Hong Kong: Medical Devices Included in 2nd Phase of HK-Mainland Trade Agreements

On January 1, 2005, the 2 nd phase of Mainland China and Hong Kong’s Closer Economic Partnership Arrangement (CEPA) was launched. CEPA was established to remove barriers to trade between Hong Kong and the Mainland and to promote investment and cooperation. Under the new phase, 11 medical products will receive tariff preference. Stethoscopes, endoscopes, blood transfusion apparatus and anaesthetic apparatus are examples of products that will become non-tariff goods. CEPA only applies to products manufactured in Hong Kong and exported directly to Mainland China.

To be eligible for preference under CEPA, manufacturers must be registered with the Hong Kong Trade and Industry Department (TID). If registered, a manufacturer may apply to the TID for a Certificate of Origin, which verifies that the products to be exported under CEPA have been produced in Hong Kong. This is referred to as a CO(CEPA). The approval process can be completed within 1.5 working days.

Each CO(CEPA) is valid for 120 days from the date of issue. A single CO(CEPA) can cover a maximum of five Mainland tariff codes and those tariffs must correspond to goods eligible for zero tariff. The CO(CEPA) is used to authenticate the Mainland importer’s claim for CEPA tariff preference. However, importers are still required to fulfill Mainland customs clearance and other requirements.

In order to promote CEPA to small and medium-sized Hong Kong enterprises, the TID offers four funding schemes. Hong Kong firms can utilize these schemes to finance the purchasing of equipment to produce CEPA-eligible goods, hold trade fairs and exhibitions to promote their business in Mainland China, and take courses about the opening-up of the Mainland market.