New agreements under the Closer Economic Partnership Arrangement framework was signed in Hong Kong on November 27. The new agreement will realize trade in services liberalization between Chinese Mainland and Hong Kong.

 

With the presence of Hong Kong SAR Chief Executive Leung Chun-ying and Qiu Hong, vice director of Liaison Office of the Central People's Government in the Hong Kong SAR, Financial Secretary John Tsang Chun-wah and Vice Commercial Minister Wang Shouwen signed the CEPA Trade in Services Agreement(The Agreement) at the headquarters of Hong Kong SAR Government.

 

According to the “most-favored clause” in the Agreement, the most-favored-nation treatment Chinese mainland offered to other countries or regions, if more favored than that in the CEPA, will be expanded to Hong Kong to guarantee Hong Kong’s enjoying of the most-favored policies.

With reference to the framework of Mainland and Hong Kong Closer Economic Partnership Arrangement-Agreement between the Mainland and Hong Kong on Achieving Basic Liberalization of Trade in Services in Guangdong (Guangdong Agreement), the Agreement, including the newly added opening-up measures this year, the CEPA and its additional agreement and the commitment on the opening-up of trade in services in Guangdong Agreement, will be an independent sub-agreement on trade in services under the CFPA framework.

 

Under the Agreement, a total of 153 sectors of Chinese mainland will be completely or partly opened to Hong Kong, accounting for 95.6% of WTO’s all sectors of trade in services. And, national treatment will be offered to Hong Kong in 62 sectors for “commercial presence” service mode. 

 

Negative list pertinent to “commercial presence” covers 134 departments on trade in services, and keeps 120 limitation measures incompliant with national treatment.

 

Positive list covering service, telecommunication and cultural service sectors adds 28 opening-up measures.

 

In terms of investment approval simplification, the approval for the contract and constitution on the establishment and alteration in most trade in service departments for Hong Kong providers is changed to registration.

 

According to John Tsang Chun-wah, the signing of CEPA will play an important role in driving the interactive economic cooperation, carrying out the principle of complementation, mutual benefit and reciprocity and achieving joint development.

 

The Central Government brought forward the target of the achievement of basic liberalization of trade in services between the mainland and Hong Kong by the end of the 12^th Five-year Plan Period. The Guangdong Agreement signed last year, a pilot program to achieve the target in Guangzhou first, is a free trade agreement formulated by the mainland in the form of pre-establishment national treatment plus negative list for the first time.

 

Source: Translated from Invest Guangzhou, Nov. 30, 2015