Hong Kong signs new supplement to Cepa
Hong Kong on Thursday signed a new supplement to the Cepa trade pact with the mainland, giving further preferential access for the city’s service sectors across the border.
The 10th supplement to the Closer Economic Partnership Arrangement includes 73 new measures covering banking, securities, legal, film, testing and certification sectors.
The pact was first signed in October 2003 when Hong Kong was struggling to recover from an economic downturn following the Sars epidemic that year. It has been expanded since then.
The latest supplement takes the total number of measures signed under the agreement to 403. It will come into effect in January next year.
The new measures relating to securities allow Hong Kong-funded financial institutions to apply for qualified foreign investor status that will allow them to set up joint venture fund management companies in mainland China. Hong Kong-funded institutions will be allowed to hold more than 50 per cent of shares in these joint ventures.
Hong Kong-funded financial institutions can also set up one fully licensed joint venture securities company each in Shanghai, Guangdong and Shenzhen with a maximum aggregate shareholding of 51 per cent.
In relation to film-making, Hong Kong films and those co-produced by Hong Kong and mainland film-makers can now be shown in Cantonese in mainland China as long as subtitles are written in simplified Chinese characters.
On technical testing and analysis services, the scope of testing services for certification that can be undertaken by Hong Kong organisations will be expanded from food to other areas of voluntary product certification on a pilot basis in Guangdong.
Certification bodies, inspection bodies and laboratories jointly or solely set up in mainland China by Hong Kong service suppliers, when participating in testing and certification activities, will be accorded the same treatment as their counterparts on the mainland.
In relation to the legal sector, representative offices set up by Hong Kong law firms in Guangdong will be allowed to hire mainland lawyers as consultants to advise on issues relating to mainland law.
Hong Kong Motion Picture Industry Association chairman Crucindo Hung welcomed the relaxation of restrictions on Hong Kong films. He said it would help reduce production times and costs, and would also help retain the original flavour of works.
Hong Kong Investment Funds Association chief executive Sally Wong Chi-ming said the supplement would create more business opportunities for Hong Kong institutions.
But the Law Society vice-chairman Thomas So said the new measures would have little impact on Hong Kong law firms. He said hiring mainland lawyers as consultants would still involve complicated issues such as levels of fees and revenue division.