CEPA to Be Revised for Third Version: Foreign Companies Setting Up in Hong Kong Can Enjoy Same Treatment as Local Firms When Entering Mainland
nashnova research
Hong Kong announced a third revision to CEPA, its trade pact with mainland China — the key change is that any foreign company incorporating in Hong Kong can now access the mainland on equal footing with local firms; this formally widens Hong Kong's role as the institutional gateway into China.
What exactly is changing in CEPA's third revision?
Commerce Secretary Algernon Yau said that after the revision, any foreign company that sets up in Hong Kong can enter the mainland under CEPA and receive the same treatment as local Hong Kong firms.
A second key change: products manufactured in Hong Kong by foreign firms can enter the mainland duty-free, provided they meet the "Made in Hong Kong" certification standard.
This means → foreign companies no longer need to register directly on the mainland — a Hong Kong entity alone unlocks CEPA market access, significantly lowering the bar.
Why now?
The revision sits under Hong Kong's first five-year plan, which explicitly calls for "continuous, comprehensive upgrading of CEPA."
In plain terms = Hong Kong has long called itself a "super connector" between China and the world; this revision builds that claim into the rulebook — foreign capital entering the mainland via Hong Kong now has a clearer institutional basis.
The specific timeline and detailed rules, however, have not been published — whether it lands on schedule is the key watch point.
Where does the RCEP application stand?
Yau said on September 21 that new applicants to RCEP (Regional Comprehensive Economic Partnership — a free-trade agreement covering 15 Asia-Pacific economies) must be approved individually by each member state's legislature before the matter returns to the RCEP level for discussion.
This means → the process inherently takes years; no quick breakthrough is likely in the near term.
The Hong Kong government pledged to actively lobby member states; RCEP will also set up a working group to review the application.
What was signed with ASEAN?
On the same day, Hong Kong signed the First Protocol to Amend the Hong Kong–ASEAN Investment Agreement, with Philippine Trade Secretary Ma. Cristina A. Roque and Thai Deputy Prime Minister and Commerce Minister Suphajee Suthumpun in attendance.
Under the amended terms, Hong Kong firms operating in all ten ASEAN member states will receive treatment no less favorable than that granted to local or other foreign enterprises.
This reflects a dual-track push — northward (CEPA into the mainland) and southward (ASEAN) — widening market access in both directions.
How important is ASEAN to Hong Kong?
As of end-2024, ASEAN was Hong Kong's third-largest outward direct investment destination, with a stock of HK$671.2 billion.
It was simultaneously Hong Kong's sixth-largest source of inward direct investment, at HK$448.5 billion.
In plain terms = ASEAN is a major route both for Hong Kong capital going out and for foreign capital coming in — this upgraded agreement makes money flow more smoothly in both directions.
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