requirements, record keeping requirements and other relevant issues for exporting goods originating in Hong Kong to New Zealand under the CEP Agreement.
Exporting New Zealand Goods to Hong Kong
  • Hong Kong commits to bind the provision of tariff free access to all New Zealand originating products upon the entry into force of the CEP Agreement.
  • Imports from New Zealand are not required to be accompanied by an origin declaration or certification of origin in order for the goods to enjoy the tariff-free treatment.
Customs Procedures and Cooperation
  • The CEP Agreement provides for mutual cooperation in the administration of custom matters. It seeks to ensure that the customs procedures and practices applying to goods traded between the two sides are predictable, consistent, transparent and trade facilitating.
Trade Remedies2
  • Hong Kong and New Zealand have agreed to prohibit the use of export subsidy on all products in the bilateral trade.
  • Originating products of Hong Kong or New Zealand will not be subject to safeguard actions by one another, if such products are not a cause of or a threat to cause serious injury to the domestic industry.
  • Provisions are in place to enhance the transparency on the use of anti-dumping measures.
Sanitary and Phytosanitary (SPS) Measures3 and Technical Barriers to Trade (TBT)4
  • Mechanisms are established to facilitate the competent authorities of Hong Kong and New Zealand to enhance cooperation in various areas, including recognising equivalent measures, aligning audit and verification procedures, improving transparency, etc.
  • Both sides may also conclude implementing arrangements on trade facilitating initiatives relating to SPS and TBT measures.
1 Chapter 61 includes articles of apparel and clothing accessories, knitted or crocheted, whereas Chapter 62 includes those articles of apparel and clothing accessories, not knitted or crocheted.
2 Trade remedy measures refer to anti-dumping, countervailing and safeguard measures. Imposition of these measures by the importing economy could result in additional duties (being one of the usual forms) on top of tariffs and other charges or other import restrictions on certain imports.
3 Sanitary and phytosanitary measures are any measures applied: (i) to protect human or animal life from risks arising from additives, contaminants, toxins or disease-causing organisms in their food; (ii) to protect human life from plant- or animal-carried diseases; (iii) to protect animal or plant life from pests, diseases, or disease-causing organisms; and (iv) to prevent or limit other damage to a country from the entry, establishment or spread of pests.
4 The disciplines of technical barriers to trade cover all technical regulations, standards and conformity assessment procedures that may directly or indirectly affect the trade in goods between parties to an FTA, regardless of the origin of the goods.

View full text of Chapters and Annexes relating to Trade in Goods:

Chapter 3: Trade in Goods
Chapter 4: Rules of Origin
  (Note: With the adoption of the 2017 Edition of the World Customs Organization Harmonized Commodity Description and Coding System, an updated Product Specific Rules Schedule can be accessed here)
Chapter 6: Trade Remedies
  • The CEP Agreement covers a comprehensive and diverse scope of service sectors, ranging from business and professional services, communication services, financial services and transport services to construction and related engineering services, distribution services, educational services, environmental services, health and social services, tourism and travel related services, as well as recreational, cultural and sporting services.
  • The CEP Agreement will secure better business opportunity and greater certainty for service providers of Hong Kong and New Zealand and the services they provide in the above sectors in each other's market.
  • In terms of market access, service providers of Hong Kong and New Zealand and the services they provide will enjoy the following benefits in each other's market in a variety of service sectors:
  • They will be treated no less favourably than their counterparts of the other side in similar circumstances.
  • There will not be any restriction in the form of limitations on foreign capital, number of service providers or operations, value of service transactions, number of persons employed, types of legal entity or joint venture requirements.
  • They will not be required to establish or maintain any form of enterprise, or to be resident, in the other side as a condition for the supply of cross border trade in services.
  • They will automatically enjoy more liberalisation measures which the other side undertakes in its future FTAs with other trading partners.
  • Both Hong Kong and New Zealand have made broad commitments covering a wide range of services. Many of the commitments go beyond not only their existing commitments in the World Trade Organization (WTO), but also their offer in the current WTO service negotiations.
  • New Zealand's commitments encompass sectors of Hong Kong's traditional priority, such as maritime transport services, logistics and related services, audiovisual services and various business services such as accounting, auditing and bookkeeping services, computer and related services, management consulting services and services incidental to manufacturing.
  • They also include areas identified for further promotion, such as, education services, medical services, testing and certification services, environmental services, innovation and technology, and cultural and creative industries.
  • Hong Kong's commitments are comparable to those of New Zealand, covering those of particular interest to New Zealand, such as educational services, environmental services, professional services, construction and related engineering services, air transport services, as well as logistics and related services.
  • The CEP Agreement also includes a set of robust disciplines on domestic regulation. It ensures that measures affecting trade in services are transparent, administered in a reasonable, objective and impartial manner, and do not become unnecessary barriers to trade.
  • Recognising that education is an area of mutual interest, the two sides have also agreed to enter into an arrangement to promote cooperation in this field.

