For Immediate Release
To celebrate the 10th anniversary of the Closer Economic Partnership Arrangement (CEPA), the newly announced CEPA Supplement X introduces 73 measures to further facilitate and liberalize services and trade. The Hong Kong General Chamber of Commerce welcomes the latest initiatives and is pleased that many of our recommendations have been accepted in the latest supplement, which the Chamber believes will help expand trade and cooperation between the two places.
Chamber Chairman C K Chow pointed out that even though the Mainland has entered into trade agreements with other regions or countries, the Central Government continues to ensure that CEPA would provide the highest level of liberalization. As such, any liberalization measures covered by the Cross-Strait Economic Cooperation Framework Agreement but not in CEPA will also be extended to CEPA.
He strongly supports the announcement and believes that it will boost Hong Kong’s business and trade development. He also welcomes further relaxation of restrictions on the scope of operation, access to selected regions and markets, as well as raising the threshold on shareholdings. These measures will encourage more Hong Kong enterprises to expand into the Mainland market and strengthen the SAR’s status as Asia’s leading business hub.
Some 65 of the service liberalization measures introduced under Supplement X will benefit Hong Kong’s legal, tourism, testing & certification, and printing service sectors, among others. Eight additional measures are designed to strengthen cooperation in areas of finance and facilitate trade and investment of the two places, including a breakthrough in the liberalization of financial services.
Qualified Hong Kong financial institutions will soon be able to set up a full-licensed joint venture securities company in Shanghai, Guangdong Province and Shenzhen on a pilot basis, and the maximum percentage of aggregate shareholding of the Hong Kong-funded institution is 51%. In addition, qualified Hong Kong financial institutions’ shareholding in a joint venture fund management company could exceed 50%. The feasibility of mutual recognition of fund products in Hong Kong and the Mainland will also be seriously examined. All these measures will create new opportunities for financial innovation and cooperation between the two places, including the development of Hong Kong into an offshore renminbi centre.
Chamber CEO Shirley Yuen said: “Over the past decade, the Chamber has regularly submitted constructive proposals to the two governments on further enhancing CEPA. We are pleased that many of these proposals have been adopted.” For instance, the Chamber suggested strengthening cooperation between the legal sectors of Hong Kong and the Mainland. Under Supplement X, Hong Kong law firms and Guangdong law firms will be allowed to enter into an agreement under which Guangdong law firms may second Mainland lawyers to work as consultants on Mainland law in representative offices set up by Hong Kong law firms in Guangdong Province to provide legal services.
New measures relating to tourism will facilitate cooperation between Hong Kong and Mainland enterprises, such as the decision to abolished restrictions on total business turnover. The minimum capital and operational facilities requirements to set up a travel agency are also relaxed. Shirley Yuen believes that the new measures can greatly enhance the competitive advantage of Hong Kong’s tourism service providers in Mainland China.
Yuen added that the latest liberalization measures under Supplement X are more comprehensive and far-reaching than previous supplements. The latest enhancements are an important milestone in the liberalization of services between the Mainland and Hong Kong as stipulated in the “Twelfth Five-Year-Plan.” In particular, the significant number of pilot measures to be implemented in Guangdong will bring Hong Kong-Guangdong cooperation to new heights. The Chamber urges companies to make use of the latest developments to grow their business in the Mainland.
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