‘Unequal’ Disney deal leaving Hongkongers to foot the bill
Inked in 1998, the arrangement sees a good portion of the local theme park’s profits go directly to its parent company, even in years of loss
The deal between the Hong Kong government and Walt Disney has long been labelled an “unequal treaty”, which sees the American parent company receive millions in potential profits while the city’s taxpayers are left to foot most of the park’s bills.
The arrangement, similar to that of other Disney parks around the world, requires the park to pay its California-based parent royalties for using copyright images and management fees for operating the park’s facilities.
Though Hong Kong Disneyland has never disclosed the amount of such fees, lawmaker Michael Tien puk-sun estimated HK$50 million in management fees and HK$200 million in royalties were being paid to the American conglomerate every year.
The New People’s Party deputy chair said the Lantau Island amusement park would not be losing money if it did not have to fork out those charges.
Industry insiders described it as a good deal for Walt Disney, as the company could pocket a big portion of its parks’ revenue before profits are generated. And in loss-generating years, the company would not have to pay corporate tax to local governments – which has been the case eight of the past 11 years for Hong Kong Disneyland.