The Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) is a free trade agreement between Mainland China and Hong Kong, signed in 2003.
CEPA benefits Hong Kong businesses
This mutually-beneficial agreement allows for new business opportunities for Mainland China, Hong Kong and for all foreign investors.
CEPA is a fantastic agreement, as it opens up huge markets for Hong Kong goods and services, leading to greater economic integration and cooperation between the Mainland and Hong Kong.
Hong Kong businesses have an opportunity to gain a greater foothold in the Mainland market as a result of CEPA.
CEPA benefits Mainland China
As well as benefitting Hong Kong, CEPA serves Mainland China as a fantastic “springboard” for Mainland companies to access the global market. This enables Mainland China to fully integrate with the global economy.
An opportunity for foreign investors to enter the Chinese market
Foreign investors are also encouraged to set up a business in Hong Kong in order to take advantage of the benefits that CEPA provides and to break into the powerful Mainland China market.
How is CEPA implemented?
Trade in services
Service suppliers from Hong Kong are given preferential treatment when entering the Mainland market. Hong Kong’s professional bodies and the regulatory authorities in the Mainland have also signed multiple agreements on mutual recognition of professional qualifications.
Trade in goods
Mainland China is pleased to offer zero tariff preference to goods of Hong Kong origin when they are imported into the country, provided they meet CEPA rules of origin (ROOs) and are accompanied by Certificates of Origin.
In the Mainland, Hong Kong investors are given preferential treatment in non-service sectors too. Also included in the Investment Agreement are provisions for the promotion, protection, and facilitation of investments.
Economic and Technical Cooperation
As part of the agreement, both sides agreed to enhance cooperation in 22 areas in order to support developments, promote trade, and facilitate investments between Hong Kong and Mainland China.
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