More CEPA sweeteners for Hong Kong inked on 10th anniversary
Hong Kong and the central government signed new agreements under the Closer Economic Partnership Arrangement (CEPA) framework on Thursday that will benefit a bunch of local businesses. The move rai s es the curtain on the mainland market higher for industries from finance to legal and from filmmaking to telecommunication.
Under the new terms, Hong Kong law firms and their Guangdong peers can sign agreements to send mainland lawyers to work as consultants in representative offices set up by Hong Kong law firms in the province.
In the financial sector, Hong Kong-funded securities companies will be allowed to make reference to the securities assets being managed by the respective group when applying for Qualified Foreign Institutional Investor (QFII) status.
Qualified local financial institutions will also be able to set up joint- venture fund management companies on the mainland. The Hong Kongfunded institutions can hold more than 50 percent of the joint venture. Meanwhile, local financial institutions that satisfy requirements for establishing an overseas-invested securities company will be authorized to form one fully licensed jointventure securities company in Shanghai, Shenzhen and other parts of Guangdong province respectively. The Hong Kong party can hold as much as 51 percent.
Furthermore, Hong Kong telecom companies are granted the right to set up jointventures in Guangdong to provide online data processing and transaction- processing services. Hong Kong- made movies will also be screened across the mainland with Cantonese dialogues and Mandarin subtitles, currently only available in a small number of cinemas in big cities.
The new supplement marks the 10th anniversary of CEPA since the arrangement to enhance economic and trade cooperation was sealed in 2003.
Thursday’s supplement contains 73 measures, 65 of which are liberalization measures for trade in service industries, with the remaining eight to strengthen cooperation in areas of finance and to facilitate trade and investment between the two places. To date, the number of CEPA liberalization measures for trade in services has reached 403.
“CEPA effectively improves the integration of the economy between the mainland and Hong Kong,” said John Tsang Chun-wah, financial secretary of Hong Kong, at the signing ceremony. “To the end of last month, over HK$52.4 billion Hong Kong products have been sold to the mainland, enjoying duty-free status and saving 3.6 billion yuan ($588 million) in tariffs. The newly signed supplement is the best way to commemorate the 10th anniversary of CEPA.”
“The supplement will continue to provide more opportunities to the services industries in Hong Kong and benefit the mainland economy as well,” said Gao Yan, viceminister of commerce. “We will keep working towards liberalization of trade in services between the mainland and Hong Kong. Various authorities will enhance cooperation and remove the barriers to carrying out CEPA more smoothly on the mainland. I believe CEPA will play a more important role in cross-border economic development in the future.”