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Trade and Industry Department The Government of the Hong Kong Special Administrative Region
Brand Hong Kong - Asia world city

24-hour hotline : 23 922 922

e-mail address : enquiry@tid.gov.hk

Ref: FRCP 1000/2/1

16 November 2005

Dear Sirs,

 

Certificate of Origin Circular No.

11/2005

Commercial Information Circular No. 468/2005

The Mainland and Hong Kong
Closer Economic Partnership Arrangement (CEPA)

Revised CEPA Rules of Origin for Watches and
Registration of Hong Kong Brand Watches


INTRODUCTION

As foreshadowed in the Certificate of Origin Circular No. 8/2005 (Commercial Information Circular No. 434/2005) dated 25 October 2005, the Mainland and Hong Kong have agreed to relax the existing CEPA rules of origin (ROOs) for watches by waiving the 30% value-added content requirement for watches of Hong Kong brand names. This circular informs the trade on the definition of Hong Kong brand, and sets out the procedures for application and registration of Hong Kong brand watches.

DETAILS

Revised CEPA ROOs for Watches

  1. On 14 November 2005, the Mainland Customs General Administration issued a Notice announcing the revised CEPA ROOs for watches (Mainland 2005 tariff codes 91021100 and 91021200) as follows:
    1. Assembly of component parts and accessories into watch. The principal processes are assembling watch movement into the watch body, assembling of component parts and accessories (watch buckle, watch band, dial and battery, etc.) into watch, testing, time adjustment and quality control and to fulfil the value-added content requirement; or
       
    2. Assembly of component parts and accessories into watch. The principal processes are assembling watch movement into the watch body, assembling of component parts and accessories (watch buckle, watch band, dial and battery, etc.) into watch, testing, time adjustment and quality control and the exterior design of the watch should be carried out in Hong Kong. The watch should belong to a "Hong Kong brand" jointly determined by Hong Kong and the Mainland authorities. There should be clear Hong Kong origin marking (e.g. "Manufactured in Hong Kong", "Made in Hong Kong" or "Hong Kong", etc.) on the shell of the "Hong Kong brand" watch.

(Copy of the Chinese version of the Notice is attached at Annex 1 (pdf format)).

The above revised CEPA ROOs for watches has taken effect since 15 November 2005. Watches which satisfy either criteria (1) or (2) above are eligible to apply for Certificate of Hong Kong Origin - CEPA ("CO(CEPA)") and claim CEPA tariff preference.

Definition of "Hong Kong Brand"

  1. There are three criteria determining a CEPA "Hong Kong brand" applicable to watches:
    1. owner of the brand must be a Hong Kong registered company with a valid business registration (BR), and a valid factory registration (FR) for at least one year;
       
    2. owner of the brand must complete the trademark registration of their brand name goods under the Trade Marks Ordinance (Laws of Hong Kong Cap. 559), and be the registered owner of the brand; and
       
    3. the registered brand in (2) above includes a brand self-developed in Hong Kong or a foreign brand wholly acquired by a Hong Kong registered company.

Registration of Hong Kong Brand Watches

  1. Manufacturers who wish to register their watch products as Hong Kong brand watches for their CO(CEPA) applications must complete the Application Form for Registration of Hong Kong Brand Watches (FRWB1) attached to Annex 2 (pdf format) of this circular. Together with supporting documents, manufacturers can send in their application form FRWB1 by fax or by email to the Certificate of Origin - CEPA Section ( fax number : 2787 6048 / e-mail address : cepaco@tid.gov.hk ), or return the form and documents in person or by post to the Customer Service Centre of the Factory Registration and CO(CEPA) Branch at 3/F, Trade and Industry Department Tower, 700 Nathan Road, Kowloon. Supporting documents should include (i) a copy of the Certificate of Registration of the trademark issued by the Intellectual Property Department; and (ii) a copy of the Notice of the Registration published in the Hong Kong Intellectual Property Journal. For brands obtained by acquisition, documentary proof on the acquisition, such as a copy of the relevant pages of the acquisition agreement, etc. must also be provided.
     
  2. When application form and supporting documents are in order, a pre-registration inspection by officers of the Customs and Excise Department will be arranged as soon as possible. The Trade and Industry Department will refer the verified application to the Mainland Ministry of Commerce (MOC) for confirmation. MOC will complete the process of confirmation within 60 calendar days. Upon confirmation of the Hong Kong brand, the Trade and Industry Department will inform the applicant in writing and assign a Registration Number to the brand concerned.

CO(CEPA) Application

  1. Following the assignment of Registration Number to the brand, the manufacturer may submit CO(CEPA) applications for the relevant Hong Kong brand watches. The registered brand name must be provided in the field "Brand Names and Labels" when applying for CO(CEPA). The manufacturer must also comply with other conditions of issuing CO(CEPA) as stipulated in the circular on "Mainland 2005 Tariff Codes for Application for Certificate of Hong Kong Origin - CEPA ("CO(CEPA)")" issued on 30 December 2004 which can be downloaded from the Department's webpage <http://www.tid.gov.hk/english/cepa/tradegoods/trade_goods.html>.

Review of the Conditions of Issuing CO(CEPA) and Application Procedures

  1. The application procedures and conditions of issuing CO(CEPA) will be subject to review. Traders will be kept informed of any changes.

HANDLING OF INFORMATION

  1. The certificate issuing organizations will keep the data provided by traders in strict confidence. However, the Trade and Industry Department may under certain circumstances disclose such data to the Customs and Excise Department or other government departments, or to third parties within or outside Hong Kong. These circumstances include the following: the disclosure is necessary to facilitate the consideration or verification of the CO(CEPA) in question; the disclosure is authorized or required by the laws; or an explicit consent to the disclosure is given by the traders concerned.

IMPORTANT NOTE

  1. It is the responsibility of traders to complete the application for CO(CEPA) fully and truthfully, and provide the supporting documents as required under the conditions of CO(CEPA). Failure to provide accurate and complete information may affect the consideration and processing of the application, and may result in the application being deferred or rejected.

WARNING

  1. The Trade and Industry Department and GACOs work closely with the Customs and Excise Department, through checks and inspections, to ensure compliance with the provisions of Import and Export Ordinance, Cap. 60 and its subsidiary legislations as well as the Protection of Non-Government Certificates of Origin Ordinance, Cap. 324. Companies/registered businesses/individual may be liable to criminal prosecution for circumventing the conditions of issuing CO(CEPA). A company/registered business/individual which commits an offence under the Ordinances is liable to a maximum penalty of a fine of HK$500,000 and 2 years' imprisonment. Moreover, the Trade and Industry Department and GACOs may take administrative actions against the traders concerned irrespective of whether they have been prosecuted. Such administrative actions may involve, but shall not necessarily be confined to, any or all of the following: refusal to issue a certificate including CO(CEPA); suspension of all kinds of certification facilities; cancellation of Factory Registration of the company/registered business/individual concerned.

ENQUIRIES

  1. Should you require further information on the content of this circular, please contact us through any of the following channels -

Address : Certificate of Origin - CEPA Section
Factory Registration and CO(CEPA) Branch
3/F, Trade and Industry Department Tower
700 Nathan Road, Kowloon

Telephone No. : 2398 5781/3403 6432

Fax No. : 2787 6048

E-mail Address : cepaco@tid.gov.hk

Yours faithfully,

 

(Steven M L MA)

for Director-General of Trade and Industry