Closer Economic Partnership Arrangement (Cepa)
The Closer Economic Partnership Arrangement (CEPA) is China's free trade agreement with Hong Kong. It grants easier access to China markets for Hong Kong-made products, and Hong Kong-based service companies.
CEPA signed in 2003 between the Mainland Government and Hong Kong Government liberalizes the mainland`s trade rules governing goods and services of Hong Kong origin. CEPA represents China¡¯s most significant market opening since its accession to the WTO. It opens up new opportunities on the mainland for Hong Kong-based companies, regardless of nationality. Firms seeking to sell ¡°made in Hong Kong¡± goods into the Chinese mainland will benefit from zero tariffs. In particular:
1. Duty-free export to China for Hong Kong-made products:
1,407 categories of 'Made in Hong Kong' products will be exempt from tariffs when exported to the Chinese mainland.
2. Easier market entry for Hong Kong-based service providers:
CEPA covers 28 service sectors and reduces, or removes geographical, financial and ownership restraints.
3. Any nationality company can apply if it:
- Is incorporated in Hong Kong
- Has operated for 3 to 5 years (depending on the sector)
- Is liable to pay Hong Kong profits tax
- Employs 50% of its staff locally
4. Benefits for non-Hong Kong company:
Overseas companies, not based in Hong Kong, can take advantage of CEPA by outsourcing to, or partnering with a Cepa-qualified manufacturer or service provider in Hong Kong.
5. Further liberalization measures in 2007:
The Mainland and Hong Kong have agreed on a package of further liberalization measures under CEPA covering both goods and services, as well as other cooperative measures. For further details, please log on to:
For Business Matching with a CEPA -qualified company, contact your nearest TDC Kuala Lumpur office.
Hong Kong Trade Development Council (TDC), Kuala Lumpur
Suite 35-1, Level 35, Menara Dion,
27, Jalan Sultan Ismail,
50250 Kuala Lumpur, Malaysia.
Posted Date: 27 Mar 2004