Why Hong Kong?
An International Business City
Underpinning its international status is Hong Kong's robust legal system, largely based on the British system. The rule of law, upheld by an independent judiciary, is a cornerstone of Hong Kong's success providing legal protection for business contracts and intellectual property rights.
Hong Kong advocates and practices free trade - a free and liberal investment regime, the absence of trade barriers, no discrimination against overseas investors, freedom of capital movement, well-established rule of law, transparent regulations, and low and predictable taxation.
There are 7 primary reasons why many international companies and SMEs choose Hong Kong.
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- Hong Kong is an Important Market for Canadian Goods
- Hong Kong is an Important Location for Canadian Interests
- Canada is an Important Market for Hong Kong Goods
- Close Links between Canada and Hong Kong
- Hong Kong Practices Free Trade
- Hong Kong Respects Intellectual Property Rights
- Hong Kong's Labour Force is Protected by Legislation
Above data provided by the Hong Kong Trade Development Council, and Hong Kong Economic Trade Office (HKETO) in Canada, and prepared by the Trade and Industry Development of the Government of the HKSAR.
1) Hong Kong is an Important Market for Canadian Goods
- In 2006, Canada ranked 21st among suppliers of goods to Hong Kong. During the year, merchandise imports from Canada rose by 16.3% to C$1.6 billion. For Canada, Hong Kong was its 15th largest export market.
- Major Canadian exports to Hong Kong include non-ferrous metals; electrical machinery, apparatus and appliances, n.e.s., and electrical parts thereof; as well as raw hides, skins and furskins.
- In addition, Canada was Hong Kong's 12th largest supplier of gold (including gold coins). A total of C$10 million of gold (including gold coins) was imported from Canada in 2006.
2) Hong Kong is an Important Location for Canadian Interests
- Hong Kong is ideally located in relation to the Pacific Rim and the Mainland of China (the Mainland).
- There are currently four government and quasigovernment Canadian representative offices and trade promotion agents in Hong Kong: Alberta Government, Manitoba Trade Office, Service D'immigration du Quebec, and Canadian Education Centre.
- Hong Kong is home to the largest Canadian business community in Asia. 150 Canadian companies maintain branches or subsidiaries in Hong Kong, while another 450 Canadian firms are represented through distributors, agents or joint venture partners.
- Hong Kong is one of the world's major financial centres in which banking and insurance play a vital role. There are 6 Canadian banking institutions in Hong Kong, including Canadian Imperial Bank of Commerce, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal and Royal Bank of Canada. There are also seven Canadian or Canadian-controlled insurance companies authorized to operate in Hong Kong, including Manulife (International) Limited and Sun Life Hong Kong Limited.
- Canadian-controlled companies also participate actively in securities and futures trading and in the field of investment advice. There are 12 Canadian controlled firms engaging in brokerage and/ or investment advisory business in Hong Kong.
- Hong Kong welcomes overseas investment and offers an environment in which there is a free flow of capital and return on investment without exchange controls.
- All foreign companies benefit from the government's policy of providing an efficient business environment and supporting infrastructure, including good communications, an excellent infrastructure including efficient port and airport facilities, a stable currency free from exchange controls, a simple tax structure and low tax rates, and an established legal and judicial system.
3) Canada is an Important Market for Hong Kong Goods
- In 2006, Canada ranked 12th among Hong Kong's export markets of goods. Domestic exports of merchandise to Canada valued at C$234 million. Reciprocally, Hong Kong was Canada's 47th largest import source.
- Major Canadian purchases from Hong Kong include office machines and automatic data processing machines, articles of apparel and clothing accessories, as well as electrical machinery, apparatus and appliances, n.e.s., and electrical parts thereof.
4) Close Links between Canada and Hong Kong
- Canada continues to be a popular destination for Hong Kong emigrants. In 2006, there were approximately 1,700 Canadian citizenship applications from Hong Kong.
