Hong Kong-registered ships enjoy trading privileges not available to foreign vessels

Hong Kong's shipping register has surged 150 per cent since 1999 to reach more than 16 million gross tonnes in December 2002, underscoring the SAR's status as an international maritime centre.

The rapid increase followed the introduction of a package of initiatives that give an advantage to Hong Kong ships, according to P.C. So, general manager of the Shipping Registry and Seafarers Branch, Hong Kong Marine Department.

"These measures have attracted ship owners to place their ships on the Hong Kong Shipping Register and to establish their businesses in Hong Kong. They are opening offices here and use Hong Kong shipping-related facilities such as legal services, insurance and financing," he said.

Ship owners are attracted to Hong Kong as an international shipping hub because of its location, deep-water port, excellent infrastructure, efficient civil service and well-developed legal system, as well as the dynamic commercial activity in the region.

Mr So added that through close co-operation with shipping authorities in the Pearl River Delta (PRD) and elsewhere in China, Hong Kong-registered ships can trade directly between Hong Kong and mainland China. Foreign ships have to obtain prior approval from Chinese authorities he said.

"Hong Kong has a very good relationship with authorities in the PRD region, so it is easy to handle shipping-related issues." Hong Kong now ranks ninth in the world in terms of registered tonnage.

Ship owners have welcomed the reforms which have also enabled Hong Kong to maintain itself as a quality register of international standing. The measures include the lowering of registration fees by 80 per cent and annual tonnage fees by 45 per cent. The fee structure has also been simplified.

Taxation benefits

In addition, Hong Kong has reached tax concession agreements with eight of its major trading partners - the United States, China, South Korea, New Zealand, the Netherlands, UK, Singapore and Germany. A preferential port dues agreement with the Chinese mainland gives Hong Kong ships a 30 per cent reduction in dues in Chinese ports.

The streamlining of procedures for ship owners registering in Hong Kong includes a round-the-clock service 365 days a year on request. Formalities now take just two hours compared with one or two months previously.

Mr So said new quality controls meant that data relating to Hong Kong-registered ships is collected from international maritime authorities and organisations. All survey-related costs are now borne by the Marine Department instead of by the ship owners.

"This system has received overwhelming support from the ship owners," Mr So said.

Hong Kong government policies proactively help business, Mr So added. Hong Kong has minimal restrictions on investment, foreign exchange and the establishment of companies.

In addition, Hong Kong is a free port, has a 100 per cent market economy and is the gateway to China. "These elements will help Hong Kong maintain its position as an international maritime hub in the short term."

Looking further ahead, Mr So sees Hong Kong as focusing less on traditional shipping business such as conventional cargo handling and ship repair, and concentrating on higher value-added "intellectual" business such as ship registration, high-tech port management, ship financing, insurance, brokering and logistics.

Related link:
Hong Kong Marine Department www.info.gov.hk/mardep