11 July 2017
New CEPA and Ecotech Agreements Extend Investment and Co-operation Opportunities
The government of the Hong Kong Special Autonomous Region and China’s Ministry of Commerce (MOFCOM) have recently signed a new Investment Agreement in line with the terms of the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA). The new agreement comes into effect as 1 January 2018.
The new Agreement spells out the substantive obligations of both parties with regards to investment access. For its part, the Ministry has committed to providing national treatment to Hong Kong investments and investors in line with that enjoyed by mainland-based investments and investors, except in the 26 instances specified under the terms of the Agreement. In certain sectors, Hong Kong has also been granted preferential investment access compared to that extended to other external investors.
Under the terms of the Agreement’s Most-Favoured Treatment provision, any preferential treatment China extends to investments and investors from other countries or regions must also be extended to Hong Kong investments and investors. As the commitments regarding the admission of investment in the services sector have already been covered and implemented under the terms of the Agreement on Trade in Service, the new Agreement only applies to investments in areas outside the scope of this earlier services agreement, including manufacturing, mining and certain designated assets.
The separate Agreement on Economic and Technical Co-operation (Ecotech Agreement), which was signed at the same time, outlined the specific future direction for closer co-operation between the two parties, including the incorporation of co-operation with regard to the economic and trade aspects of the Belt and Road Initiative, as well as sub-regional co-operation, into the overall CEPA framework. The two sides also agreed on a number of new areas for future co-operation, including working more closely together with regards to legal and dispute resolution services, finance, accounting, technological innovation, e-commerce and intellectual property. This second agreement came into force as of 28 June 2017.
For further details, please refer to the following website: