Mainland and Macao Closer Economic Partnership Arrangement
CEPA is an FTA-like arrangement concluded between two separate customs territories of a single sovereign state, in conformity with the World Trade Organization (WTO) rules, with the objective of promoting joint economic prosperity and development of the Mainland and Macao Special Administrative Region.
The first phase of CEPA was signed on 17 October 2003 and came into effect on 1 January 2004. To enrich CEPA's contents as well as broaden its commitments, the Mainland and Macao signed the Supplement to CEPA, the Supplement II to CEPA, the Supplement III to CEPA, the Supplement IV to CEPA, the Supplement V, the Supplement VI, the Supplement VII, the Supplement VIII to CEPA, the Supplement IX to CEPA, the Supplement X to CEPA, CEPA Agreement between the Mainland and Macao on Achieving Basic Liberalization of Trade in Services in Guangdong and CEPA Agreement on Trade in Services under the framework of CEPA on 29 October 2004, 21 October 2005, 26 June 2006, 2 July 2007, 30 July 2008, 11 May 2009, 28 May 2010, 14 December 2011, 2 July 2012, 30 August 2013,18 December 2014 and 28 November 2015 respectively.
The coverage of CEPA mainly consists of three parts, they are: (1) trade in goods, (2) trade in services, and (3) trade and investment facilitation.
Trade in Goods
The Mainland agrees to apply zero tariff to all goods of Macao origin, starting from 1 January 2006, except for goods that are prohibited from imports into the Mainland. To enjoy zero tariff treatment, goods of Macao origin exporting to the Mainland must fulfill the rules of origin stipulated under CEPA and to obtain the specific "Certificate of Origin" (CO) to be qualified as "Made in Macao".
As stipulated in the Supplement II to CEPA, Macao manufacturers can, in line with the relevant application procedures, submit their requests for zero tariff treatment to the Macao Economic Bureau. Following the verification and certification proceedings on the requests, Macao Economic Bureau will enter into consultations with the Customs General Administration on the rules of origin for the products upon confirmation by the Ministry of Commerce. The two sides will then promulgate the relevant rules of origin before 1 June and 1 December each year and the Mainland shall, no later than July 1 of the same year and 1 January of the following year respectively, apply zero tariff treatment to the relevant imported Macao products.
Trade in Services
The Mainland has progressively provided preferential treatment on market access to the following service sectors: legal, accounting, construction and real estate, medical and dental, advertising, management consulting, convention and exhibition, telecommunications, audiovisual, distribution, insurance, banking, securities and futures, tourism, transport, freight forwarding agency, storage and warehousing, logistics, air transport, information technology, professionals qualification examinations, cultural and recreational, trade mark agency, patent agency, job referral agency, job intermediary, individually owned stores, computer and related services, market research, services related to management consulting, public utility, building-cleaning, photographic, printing, translation and interpretation, environmental, social, sporting services, services incidental to mining, related scientific and technical consulting services, research and development services, technical testing, analysis and product testing services, specialty design services, interdisciplinary research and experimental development services, services incidental to manufacturing, library, archive, museum and other cultural services, education services, railway transport services, duplicating services as well as after-death facilities services.
In compliance with the WTO principles and rules, CEPA provides the Macao service suppliers with an earlier access to the Mainland market, ahead of the timetable China has committed to the WTO. In some sectors, such as audiovisual services, transport services as well as medical and dental services, the concessions are actually more favorable than those of China's WTO commitments.
CEPA Agreement on Trade in Services is the first free trade agreement which liberalizes trade in services to the whole Mainland with market access provisions for national treatment and the management approach of negative listings. It also re-states the existing liberalization content under CEPA and its Supplements, signifying full liberalization of trade in services between the whole Mainland and Macao. The number of services sub-sectors from Macao, to those national treatment will be applied, under the Agreement is 62, including advertising, photography, convention, hotels and restaurants, tourist guides, road transport, and so on. Upon implementation of the Agreement, the Mainland has opened up 153 services trade sub-sectors to the Macao services industry, accounting for 95.6 % of the 160 sub-sectors under WTO Services Sectoral Classification System. According to the standards of WTO services classification, a basic liberalization of trade in services has been achieved between the two places, and the target to basically achieve liberalization of trade in services in the Mainland for Macao by the end of the National 12th Five-Year Plan period is completed.
Trade and Investment Facilitation
For promotion of trade and investment, the Mainland and Macao agreed to cooperate in 10 areas of trade and investment facilitation, namely trade and investment promotion; customs clearance facilitation; commodities inspection, inspection and quarantine of animals and plants, food safety, sanitary quarantine, certification, accreditation and standardization management; electronic business; transparency in laws and regulations; co-operation of Small and medium sized enterprises; industrial co-operation; protection of intellectual property rights; cooperation on brand promotion and cooperation on education.
According to the CEPA Agreement on Trade in Services, for the purpose of investment in the liberalized services sectors by Macao Service Suppliers, the establishment of a company and the change of contract/articles of association of a company will be subject to filing administration. The adoption of filing administration will be further extended geographically from Guangdong to the whole Mainland, improving the relevant management approach of negative listings, leading to a higher level of investment facilitation for the Macao investors to access the Mainland market.
CEPA in Figures
From 1 January 2004 to 31 January 2018, Macao Economic Bureau has issued 4,808 CEPA certificates of origin, in which, 4,246 certificates have been exercised, involving products of total export value of MOP866,907,674 with an estimate tariff saving amounting to MOP62,177,721. These goods include cement, textiles and clothing, yarn, plastic bags, recordable compact discs, printing ink, food and beverage (confectionery, biscuits, nuts, coffee beans, coffee powder and distilled water for human consumption), refined copper foil, electric conductors, chemicals(thinners, glue, salt of tetracyclines, etc), postages, ribbons for typewriters, footwear, crude glycerol, recycled plastics, cosmetic products, other industrial monocarboxylic fatty acids and fiberglass cloth, etc. With respect of trade in services, Macao Economic Bureau has approved 628 "Macao Service Supplier" certificates, which primarily engaged in service sectors of transport and logistics, convention and exhibition, management consulting, construction, distribution, telecommunications, legal, advertising, sales and marketing services for air transport, real estate, audiovisual, travel agency, medical and dental, job referral agency, trade mark agency, printing and publishing, research and development services on natural sciences, banks and other financial services, highway passenger transportation services as well as services auxiliary to insurance, etc.
CEPA Information Enquiries
To enhance the promotion and implementation of CEPA, Macao Economic Bureau has established the "Regional Cooperation Information Center" for public enquiries and delivery of relevant applications.
Add: Rua Dr. Pedro José Lobo, 1-3, Luso International Bank Building, 2/F., Macao
Tel: (853) 8597 2343
Fax: (853) 2871 2553