New deal boosts Hong Kong firms' entry into Mainland service sectors

The agreement will take effect on 1 March 2025.

The government has signed an agreement that will introduce various liberalisation measures across service sectors where Hong Kong holds a competitive advantage, including financial services, construction, testing and certification, telecommunications, motion pictures, television, and tourism.

The Trade and Industry Department said the new measures aim to ease 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)" relaxes rules on Hong Kong's export of services to the Mainland, making it easier for Hong Kong firms and professionals to enter and operate in the Mainland market.

Most of the measures will apply across the entire Mainland, whilst some are designated for pilot implementation within the nine Pearl River Delta municipalities of the Guangdong-Hong Kong-Macau Greater Bay Area.

Financial Secretary Paul Chan said the the further liberalisation under the agreement will make it easier for Hong Kong firms and professionals to access opportunities in the Mainland.

In the construction and related engineering services sector, for example, Hong Kong general practice surveying enterprises will be allowed to provide services in Guangdong Province through a simple record-filing process.

In tourism, there will be improvements to the 144-hour visa-exemption policy for foreign group tours entering Guangdong via Hong Kong.

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

Furthermore, the agreement removes the requirement for Hong Kong service suppliers to have engaged in substantive business operations in Hong Kong for three years in most sectors, enabling startups to benefit sooner from CEPA’s preferential treatment.