Hong Kong Signs New CEPA Agreement: A Boost for Key Service Sectors

The Hong Kong Government has signed an agreement introducing various liberalization measures across service sectors where Hong Kong holds a competitive edge, such as financial services, construction, testing and certification, telecommunications, film, television, and tourism.

The Trade and Industry Department stated that these new measures aim to relax restrictions on equity shareholding, business scope, and qualification requirements for Hong Kong professionals.

Additionally, the “Second Agreement Concerning Amendment to the Mainland & Hong Kong Closer Economic Partnership Arrangement (CEPA)” eases rules for Hong Kong’s export of services to the Mainland, facilitating market access and operations for Hong Kong firms and professionals.

While most measures apply nationwide, some are designated for pilot implementation in the nine Pearl River Delta municipalities of the Guangdong-Hong Kong-Macau Greater Bay Area.

The agreement also introduces institutional innovations, such as allowing Hong Kong-invested enterprises to adopt Hong Kong law and choose Hong Kong as the arbitration seat.

Moreover, the agreement removes the requirement for Hong Kong service suppliers to have engaged in substantive business operations for three years in most sectors, allowing startups to benefit earlier from CEPA’s preferential policies.