- In 2005, there were approximately 20,000 Hong Kong students studying in Canada and over 1,300 study permits were issued to Hong Kong students. There were over 100,000 Canadians university alumni with 22 active alumni associations in Hong Kong.
- The Canadian nationals represent one of the most significant foreign presences in Hong Kong. In 2006, there were over 300,000 Canadian nationals visiting/ residing in Hong Kong.
- Hong Kong is an important source of investment for Canada. In 2005, Hong Kong's foreign direct investment in Canada was C$6.3 billion. In 2006, Canadian direct investment in Hong Kong was C$3.8 billion.
- There are 41 direct scheduled passenger flights each week in each direction between Hong Kong and Canada, operated by major carriers such as Cathay Pacific Airways. Besides, Cathay Pacific Airways also runs freighter services between Hong Kong and Vancouver.
5) Hong Kong Practices Free Trade
- Hong Kong is a staunch supporter of the multilateral trading system and adheres to the WTO/GATT principles of non-discrimination and most-favoured-nation treatment. Hong Kong takes seriously its rights and obligations as a member of the WTO. Our free trade policy applies to both merchandise trade as well as trade in services.
- Hong Kong was ranked the world's freest economy in the Heritage Foundation 2007 Index of Economic Freedom and in the Cato Institute's 2006 Annual Report on Economic Freedom of the World.
- Hong Kong does not subsidise its exports or any particular sector of the economy.
- Hong Kong does not levy any tariffes. As an internal tax to raise revenue, excise duties are levied on imported as well as domestically produced cigarettes and tobacco, alcoholic products, methyl alcohol and some hydrocarbon oils. In 2006, less than 2% of all imports were subject to excise duties.
- Hong Kong treats foreign and local companies on the same footing.
- Hong Kong does not maintain any barriers to trade.
- Imports from Canada can compete freely with locally made products and imports from other countries. Imports from Canada were on a continued increase during the past 4 years, attaining an average annual growth of 9.7% in value terms. In 2006, imports from Canada had a robust growth of 16.3% in value terms, following an increase of 1.6% in 2005.
6) Hong Kong Respects Intellectual Property Rights
- Hong Kong has an established legal framework for the protection of intellectual property rights in patents, trade marks, copyright, and registered designs. Our intellectual property legal framework is fully compatible with all our obligations under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).
- The Intellectual Property Department (IPD) provides a focal point for the development of intellectual property rights protection in Hong Kong. It administers the registration systems for trade marks, patents, designs and copyright licensing bodies. The Customs and Excise Department (C&ED) is responsible for the enforcement of criminal sanctions against copyright and trade mark infringements.
- Hong Kong is determined to have a robust intellectual property regime and maintain its status as a responsible trading partner. Vigorous enforcement actions are taken against piracy and trade mark counterfeiting activities. The C&ED has a dedicated enforcement team of some 400 officers, one of the strongest in the region. The piracy situation in Hong Kong has been brought under firm control.
- An admendment bill was introduced in March 2006 to update the Copyright Ordinance to enhance copyright protection; to improve the copyright exemption system; to further liberalise certain restrictions on parallel importation; and to strengthen enforcement efforts against copyright offences.
- The IPD operates electronic registration services to provide a more efficient and cost-effective means for registration and management of trade marks, patents and registered designs. The system of IPD can now provide web-based electronic search of the register, electronic filing of applications for registration, electronic publication and payment for applications for registration, as well as real-time renewal of trade marks and patents and changes of a registrant's name. Interactive services for assignment/assent of trade marks, extension of time for trade mark applications and online search of description of goods and services are also available since May 2006.
7) Hong Kong's Labour Force is Protected by Legislation
- Hong Kong's labour force enjoys rights and benefits that are adequately protected by a comprehensive set of labour legislation and an effective labour inspection system. Comprehensive labour laws, coupled with effective administrative measures, have enabled Hong Kong to apply 41 international Labour Conventions which prescribe internationally recognized standards on various labour matters.