Movement of Business Persons

  • The CEP Agreement includes commitments of Hong Kong and New Zealand in respect of movement of business persons. Their respective commitments are comparable and both go beyond those already undertaken under the WTO.
  • Without compromising legitimate immigration control, business persons of Hong Kong and New Zealand in the categories of business visitors, intra-corporate transferees, and installers or servicers in specified service sectors will be granted temporary entry into the areas of the other Party under favourable conditions.
  • Coupled with the streamlined and transparent immigration procedures agreed by the two sides, the CEP Agreement would further facilitate movement of business persons between Hong Kong and New Zealand.

Electronic Commerce

  • The CEP Agreement establishes a set of shared principles and a framework for cooperation and consultation between Hong Kong and New Zealand on electronic commerce.
  • In line with the Agreement's broader objective to achieve trade liberalisation, the two sides have agreed to maintain an open trading environment for the free flow of information and services. E-government initiatives will also seek to reduce barriers to trade.
View full text of the Chapters and Annexes relating to Trade in Services:

  • In addition to commitments in the above areas, the two sides have agreed to negotiate an Investment Protocol to the CEP Agreement.
  • The investment negotiations will cover elements that aimed to enhance the promotion and protection of investments between the two sides, including non-discrimination, fair and equitable treatment, full protection and security, etc. The resulting Investment Protocol will help facilitate mutual investment flows and expand economic activities in both places.
  • The two sides have agreed to promote competition through measures including:
  • maintaining transparency in competition policies, laws and rules;
  • applying competition policies in a non-discriminatory manner; and
  • reviewing exemptions and exceptions from competition regimes to ensure that they are no broader than necessary.
  • The two sides will also encourage cooperation and information exchange between their competition authorities. Upon request by either Party, the two sides will consult on particular anti-competitive practices that affect trade and investment.

View full text of the Chapter:

Chapter 9: Competition
  • The two sides have reaffirmed their commitments under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights. These include, among others, maintaining (a) transparent regulations; (b) efficient, effective and non-discriminatory enforcement mechanisms; and (c) access to expeditious remedies.
  • The two sides will also exchange information and cooperate on issues related to the protection or enforcement of IP rights. A consultation mechanism for resolving possible IP-related disputes has also been agreed.

View full text of the Chapter:

  • The two sides have agreed on rules governing their GP activities, including non-discrimination and transparency in the GP process. In essence, Hong Kong has committed to treat suppliers of New Zealand like suppliers from a party of the WTO Agreement on GP, in respect of the procurements of Hong Kong's bureaux and departments.
  • In return, New Zealand will also follow the rules on GP and provide comparable market access opportunities to Hong Kong suppliers.

View full text of the Chapter :

  (Annex I: List of Entities and Covered Goods and Services:
  (Annex IV: Contact Point)
  • The two sides have agreed to establish a transparent and comprehensive mechanism to provide for consultations and settlements of possible disputes that may arise from the CEP Agreement. An arbitral tribunal may be established if consultations fail to resolve the issue.

View full text of the Chapter: