WT/REG400/1/Rev.1  
16 December 2020  
(20-9122) Page: 1/46 
Committee on Regional Trade Agreements    
 
FACTUAL PRESENTATION  
FREE TRADE AGREEMENT  BETWEEN HONG KONG, CHINA  AND AUSTRALIA  
(GOODS AND SERVICES ) 
Report by the Secretariat  
Revision  
This report, prepared for the consideration of the Free Trade Agreement  between 
Hong Kong, China  and Australia , has been drawn up by the WTO Secretariat on its own 
responsibility and in full consultation with the Parties. The factual presentation 
reproduces as closely as possible the terminology used in the Agreement and in the 
comments provided and does not imply official endorsement or acceptance by the 
Secretariat of such terminology. The report has been drawn up in accordance with the 
rules and procedures contained in the Decision for a Transparency Mechanism for 
Regional Trade Agreements (WT/L/67 1) and thus does not imply any value judgement 
by the Secretariat regarding the contents of the Agreement.  
Any technical questions arising from this report may be addressed to Jean-Daniel Rey  
(tel: +41 22 739 52 64 ). Any statistical questions arising from this report may be 
addressed to Rowena Cabos  (tel: +41 22 739 51 85 ). 
 
 
  WT/REG400/1 /Rev.1  
 
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   Table of Contents  
Page 
1   TRADE ENVIRONMENT  ................................ ................................ ................................ . 4 
1.1   Merchandise trade  ................................ ................................ ................................ ....... 4 
1.2   Trade in services and investment  ................................ ................................ ..................  6 
2   CHARACTERISTIC ELEMENTS OF THE AGREEMENT  ................................ ....................  11 
2.1   Background information  ................................ ................................ .............................. 11 
2.2   Structure of the Agreement  ................................ ................................ ......................... 11 
3   PROVISIONS ON TRADE IN GOODS  ................................ ................................ ...........  12 
3.1   Import duties and charges, and quantitative restrictions ................................ .................. 12 
3.1.1    General provisions  ................................ ................................ ................................ ...12 
3.1.2    Liberalization of trade and tariff lines  ................................ ................................ ......... 13 
3.1.2.1    Hong Kong, China  ................................ ................................ ................................ .13 
3.1.2.2    Australia  ................................ ................................ ................................ .............. 13 
3.1.3    Tariff rate quotas  ................................ ................................ ................................ .....14 
3.2   Rules of origin  ................................ ................................ ................................ ............ 14 
3.3   Export duties and charges, and quantitative restrictions  ................................ .................. 15 
3.4   Regulatory provisions on trade in goods  ................................ ................................ ........ 16 
3.4.1    Standards  ................................ ................................ ................................ ............... 16 
3.4.1.1    Sanitary and phytosanitary measures  ................................ ................................ ......16 
3.4.1.2    Technical barriers to trade  ................................ ................................ ..................... 16 
3.4.2    Safeguard mechanisms  ................................ ................................ ............................ 17 
3.4.2.1    Global safeguards  ................................ ................................ ................................ .17 
3.4.2.2    Bilateral safeguards  ................................ ................................ ............................... 17 
3.4.2.3    Safeguard measures related to balance of payment (BOP) dif ficulties  .......................... 17 
3.4.3    Anti-dumping and countervailing measures  ................................ ................................ .17 
3.4.4    Subsidies and State -aid ................................ ................................ ............................ 18 
3.4.5    Customs -related procedures and trade facilitation  ................................ ........................ 18 
4   PROVISIONS ON TRADE IN SERVICES AND INVESTMENT  ................................ .........  18 
4.1   Scope and definitions  ................................ ................................ ................................ ..18 
4.2   Denial of benefits  ................................ ................................ ................................ .......19 
4.3   General provisions on trade in services  ................................ ................................ ......... 19 
4.3.1    Market access  ................................ ................................ ................................ ......... 19 
4.3.2    National and MFN treatment  ................................ ................................ ...................... 19 
4.3.3    Commercial (local) pre sence  ................................ ................................ ..................... 20 
4.3.4    Performance requirement  ................................ ................................ ......................... 20 
4.3.5    Senior management and boards of directors  ................................ ............................... 20 
4.3.6    Movement of natural persons  ................................ ................................ .................... 20 
4.4   Liberalization commitments  ................................ ................................ ......................... 21 
4.4.1    Hong Kong, China  ................................ ................................ ................................ ....21 
4.4.1.1    MFN and horizontal commitments  ................................ ................................ ........... 21 WT/REG400/1 /Rev.1  
 
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  4.4.1.2    Sector specific commitments  ................................ ................................ .................. 22 
4.4.2    Australia  ................................ ................................ ................................ ................. 26 
4.4.2.1    MFN and horizontal commitments  ................................ ................................ ........... 26 
4.4.2.2    Sector specific commitments  ................................ ................................ .................. 27 
4.5   Regulatory provisions  ................................ ................................ ................................ ..30 
4.5.1    Domestic regulation  ................................ ................................ ................................ .30 
4.5.2    Recognition  ................................ ................................ ................................ ............. 31 
4.5.3    Subsidies  ................................ ................................ ................................ ................ 31 
4.5.4    Safeguards  ................................ ................................ ................................ ............. 31 
4.5.5    Other  ................................ ................................ ................................ ..................... 32 
4.5.5.1    Transparen cy and cooperation  ................................ ................................ ................ 32 
4.6   Sector specific provisions on trade in services  ................................ ................................ 32 
4.6.1    Financial services  ................................ ................................ ................................ .....32 
4.6.2    Telecommunications  ................................ ................................ ................................ .33 
4.6.3    Education services  ................................ ................................ ................................ ...33 
4.6.4    Air services  ................................ ................................ ................................ ............. 33 
4.7   Investment  ................................ ................................ ................................ ................ 34 
5   GENERAL PROVISIONS OF THE AGREEMENT  ................................ .............................  35 
5.1   Transparency  ................................ ................................ ................................ ............. 35 
5.2   Current payments and capital movements  ................................ ................................ .....35 
5.3   Exceptions  ................................ ................................ ................................ ................. 35 
5.3.1    General exception  ................................ ................................ ................................ ....35 
5.3.2    Security exception  ................................ ................................ ................................ ...35 
5.3.3    Taxation measures  ................................ ................................ ................................ ...36 
5.4   Accession and withdrawal  ................................ ................................ ............................ 36 
5.5   Institutional framework  ................................ ................................ ............................... 36 
5.6   Dispute settlement  ................................ ................................ ................................ .....36 
5.7   Relationship with other agreements concluded by the Parties  ................................ ........... 37 
5.8   Government procurement  ................................ ................................ ............................ 38 
5.9   Intellectual property rights  ................................ ................................ .......................... 39 
5.10   Competition  ................................ ................................ ................................ ............. 40 
5.10. 1   Environment ................................ ................................ ................................ .......... 41 
5.11   Labour  ................................ ................................ ................................ .................... 41 
5.12   Electronic commerce  ................................ ................................ ................................ .41 
5.13   Small and medium -sized enterprises (SMEs)  ................................ ................................ 41 
ANNEX 1  ................................ ................................ ................................ ........................  43 
 
  WT/REG400/1 /Rev.1  
 
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  Key Facts  
 
Parties to the Agreement:  Hong Kong, China and Australia  
 
Date of Signature:    26 March 2019  
 
Date of Entry into Force:  17 January 2020  
 
Date of Notification:   17 January 2020  
 
Full implementation:   17 January 2020  
 
 
1  TRADE ENVIRONMENT  
1.1  Merchandise trade1 
1.1.  With a GDP of USD 363 billion, in 201 8, Hong Kong, China 's total merchandise trade was valued 
at USD 1,196 billion (exports at USD 569 billion and imports at USD 627 billion); Australia 's total 
trade in the same year was USD 493  billion (exports at USD 257 billion and imports USD 236  billion), 
with a GDP of USD 1,418  billion. The trade to GDP ratios (2016 -2018) of the Parties were 187.4  for 
Hong Kong, China and 21.2  for Australia .  
1.2.  In 2018, Hong Kong, China was the 6th largest global exporter and the 5th largest global 
importer  (excluding intra -EU trade ) with 2.92% of world exports  and 3.16% of world imports .2 In 
comparison,  Australia was the 16th largest global exporter and the 17th largest global importer ( with 
1.32%  of world exports and 1.19% of world imports3). 
1.3.  With respect to bilateral trade, in 20194, Australia was Hong Kong, China's 17th largest export 
market (0.8%%), and its 14th largest source of imports (0.8%), while Hong Kong, China was 
Australia's 8th largest export destination (3%) and the 21st largest source of imports (0.3%).  
1.4.  Chart 1.1 summarize s the trends in global trade of the Parties as well as their bilateral trade 
relations.  It shows a n overall  moderate increase in global trade during  the period for both Parties, 
with a dip in 2009 due to the financial crisis and a similar slowdown in trade between 2013 and 
2015. A trade deficit  was maintained over the entire period for Hong Kong, China  while Australia  
experienced a  moderate  global trade surplus, with a deficit between 2015 and 2016 . Statistics from 
UNSD Comtrade show some discrepancies with respect to the magnitude of bilateral trade between  
the Parties . Data reported by Hong Kong, China shows a trade def icit with Australia during the first 
part of the period with a reversal from 2012 onwards  while d ata reported by Australia shows a 
constant trade surplus.  
 
1 Figures in this section, except with respect to bilateral trade and unless indicated otherwise, are from 
the WTO Trade Profiles as of March 2020 (2018 data). Export figures are calculated f.o.b. and imports c.i.f. 
World trade rankings exclude intra -EU tra de. 
2 The five top destinations for exports from Hong Kong, China were: China (55.3%); the EU(28) 
(8.5%); the US (7.3%); India (2.9%); and Japan (2.9%). Its five top sources of imports were: China (45.7%); 
Chinese Taipei (7.3%); the EU(28) (6.9%); Singapor e (6.5%), and Japan (5.8%).  
3 The five top destinations for exports from Australia were: China (34.7%); Japan (16.4%); Korea, Rep. 
of (7%); India (4.9%); and the EU(28) (4.9%). Its five top sources of imports were: China (24.5%); the 
EU(28) (18.1%); the US  (10.5%); Japan (7.4%), and Thailand (4.9%).  
4 For bilateral trade, figures reported by the Parties to UNSD, Comtrade database are used (2019 data).  WT/REG400/1 /Rev.1  
 
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  Chart 1.1 Hong Kong, China - Australia : Merchandise bilateral trade and with world, 
2010-2019 
 
Source:  UNSD Comtrade database and ITC TradeMap (Australia 2019).  
 
1.5.  The commodity structure of trade between the Parties  as well as of their global trade in the 
periods 201 7-2019 are shown in Chart 1. 2, on the basis of Harmoni zed System (HS) sections .  
1.6.  While Australia's global exports are dominated by minerals ( 52% of exports), Hong Kong, 
China's  main imports from Australia  are constituted by -products classified under the category 
"precious stones and precious m etal" (HS Chapter 71), representing 68% of Hong Kong, China's 
imports from Australia. This category was accounted for 11% of Hong Kong, China's imports5, but a 
relatively small share of Australia's exports (representing 6% of, but corresponding to its 2nd largest, 
exports to the world). Australia's  three main import categories from Hong Kong, China were 
machinery and mechanical appliances  (33% of Australia's  imports from Hong Kong, China ), natural 
and cultured pearls  and precious stones  (26%), and prepared  foodstuffs and beverages  (7%). 
 
5 Gold for non -monetary purposes represents an important subset of HS Chapter 71, which, when 
complemented by HS tariff lines 261690, 284310, and 284390, corresponds to 6% of Hong Kong, China's 
global imports.  
0510152025303540
0100200300400500600700800900
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019A. Hong Kong, China 2010 -2019
(USD B illions)
Imports from Australia (Right Axis)
Exports to Australia (Right Axis)
Total Imports
Total Exports
0510152025303540
0100200300400500600700800900
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019B. Australia 2010 -2019 
(USD Billions)
Imports from Hon Kong, China (Right Axis)
Exports to Hong Kong, China (Right Axis)
Total Imports
Total ExportsWT/REG400/1 /Rev.1  
 
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  Chart 1. 2 Hong Kong, China - Australia : product composition of merchandise trade, annual 
average , 2017 -2019  
 
Source:  UNSD Comtrade database and ITC TradeMap (Australia 2019) . 
 
Trade in services and investment  
1.7.  In 2018, Hong Kong, China 's share of  trade in commercial services trade  corresponded to 
1.97% of world total exports (valued at USD 114 billion  and 1.48% of world total imports (valued 
at USD 81 billion). Hong Kong, China was the  8th largest global exporter of services and 11th largest 
global importer. In comparison, Australia 's shares of global commercial services exports and imports 
corresponded to 1.18% of world total exports (valued at USD 68 billion) and 1.29% of world total 
imports (valued at USD 70 billion). Australia was the  13th largest global exporter and importer of 
services.  
1.8.  Chart s 1.3 and 1.4 below show  the breakdown of global trade in commercial services for the 
Parties . Travel services was Hong Kong, China's  main import and an important export, together with 
transport services. For Australia, travel services were, by far, the largest import s and export s, with 
transport services and manufacturing services constituting most of the remain ing imports from the 
world with transport services and financial services important exports sectors.  
33
2674444433224Australia's imports from Hong Kong, 
China (%)
Total: USD 591 million25
16
138544444311Australia's Global Imports (%)
Total: USD 226 billion6713542227Hong Kong, China's Global Exports 
(%)
Total:  USD 552 billion68875426Hong Kong, China's imports from 
Australia (%)
Total: USD 6,917 million641143222228HongKong, China's Global Imports 
(%)
Total: USD 598 billion52
6644432216Australia's Global Exports (%)
Total: USD 252 billion
Prepared foodsVegetablesLive animals
ChemicalsMinerals
PlasticsTextilesWood pulp
MachineryBase metals
Precious stonesMiscellaneousOptical
Vehicles OtherWT/REG400/1 /Rev.1  
 
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  Chart 1. 3 Hong Kong, China : Trade in commercial services with world, 2010 -2018  
 
Note:  Based on BPM6 . 
 No exports for Manufacturing services on physical inputs owned by others and  Construction (2010 -
2018).  
 Exchange rates to convert HK Dollar to US Dollar: 2010 (7.77) 2011 (7.78) 2012 (7.76) 2013 (7.76) 
2014 (7.75) 2015 (7.75) 2016 (7.76) 2017 (7.79) and 2018 (7.84).  
Source:  Hong Kong, China authorities.  
Chart 1.4 Australia: Trade in commercial services with world, 2010 -2018  
 
Note:  Based on BPM6 . 
 No imports for Manufacturing services on physical inputs owned by others and Construction (2010 -
2018) . 
 Exchange rates to convert Australian Dollar to US Dollar for 2017 -2018 are: 2017 (1.30) and 2018 
(1.34).  
Source:  WTO Statistics database and Australian authorities (2017 -2018).  
Manufacturing services 
Maintenance & repair services
Transport services
Travel servicesInsurance and pension 
services
Financial services
Charges for the use of 
intellectual property n.i.e.Telecom, computer and 
information services
Other business servicesConstruction
Personal, cultural and 
recreational services020406080100120
2010 2011 2012 2013 2014 2015 2016 2017 2018A. Hong Kong, China imports from world
2010 -2018
(USD Billion)
020406080100120
2010 2011 2012 2013 2014 2015 2016 2017 2018B. Hong Kong, China exports to world
2010 -2018
(USD Billion)
Manufacturing services on physical 
inputs owned by others
Maintenance & repair services, n.i.e.
Transport services
Travel servicesInsurance and pension 
services
Financial services
Charges for the use of 
intellectual property n.i.e.Telecom, computer and 
information services
Other business servicesConstruction services
Personal, cultural and 
recreational services01020304050607080
2010 2011 2012 2013 2014 2015 2016 2017 2018A. Australia imports from world
2010 -2018
(USD Billion)
01020304050607080
2010 2011 2012 2013 2014 2015 2016 2017 2018B. Australia exports to world
2010 -2018
(USD Billion)WT/REG400/1 /Rev.1  
 
- 8 - 
 
  1.9.  Charts 1.5, and 1.6 depict bilateral trade in commercial services as reported by the Parties . 
Travel and transport services dominate trade between the Parties with Hong Kong China maintaining 
a trade surplus in transport services and a trade deficit in travel services with Australia.  Other key 
sectors traded are financial services and other business services.  
Chart 1. 5 Hong Kong, C hina: Bilateral trade in commercial services with Australia, 2010 -
2018 
 
Note:  Based on BPM6 . 
 No trade in commercial services for Manufacturing services on physical inputs owned by others, 
Maintenance and repair services, and Construction (2010 -2018); no trade for Charges for the use of 
intellectual property n.i.e. (imports for 2011 and no export for 2013 -2017); no export for Personal, 
cultural, and recreational services (2010 -2015, 2017 -2018).  
 Exchange rates to convert HK Dollar to US Dol lar: 2010 (7.77) 2011 (7.78) 2012 (7.76) 2013 (7.76) 
2014 (7.75) 2015 (7.75) 2016 (7.76) 2017 (7.79) and 2018 (7.84).  
Source:  Hong Kong, China authorities.  
Manufacturing services
Maintenance & repair services
Transport services
Travel servicesInsurance and pension 
services
Financial services
Charges for the use of 
intellectual property n.i.e.Telecom, computer and 
information services
Other business servicesConstruction
Personal, cultural and 
recreational services0.00.51.01.52.02.53.03.5
2010 2011 2012 2013 2014 2015 2016 2017 2018A. Hong Kong, China imports from Australia
2010 -2018
(USD Billion)
0.00.51.01.52.02.53.0
2010 2011 2012 2013 2014 2015 2016 2017 2018B. Hong Kong, China exports to Australia
2010 -2018
(USD Billion)WT/REG400/1 /Rev.1  
 
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  Chart 1.6 Australia: Bilateral trade in commercial services with Hong Kong, China, 2010 -
2018 
 
Note:  Base on BPM6.  
 No trade in commercial services for Manufacturing services on physical inputs owned by others 
(2010 -2018), Maintenance and repair services (no export for 2010 -2012, 2016 and no import for 
2013-2014), and Construction (no export for 2010 -2014, 2017 -2018 and no import for 2010 -2018), 
no import for Charges for the use of intellectual property n.i.e. (2017).  
 Exchange rates to convert Australian Dollar to US Dollar for 2017 -2018 are: 2017 (1.30) and 2018 
(1.34).  
Source:  WTO Statistics database a nd Australian authorities (2017 -2018).  
 
1.10.   Charts 1. 7 and 1. 8 below depict the Parties' bilateral  (2017 -2018) and global  (2010 -2018)  
FDI stocks and flows. While inward FDI flows to Hong Kong China have surpassed outflows since 
2015, it remained a net recipien t in terms of its global FDI stocks . Australia remained a net FDI 
recipient overall during this period . Australia was a net recipient of FDI from Hong Kong China.  
Manufacturing services on physical 
inputs owned by others
Maintenance & repair services, n.i.e.
Transport services
Travel servicesInsurance and pension 
services
Financial services
Charges for the use of 
intellectual property n.i.e.Telecom, computer and 
information services
Other business servicesConstruction services
Personal, cultural and 
recreational services0.00.51.01.52.02.53.0
2010 2011 2012 2013 2014 2015 2016 2017 2018A. Australia imports from Hong Kong, China
2010 -2018
(USD Billion)
0.00.51.01.52.02.53.0
2010 2011 2012 2013 2014 2015 2016 2017 2018B. Australia exports to Hong Kong, China
2010 -2018
(USD Billion)WT/REG400/1 /Rev.1  
 
- 10 - 
 
  Chart 1. 7 Hong Kong, China : FDI stock and flow with Australia and world  
 
Note:  Exchange rates to convert HK Dollar to US Dollar for 2017 -2018 are: 2017 (7.79) and 2018 (7.84).  
Source:  UNCTADStat and authorities of Hong Kong, China (2017 -2018).  
Chart 1. 8 Australia : FDI stock and flow with Hong Kong, China and world  
 
Note:  Exchange ra tes to convert Australian Dollar to US Dollar for 2017 -2018 are: 2017 (1.30) and 2018 
(1.34).  
Source:  UNCTADStat and Australian authorities (2017 -2018).  
0.02.04.06.08.010.012.014.016.018.020.0
2017 2018FDI stock with Australia
2017 -2018
(USD Billion ) 
-2.5-2.0-1.5-1.0-0.50.00.51.01.52.02.53.0
2017 2018FDI flow with Australia
2017 -2018
(USD Billion ) 
05001,0001,5002,0002,500
2010 2011 2012 2013 2014 2015 2016 2017 2018FDI stock with world
2010 -2018
(USD Billion )
020406080100120140160180200
2010 2011 2012 2013 2014 2015 2016 2017 2018FDI flow with world
2010 -2018
(USD Billion ) 
0.02.04.06.08.010.012.014.0
2017 2018FDI stock with Hong Kong, China
2017 -2018
(USD Billion ) 
0.00.51.01.52.02.53.0
2017 2018FDI flow with Hong Kong, China
2017 -2018
(USD Billion ) 
0100200300400500600700800
2010 2011 2012 2013 2014 2015 2016 2017 2018FDI stock with world
2010 -2018
(USD Billion )
-20-10010203040506070
2010 2011 2012 2013 2014 2015 2016 2017 2018FDI flow with world
2010 -2018
(USD Billion ) WT/REG400/1 /Rev.1  
 
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  2  CHARACTERISTIC ELEMENTS OF THE AGREEMENT  
Background information  
2.1.  The Free Trade Agreement between Hong K ong, China and Australia, hereinafter referred to as 
"the Agreement" is one of Hong Kong, China 's 7 RTAs and Australia 's 14 RTAs.6 The Agreement was 
signed on 26 March 2019. It was notified to the WTO under Article  XXIV:7(a) of the GATT 1994 and 
Article  V:7(a) of the GATS on 17 January 2020.7 The Agreement entered into force on 17 January 
2020.  
2.2.  The Parties also signed an "Investment Agreement " on 26 March 2019 which, together with 
the Agreement, they consider to be part of a wider process of economic inte gration and trade 
liberalization.  
2.3.  The text of the Agreement is available, together with its Annexes, on the following websites:  
Hong Kong, China : 
https://www.tid.gov.hk/english/ita/fta/hkaufta/index.html  
 
Australia :  
https://dfa t.gov.au/trade/agreements/in -force/a -hkfta/a -hkfta-text/Pages/default.aspx  
 
Structure of the Agreement  
2.4.  The Agreement is composed of 20 Chapters and a number of general and chapter specific 
Annexes. Side letters and associated documents complement the legal framework. Table  2.1 below 
summarizes the Agreement:  
Table  2.1 Structure of the Agreement  
Preamble  
Chapter 1  Initial provisions and general definitions and interpretations  
Chapter 2  Trade in goods  
Chapter 3  Rules of origin  and o rigin procedures  
Chapter 4  Customs procedures and trade facilitation  
Chapter 5  Technical barriers to trade  
Chapter 6  Sanitary and phytosanitary measures  
Chapter 7  Cross -border trade in services  
Chapter 8  Financial services  
Chapter 9  Telecommunications  
Chapter 10  Movement of natural persons  
Chapter 11  Electronic commerce  
Chapter 12  Establishment and related provisions  
Chapter 13  Government procurement  
Chapter 14  Intellectual property  
Chapter 15  Competition policy  
Chapter 16  Transparency  
Chapter 17  Institutional provisions  
 
6 RTAs on trade in goods and/or services notified separately to the WTO are counted as one. Source: 
RTA Information System (WTO Database on RTAs), at: http://rtais.wto.org  (viewed on 17 March 2020).  
7 WTO documents WT/REG400/N/1 and S/C/N/986.  WT/REG400/1 /Rev.1  
 
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  Chapter 18  Consultations and dispute settlement  
Chapter 19  General provisions and exceptions  
Chapter 20  Final provisions  
  
Annexes   
Annex I  Explanatory Notes and Schedules (Services and investment)   
Annex II  Explanatory Notes and Schedules (Services and investment)  
 
Side letters and associated documents  
 
 
Legal services  
 
Professional services  
 Government -owned enterprises  
 
Government procurement  
 Scope of Application  
Source:  WTO Secretariat, based on the Agreement.  
 
2.5.  The Agreement establishes a free trade area between  the Parties (Article  1.1).  
3  PROVISIONS ON TRADE IN GOODS  
3.1.  While Chapter 2 specifically refe rs to trade in goods, Chapters 3 through 6 also apply to Trade 
in goods . Moreover, Chapter 13 (Government procurements) contains disciplines applicable, 
inter alia, to trade in goods. Chapter 1 , and Chapters 1 4 through 20 contain rules applicable 
generally, and thus are also applicable to merchandise trade.   
3.1  Import duties and charges, and quantitative restrictions  
3.1.1   General provisions  
3.2.  The Parties commit to apply national treatment for all covered products in accordance with 
Article III of the GATT 1994, which is incorporated into and made part of the Agreement (Article  2.3).  
3.3.  The Agreement prohibits the adoption or maintenance of any prohibition or restriction on the 
importation of any good of the other Party or on the exportation or sale for export of any good 
destined for the other Party, except in accordance with Article XI of the GATT 1994, which is 
incorporated into and made part of the Agreement (Articles 2.6). It confirms that the Parties prohibit 
measures such as export and import price requirements8; import licensing conditioned on the 
fulfilment of a performance requirem ent; and voluntary export restraints. Moreover, neither Party 
shall adopt or maintain any non -tariff measures on the importation of any good of the other Party, 
except in accordance with its rights and obligations under the Agreement or the WTO agreement. 
With respect to import, when allowed, the need for transparency is recognized in the Agreement.  
3.4.  The Agreement refers to, borrows from , and builds on  Article VIII of the GATT 1994 (fees and 
formalities connected wi th importation and exportation) (Article 2. 5); and the WTO Agreement o n 
Import Licensing Procedures (Article 2.7) . There is a r equirement to publish online fees and charges 
imposed in connection with importation and exportation  and any information that is required to be 
publish ed under Article 1.4( a) of the WTO Agreement on Import Licensing Procedures . 
3.5.  Consultations on non -tariff measures may take place with a view to considering the scope for 
additional means to enhance the facilitation of trade in goods between the Parties (Article 2.6).  
Consultations on any proposed or actual measure on trade in goods may take place  with reference 
 
8 Such measures are prohibited except when and as permitted in enforcement of countervailing and 
antidumping duty orders and und ertakings.  WT/REG400/1 /Rev.1  
 
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  to Article 2.13  (paragraphs 2 through 4). Measures that fall within the scope of a  Chapter other than 
Chapter 2 shall be addressed through the consultation mecha nism established under that Chapter.  
3.6.  Conditional d uty-free temporary admission of g oods is governed by Article 2.9, which also 
provides that duty free treatment shall be granted for containers, pallets and packing material used 
in the international transpo rtation of goods.  
3.1.2   Liberalization of trade and tariff lines  
3.7.  Each Party agrees to eliminate all customs duties on originating goods of the other Party from 
the date of entry into force o f the Agreement (Article 2.4).  
3.1.2.1   Hong Kong, China  
3.8.  In 2020 , and based on t he HS 2017 nomenclature, Hong Kong, China's tariff consisted of 7,551 
tariff lines (at the eight -digit level). All tariff lines were duty free on an MFN basis.  
3.9.  As all products originating in Australia  are granted duty free access in Hong Kong, China , it has 
no liberalization schedule i n the Agreement .  
3.1.2.2   Australia  
3.10.   Australia 's applied tariff in 2020  consisted of 6,475  lines at the HS eight -digit level (HS  2017); 
99.9% of its tariff  has ad valorem  duties , with 9 non-ad valorem  duty lines .9 
3.11.   As all products originating in Hong Kong, China are also granted duty free access in the 
Australian market, no liberalization schedule is attached to the Agreement for Australia.  
3.12.   Table 3.1 shows  tariff elimination commitments by Australia  for imports from  Hong Kong, 
China and Table 3.2 shows Australia 's tariff elimination, by HS  section.  
3.13.   Before the entry i nto force of the Agreement (2020 ), 3,197  (eight -digit) tariff lines, 
representing 49.4% of Australia 's tariff, and corresponding to 73% of its imports fr om Hong Kong, 
China  during 201 7-2019, were duty free on an MFN basis. At the entry into force of the Agreement, 
an additional 3,278  lines ( 50.6% of the tariff) became duty -free for imports from Hong Kong, China . 
As a result, 100% of Australia 's tariff beca me duty free for imports from Hong Kong, China 
immediately at the entry into force of the Agreement .  
Table 3.1 Australia: Tariff elimination commitments under the Agreement and 
corresponding average trade  
Duty phase -out 
period  Number 
of lines  % of total lines 
in Australia's 
tariff schedule  Value of Australia's 
imports from Hong 
Kong, China  
(2017 -2019)  
USD million  % of Australia's 
total imports from  
Hong Kong, China  
2017 -2019  
MFN duty free (2020)  3,197  49.4 407.0  73.0 
2020 3,278  50.6 150.7  27.0 
Total  6,475  100.0  557.6  100.0  
Note:  Based on the HS 2017 nomenclature.  
Source:  WTO estimates based on data from the Australian authorities and the WTO -IDB. 
 
Table 3.2 Australia: Tariff elimination under the Agreement, by HS Section  
HS Section  MFN average%  Number  
of lines  Duty -free lines under the  
MFN 2020  Number of duty -free lines 
under the Agreement  
2020  
I 0.0 374 367 7 
II 0.7 321 275 46 
III 1.8 49 31 18 
 
9 5 tariff lines with specific duties and 4 lines with mixed duties.  WT/REG400/1 /Rev.1  
 
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  HS Section  MFN average%  Number  
of lines  Duty -free lines under the  
MFN 2020  Number of duty -free lines 
under the Agreement  
2020  
IV 2.9 294 140 154 
V 0.4 198 184 14 
VI 1.3 964 705 259 
VII 4.4 239 27 212 
VIII 3.4 92 29 63 
IX 3.2 179 65 114 
X 3.7 285 73 212 
XI 4.1 920 163 757 
XII 2.5 60 30 30 
XIII 3.4 167 52 115 
XIV 1.0 53 42 11 
XV 3.5 583 171 412 
XVI 2.5 1,000  497 503 
XVII 3.6 272 76 196 
XVIII 0.8 240 201 39 
XIX 1.6 19 13 6 
XX 3.5 159 49 110 
XXI 0.0 7 7  
Total  2.5 6,475  3,197  3,278  
Note:  For the calculation of averages, specific rates are excluded, and the ad valorem  parts of alternate rates 
are included.  
 Based on the HS 2017 nomenclature.  
Source:  WTO estimates based on data from the Australian authorities.  
 
3.1.3   Tariff rate quotas  
3.14.   There are no tariff rate quota  commitments in the Agreement .  
Rules of origin   
3.15.   The disciplines on rules of origin and origin procedures  are set out in Chapter 3 . 
3.16.   While Section A contains the rules of origin per se , and Annex 3 -B the product -specific rules 
of origin, Section B  sets out the origin procedures, complemented by the information to be included 
in the declaration of origin in Annex 3 -A. Section C foresees that the Parties may consult to discuss 
possible amendments or modifications to Chapter 3  and its annexes . For the purposes of the 
Agreement, a product is considered as originating in a Party if  it is: 
a. wholly obtained or produced  entirely in one or both of the  Parties by one or more producers 
as establis hed in Article 3.3 ;  
b. produced entirely in one or both of the Parties by one or more producers, exclusively from 
originating materials; or   
c. produced entirely in one or both of the Parties by one or more producers  using non -
originating materials provided tha t the good satisfies the applicable product -specific rules 
of origin in Annex 3 -B to the Agreement , and the good satisfies all other applicable 
requirements of Chapter 3.   
3.17.   According to Annex 3 -B, the product -specific rules of origin apply to goods in which  non-
originating materials are used in the production process  (Article 3.2(c)) .10 For most HS Chapters, 
the products are considered originating if they are wholly obtained or if their transformation involves 
a change in tariff classification  (CTC)  either at the level of the Chapter (2 digits), heading (4 digits), 
or sub -heading (6 digits) under the HS . For a number of industrial and some agricultural products , 
the transformed good must have a regional value content (RVC) of not less than 40%  (Articl e 3.4) .11 
 
10 The product -specific rules are formulated on the basis of the HS 2017.  
11 The RVC requirement (40%) is applicable in particular for some products, such as in HS Sections I 
(dairy products); II (vegetables and food products); IV (prepared foodstuffs, beverages); V (mineral fuels); VI 
(chemical products); VII (plastics); X (paper and printed books); XI (apparel, clothing, and made up textiles); WT/REG400/1 /Rev.1  
 
- 15 - 
 
  In most cases, for wh en an RVC is require d, it is an alternative to the CTC requirement . In some 
other cases, t he RVC is defined as a cumulative requirement together with the fulfilment of another 
criteria  (usually CTC or a manufacturing or proce ssing operation) .12 Specified manufacturing or 
processing operations  are require d for a certain number of  products13, and for  chemical products .14  
3.18.   Disciplines on the treatment of materials used in production ; the determination of the value 
of such materia ls; as well as further adjustments to that value are contained in Articles 3.5 through 
3.7. 
3.19.   Cumulation of origin is governed by the provisions of Article 3.8. Products shall be considered 
as originating in a Party if they are obtained there by incorporating materials originating in the other 
Party. The Parties also agree to meet within two years after the entry into force of the Agreement 
to review Article 3.8, particularly taking into account new approaches such as cross -cumulation.  
3.20.   Article 3.9  contains a de minimis  tolerance provision  if the value of non -originating material 
in a good does not exceed 10% of the adjusted value  as defined in the Agreement . For textiles and 
textile article under HS Chapters  50-63, the de minimis  tolerance can also  be 10% of the total weight 
of the good.  
3.21.   Disciplines o n the treatment of fungible goods or materials; accessories, spare parts, tool, 
and instructional or other information materials; packaging materials and containers for retail sale; 
packing materials a nd containers for shipment; indirect materials; and consignment are contained 
in Article s 3.10 through 3.15.  
3.22.   Section B of Chapter 3 governs origin procedures. It establishes , under Articles 3.16 through 
3.27,  rules and disciplines applicable to claims for preferential treatment, with minimum data 
requirements to be contained in a declaration of origin listed in Annex 3 -A to the Agreement; basis 
of a declaration of origin; discrepancies in the declaration of origin; waiver of declaration of origin15; 
obligat ions relating to importation; refunds and claims for preferential tariff treatment after 
importation; record keeping requirements; verification of origin; verification visit; determinations on 
claims for preferential tariff treatment; penalties for violati on of laws and regulations related to 
Chapter 3; and maintenance of the confidentiality of information collected in the process of origin 
determination.  
Export duties and charges, and quantitative restrictions  
3.23.   Export duties applicable to goods destined for  the other Party are prohibited, unless such duty 
is not in excess of that imposed on the like good destined for domestic consumption (Article 2.8).  
3.24.   The Agreement prohibits the adoption or maintenance of any prohibition or restriction on the 
exportation or  sale for export of any good destined for the other Party, except in accordance with 
Article XI of the GATT 1994. Moreover, n either Party shall adopt or maintain non -tariff measures on 
the exportation of any good destined to the other Party, except in acco rdance with its rights and 
obligations under the Agreement or the WTO agreement.  With respect to export restrictions, when 
allowed, the need for transparency is recognized in the Agreement  (Article 2.6) . 
 
XIII (glass); XIV (silver, gold, pl atinum and jewellery); XV (metals); XVI (machinery); XVII (vehicles, including 
parts for aircrafts, ships and boats); XVIII (medical and surgical instruments, clocks, musical instruments); 
and XX (furniture, toys, and miscellaneous manufactured articles).   
12 This is specifically for some vehicles under HS 8701 through 8705.  
13 This is specifically for some products under HS Chapters 08 (fruits); 09 (spices); 15 (vegetables, 
fats); and 61, 62 and 63 (textiles).  
14 Specific rules are prescribed for the followin g processes: chemical reaction; distillation, purification; 
mixtures and blends; change in particle size; standards materials; and isomer separation.  
15 For instance, with some attached conditions, in case the value of the imported goods does not exceed 
AUD 1,000 or the equivalent; or the importation of a good for which the importing Party has waived the 
declaration of origin requirement.  WT/REG400/1 /Rev.1  
 
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Regulatory provisions on trade in goods  
3.4.1   Standards  
3.4.1.1   Sanitary and phytosanitary measures  
3.25.   Chapter 6 contains disciplines on sanitary and phytosanitary measures (SPS) that are 
intended to  facilitate  trade between the Parties while protecting human, animal or plant life or health; 
promote transparency in and understanding of the application of each Party's SPS measures; 
strengthen SPS -related cooperation to facilitate trade and access to their respecti ve markets; and 
to facilitate the implementation of the  principles of the  WTO SPS Agreement  (Article 6.2). The Parties 
affirm their rights and obligations with respect to each other under the WTO SPS Agreement 
(Article  6.4). 
3.26.   The Agreement allows Parties to take emergency SPS measures on serious human, animal or 
plant life or health grounds, subject to notification and consultations if necessary (Article 6.6). It 
also refers to, respectively, Articles 4 and 6 of the WTO SPS Agr eement for the determination of 
equivalence (Article 6.7) and the adaptation of determination to regional conditions.  
3.27.   While transparency provisions address the availability of information and notification s 
regarding proposed, new or amended SPS measures (A rticle 6.5), the Parties agree to cooperate to 
facilitate the implementation of Chapter 6; to designate contact points; and to consult on any matter 
arising under Chapter 6 (Articles 6.9 through 6.11). The Agreement nevertheless clarifies that 
neither Part y shall have recourse to dispute settlement under Chapter 18 (consultation and dispute 
settlement) for any matter arising from Chapter 6 .  
3.4.1.2   Technical barriers to trade  
3.28.   Chapter 5 contains disciplines on technical barriers to trade (TBT) , which apply to all t echnical 
regulations, standards and conformity assessment procedures that may, directly or indirectly, affect 
trade in goods between the Parties. Chapter 5 excludes sanitary or phytosanitary measures, which 
are covered in Chapter 6. Purchasing specificatio ns prepared by governmental bodies for their 
production or consumption requirements are also excluded from Chapter 5 . Two Annexes contain 
specific additional TBT -related disciplines for wine (Annex 5 -A) and food products (Annex 5 -B). 
3.29.    The Parties reaffirms  their existing rights and obligations with regard to each other under the 
TBT Agreement (Article 5. 4). It provides , in Article 5 .5 for example, that international standards, 
guides and recommendations  shall be used as basis for the Parties' technical regu lations and related 
conformity assessment procedures, as appropriate and when they are effective and appropriate to 
fulfil legitimate objectives.  Positive consideration to accept as equivalent technical regulations of the 
other Party is encouraged (in acco rdance with the TBT Agreement ) (Article 5.6).  The Parties are also 
invited to give positive consideration to accepting the results of each other's conformity assessment 
procedures (Article 5.7).   
3.30.   Transparency provisions require information on new and propo sed regulations, standards and 
conformity assessment procedures be made available, including the full text within seven days of a 
request from the other Party. The Party making the notification shall endeavour to provide the other 
Party with a period of at  least 60 days in which to comment except in urgent cases.  The Party shall 
endeavour to respond to any comments on request within a reasonable period of time (Article 5.8) . 
Contact points shall be designated (Article 5.10). Opportunities for cooperation between the Parties 
are also identified in Article 5.9.  
3.31.   Article 5.11  contains rules on TBT-related consultations . Neither Party shall have recourse to 
dispute settlement under Chapter 18 (consultations and dispute settlement) for any matter ari sing 
under Chapter 5 (Article 5.12).  
3.32.   On wine, Annex 5 -A reflects the ongoing wine labelling practice and seeks to keep pace with 
the long term harmonisation for global wine trade, underlines some of the rights and obligations of 
the Parties in connection w ith labelling and the type of information that may be required on wine 
labels. The Annex also details r ules on penalties, as well as disciplines on, inter alia , labelling  of the 
minimum durability or expiration of products. On certification and classificat ion the Parties may not WT/REG400/1 /Rev.1  
 
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  require that imported wine be certified by an official certification body of or by a body recognized by 
the Party in which it is produced, regarding  the vintage, varietal or regional claims for wine  (unless 
there is a reasonable and  legitimate concern about these) ; instead any certification for health and 
safety reasons should be based on the Codex Alimentarius.16 The Parties  also agree to endeavour to 
assess their respective laws, regulations and requirements in respect of oenologic al practices, with 
the aim of reaching agreements  that provide for the mutual acceptance of their respective 
mechanisms for regulating oenological practices, if appropriate.  
3.33.   Annex 5 -B enhances transparency in the regulatory mechanism for food products and foster 
a closer government to government liaison on regulations in surveillance matters . The Parties  shall 
identify agencies that are authorised to regulate import and export of food products and manage 
food safety incidents in their respective area and make that information publicly available. The 
Parties confirm that their respective regulations of food products and the production of food product 
safety assurances are based on ri sk assessment procedures in accordance with applicable 
international standards, guides and recommendations, including those developed b y the Codex 
Alimentarius Commission. The y also agree to share information from post -market surveillance of 
food products for food products trade d between them. Consultation s are foreseen if and when a 
Party detects non -conformity of a food product from the other Party that results in a consignment 
being refused entry  and on any matter arising in trade in food products , while  collaboration through 
regional and international initiatives to improve the alignment of the Parties' respective regulations 
and regulatory activities for food products is encouraged. The Parties agree to give positive 
consideration  to accepting the equiv alence of each other's ' technical regulations and standards. They 
also may decide to negotiate recognition of their food safety systems for all or some food products  
based on relevant guidance by the Codex Alimentarius Commission .  
3.4.2   Safeguard mechanisms  
3.4.2.1   Global safeguards  
3.34.   The Parties ' rights and obligations in respect of safeguards shall be governed by Article  XIX 
of the GATT 1994 and the WTO Agree ment on Safeguards (Article 2.12 ). The Agreement does not 
confer any additional rights or obligations on either P arty for actions taken pursuant to Article XIX 
of the GATT 1994 and the WTO Agreement on safeguards.   
3.4.2.2   Bilateral safeguards  
3.35.   The Agreement does not contain disciplines on bilateral safeguards .  
3.4.2.3   Safeguard measures related to balance of payment (BOP) difficult ies 
3.36.   A Party, in serious BOP and external financial difficulties , or under threat thereof, may, in 
accordance with the conditions established under the GATT 1994 and the relevant WTO 
Understanding, adopt or maintain restrictive import  measures. Article 19.6  contains disciplines, 
partly based on relevant WTO provisions , and consistency of the Articles of Agreement of the IMF, 
for the application of BOP measures . Notification obligations are also linked to the use of such rights.   
3.4.3   Anti-dumping and countervaili ng measures  
3.37.   The Agreement confirms that Article VI of the GATT 1994 and the WTO Antidumping 
Agreement shall govern the rights and obligations of the Parties  (Article 2.10) . The Agreement does 
not confer any additional rights or obligations on either Party with regard to actions taken pursuant 
to Article VI of the GATT 1994 and the WTO Antidumping Agreement.  
3.38.   Article 2.11  confirms that the rights and obligations of the Parties relating to countervailing 
measures  shall be governed by Articles VI and XVI of the GATT 1994 and  the WTO Agreement on 
Subsidies and Count ervailing Measures . When an application for the initiation of a countervailing 
investigation against the imports from the other  Party is received by a Party it shall notify the other 
Party before the initiation of an investigation so as to provide reasonable opportunities for 
consultations with a view to finding a mutually acceptable solution. The Agreement does not confe r 
 
16 Guidelines for Design, Production, Issuance and Use of Generic Official Certificates (CAC/GL 38 -2001).  WT/REG400/1 /Rev.1  
 
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  any additional rights or obligations on either Party with regard to actions taken pursuant to Articles 
VI and XVI of the GATT 1994 and the WTO Agreement on Subsidies and Countervailing Measures.  
3.4.4   Subsidies and State -aid 
3.39.   The Agreement confirms that the rig hts and obligations of the Parties relating to subsidies 
shall be governed by Articles VI and XVI of the GATT 1994 and the WTO Agreement on Subsidies 
and Count ervailing Measures (Article 2.11 ).  
3.40.   There are no provisions on State -aid in the Agreement.  
3.4.5   Custo ms-related procedures  and trade facilitation  
3.41.   While there are a number of customs -related  provision s in other Chapters of  the Agreement , 
Chapter 4 specifically addresses customs procedures  and trade facilitation. The Parties affirm their 
rights and obligati ons with respect to each other under the WTO Agreement on Trade Facilitation 
(Article 4.4). They also agree that Article VII of the GATT 1994 and the WTO Customs Valuation 
Agreement govern the determination of the customs value of goods trade with the othe r Party 
(Article 4.5). While each Party shall ensure that its customs procedures and practices are predictable, 
consistent, transparent and shall facilitate trade, the Parties also commit to conform to international 
standards and recommended practices esta blished by the World Customs Organization, where 
possible. A periodic review of customs procedures by the customs administration of each Party shall 
take place with a view to exploring options for their simplification and the enhancement of mutually 
benefi cial arrangement to facilitate trade between the Parties (Article 4.6). Specific provisions are 
contained in Chapter 4 with respect to response to requests for advice or information ; the application 
of information technology  and the e stablishment of a sing le window system for traders  on a best 
endeavour basis ; the publication of relevant laws and regulations ; the designation of enquiry points ; 
as well as providing an  opportunity to the public to provide comments on relevant draft general laws 
and regulation s to the extent practicable (Articles 4.7, 4.8, and 4.12). Moreover, in Articles 4.9 
through 4.11, the Parties agree on the use of risk management in its customs procedures to facilitate 
the clearance of low risk goods, and a periodic review of such practi ces; the adoption and 
maintenance of simplified customs procedures for the efficient release of goods;  the maintenance  
and review of the operation of the Arrangement regarding Mutual Recognition of each Party's 
Authorised Economic Operator Systems . A review and appeal mechanism shall be available in each 
Party for administrative review and judicial review of decisions by customs administrat ions 
(Article  4.13).  
3.42.   Cooperation and consultations between the Parties are foreseen in and governed by Articles 
4.14 and 4.15. In the event that consultations fail to resolve any disagreements, the matter may be 
referred to the Joint Commission established by the Agre ement by the Party requesting 
consultations. The designation of contact points on customs procedures and trade facilitations 
matters is also foreseen .17  
4  PROVISIONS ON TRADE IN SERVICES  AND INVESTMENT  
4.1  Scope and definitions  
4.1.  Rules gove rning trade in services are found in Chapter 7 (Cross -border trade in services) , which 
covers cross -border trade in services18; Chapter 8  (Financial services) , which applies to measures 
adopted or maintained by a Party affecting trade in financial services ; Chapter 9  
(Telecommunications) , which applies to measures adopted or maintained by a Party affecting trade 
in telecommunications services; Chapter 10  (Movement of natural persons) , which apply to 
measures that affect the movement of  natural persons of a Party into the area of the other Party  in 
the categories as defined in the Agreement ; and in Chapter 12  (Establishment and related 
provisions) , which applies to measures adopted or maintained by a Party relating to investors of the 
 
17 For Hong Kong,  China, the contact point can be accessed at hk_liaison@customs.gov.hk . For 
Australia, the contact point can be accessed at origin@abf.gov.au . 
18 The definition of the term "cross -border trade in services", for the purpose of the Agreement, covers 
the supply of a service through modes 1, 2 and 4 as defined in the GATS.  
Similarly, the terms "services" and "a service supplied in the exercise of gove rnmental authority" are 
also, for the purpose of the Agreement, identical to those in the GATS.  WT/REG400/1 /Rev.1  
 
- 19 - 
 
  other Party, and covered investments . Specific Annexes complement the se disciplines. Chapter 7 
does not apply to financial services, government procurement, services supplied in the exercise of 
governmental authority and subsidies or grants provided by a Party. It also does not apply to air 
services other than aircraft repair and maintenance services; selling and marketing of air transport 
services; computer reservatio ns system services; specialty air services; airport operation services; 
and ground handling services.  
4.2.  The Schedules to Annexes I and II to Chapter 7 contain, respectively, the Parties' existing non -
conforming measures and their lists of specific sectors, s ubsectors or activities for which they may 
maintain existing, or adopt new or more restrictive non -conforming measures.  This is applicable to 
Chapter 12. Annex 8 -B contains the Parties' specific commitments on financial services.  
4.2  Denial of benefits  
4.3.  A Party  may deny the benefits of Chapter 7 (cross -border trade in services)  or of Chapter 12 
(establishment and related provisions)  to, respectively,  a service supplier , or an investor that is an 
enterprise of the other Party and to investments of that investor , if the service supplie r or enterprise 
are owned or controlled by persons of a third -party; and the denying Party adopts or maintains 
measures with respect to the third -party or a person of the third -party that prohibit transactions 
with the enterprise or t hat would be violated or circumvented if the benefits of Chapter 7 or 
Chapter  12 were accorded to the enterprise (Article s 7.11 and 12.10 ). Similar disciplines are 
applicable for financial services  (Article 8.16).  
4.3  General provisions on trade in services  
4.3.1   Market access  
4.4.  The principles in Article XVI of the GATS (paragraphs 2a through 2e) are confirmed with 
respects to market access granted by a Party to services and services providers from the other Party 
(Article 7.3).  
4.5.  Nevertheless, the existing an d future non -conforming measures listed by the Parties, on 
commitments on market access, are in Annex es I and II  to the Agreement (Article 7.7) and are 
summarized below under Section 4.4.   
4.6.  Market access specific commitments on financial services, based on  a hybrid approach (i.e. 
market access commitments are positively scheduled while other commitments are negatively 
scheduled , are in Section A  and Section B Part I  of Annex 8 -B. 
4.3.2   National and MFN treatment  
4.7.  With respect to cross -border trade in services, e ach Party shall accord to services and service 
suppliers of the other Party treatment no less favourable than that is accords, in like circumstances, 
to its own services and service suppliers (Article 7.4) and to services and service suppliers of a third -
party (Article 7. 6). The same principles apply for investment (Articles 12.4 and 12.5).  
4.8.  As to the application of national treatment for investment, the Agreement stipulates that a 
Party may adopt or maintain a measure that prescribes special formalities in con nection with a 
covered investment, such as a residency requirement for registration or that a covered investment 
be legally constituted or organised under the laws or regulations of the Party (Article 12.9). This is 
provid ing that such formalities do not m aterially impair the protections afforded by the Party to 
investors of the other Party and covered investments in accordance with Chapter 12. The provision 
of information concerning that investment solely for informational or statistical purposes may 
howev er be required by a Party.  
4.9.  Existing and future non -conforming measures listed by the Parties, for commitments on 
national and MFN treatment, are in Annexes I and II to the Agreement (Article 7.7  for cross -border 
trade in services and Article 12.8 for inves tment ), and in Section B of Annex 8 -B for financial 
services. The Parties' commitments are summarized below under Section 4.4.  WT/REG400/1 /Rev.1  
 
- 20 - 
 
  4.3.3   Commercial (local) presence  
4.10.   Neither Party shall require a service supplier of the other Party to establish or maintain a 
represen tative office or any form of enterprise, or to be resident, in its area as a condition for the 
cross-border supply of a service (Article 7.5).  
4.11.   Existing and future non -conforming measures listed by the Parties, on commitments on local 
presence, are in Annex es I and II to the Agreement (Article 7.7) and are summarized below under 
Section 4.4.  
4.3.4   Performance requirement  
4.12.   With respect to investment, neither Party shall in connection with the establishment, 
acquisition, expansion, management, conduct, operation, or sale or other disposition of a covered 
investment in its area, impose or enforce any requirement, or enforce any commitment or 
undertaking to activities identified in Article 12.6.  
4.13.   Existing and future non -conforming measures listed by the Parties, on commitments on 
performance requirements, are in Annexes I and II to the Agreement (Article 12.8) and are 
summarized below under Section 4.4.  
4.3.5   Senior management and boards of directors  
4.14.   A Party shall not require that an enterprise of that Party that is a covered investment appoint 
to a senior management position a natural person of any particular nationality  (Article 12.7) . 
Nevertheless, a Party may require that a majority of the board of dir ectors, or any committee 
thereof, of an enterprise of that Party that is a covered investment, be of a particular nationality or 
resident in the area of the Party, provided that the requirement does not materially impair the ability 
of the investor to exer cise control over its investment.  
4.15.   Existing and future non -conforming measures listed by the Parties, on senior management 
and boards of directors, are in Annexes I and II to the Agreement (Article 12.8) and in Section B of 
Annex 8 -B for financial services . The Parties' commitments are summarized below under  Section  4.4. 
4.3.6   Movement of natural persons  
4.16.   Chapter 10  on the movement of natural persons applies to measures affecting the movement 
of natural persons of a Party into the area of the other Party in severa l specified  categories of 
persons. Each Party undertakes to grant temporary entry or extension of temporary stay to natural 
persons of the other Party to the extent and on the conditions provided for in its Schedule of specific 
commitments on the movement of natural persons, in Annex 10 -A to the Agreement.  
4.17.   Australia grants  temporary entry subject to the conditions and limitations, including length of 
stay, in its Schedule under Annex 10 -A, for business visitors; intra -corporate trans ferees; 
independent exec utives; and spouses and dependants.  
4.18.   Hong Kong, China's specific conditions , for the temporary movement of natural persons, 
including duration of stay, cover business visitors; intra -corporate transferees19; installers or 
servicers; and dependants, as defi ned in Annex 10 -A. 
4.19.   Chapter 10 also contains specific provisions on transparency, including the requirement to 
establish or maintain appropriate mechanisms to respond to enquiries from interested persons 
regarding measures relating to temporary entry (Artic le 10.4).  
4.20.   Expeditious processing of application s, prompt provision of information concerning the status 
of application s, reasonable fees imposed for the processing of immigration formalities, and the 
 
19 The specific sectors and subsectors to which the commitments on intra -corporate transferees apply 
are detailed in Hong Kong, China's schedule.  WT/REG400/1 /Rev.1  
 
- 21 - 
 
  provision of  facilities for online lodgement and processing of immigration formalities are among the 
requirements and procedures listed in Article 10.5.  
4.21.   The obligations o f a Party regarding its immigration measures can only derive from Chapter  1 
(initial provisions, g eneral definitions and interpretations); Chapter 10 (movement of natural 
persons); Chapter 18 (consultations and dispute settlement)20; Chapter 20 (final provisions); and 
Article 7.10 of Chapter 7 (Cross -border trade in services: transparency).  
4.4  Liberalizat ion commitments  
4.22.   Commitments on cross -border trade in services (Chapter 7), establishment  and related 
provisions  (Chapter 12), and financial services (Chapter 8), except for market access in financial 
services, are scheduled mainly on a negative list basis so that obligations on market access 
(Articles  7.3 and 8.3); national treatment (Articles 7.4, 8.4, and 12.4); local presence (Articles 7.5); 
MFN treatment  (Articles 7.6, 8.5, and 12.5); performance requirement s (Articles 12.6); and senior 
management and b oards of directors (Articles 8.7, and 12.7) apply to all services, unless specified 
otherwise in the Parties' existing and future non -conforming measures in Annexes I and II , 
respectively. Though a negative list approach is also followed by Australia in An nex II, commitments 
on market access are nevertheless expressed through a mix of negative  and positive list s, building 
on its market access commitments under the GATS  for the latter . For financial services (Chapter 8) 
with respect to market access, a positive  list approach is used while for modes 1 and 2 the Parties 
apply a negative list approach , similar to the ir commitments for cross -border trade in services and 
establishment . Annex 8-B lists, in Section A,  the Partie s specific commitments on market access for 
financial services, while Section B of Annex 8 -B lists the non -conforming measures (existing and 
future) for national and MFN treatment, and senior management and boards of directors, for financial 
services.  
4.23.   The sub-sections below present the Parties' liberalization commitments under the Agreement. 
Following a summary of  MFN exemptions and horizontal limitations in the Agreement, Tables 4.1  
and 4.2 summarize the Parties'  specific commitments under the Agreement, by main sectors and 
subsectors, and compare them with their GATS Schedules. As different approaches are used under 
the GATS and the Agreement to schedule  commitments, it is sometimes difficult to compare these 
commitments. Improvements in existing GATS com mitments are either a reduction in the limitations 
on national treatment, additional sub -sectors in which commitments are made, and/or new 
commitments. It should however be noted that horizontal limitations in the GATS Schedules and 
MFN reservations or exe mptions in the Agreement, are excluded  from the Tables , as are mode 4 
commitments. The summaries of MFN and horizontal limitations, as well as the summary  tables, 
should be considered together with the Parties' respective Schedules of Specific Commitments and 
lists of MFN exemptions.  
4.4.1   Hong Kong, China  
4.24.   In its GATS schedule, Hong Kong, China took commitments in 68 out of 155 services sectors, 
leaving in particular education services, environmental services, and health -related and social 
services unbound.  Under the Agreement, its commitment s are improved, in part as a result of the 
use of a negative list approach for most of the sectors.  
4.4.1.1   MFN and horizontal commitments  
4.25.   Hong Kong, China  has no  MFN exemption s under the GATS . Under the Agreement, it reserves 
the right to adopt or maintain any measure that accords differential treatment to third parties  under 
any bilateral or multilateral agreement or arrangement in force or signed prior to the date of entry 
into force of the Ag reement. It also reserves the right to grant more favourable treatment to non -
parties through any bilateral or multilateral agreement or arrangement which enter s into force or is 
signed after the date of entry into force of the Agreement and involves aviat ion, fisheries, or 
maritime matte rs including salvage.  
 
20 However, a Party shall not have recourse to Chapter 18 regarding a refusal to grant temporary entry 
unless the matter involves a pattern of practice; and its natural persons affected have exhausted the remedies 
made available by the other Party regarding a particular matter.  WT/REG400/1 /Rev.1  
 
- 22 - 
 
  4.26.   Hong Kong, China's GATS Schedule does not have  horizontal  commitments  although an 
attachment on the presence of natural persons  details its additional commitments and conditions for 
the supply of servi ces through mode 4 . Under the Agreement, Hong Kong, China carves out certain 
public services (public law enforcement, ambulance services, correctional services and firefighting 
services) and certain social services established for a public purpose (in sect ors such as: health, 
education, housing, training, transport, public utilities, social security, and social welfare ) from its 
commitments on market access (Article 7.3), national treatment (Articles 7.4 and 12.4), local 
presence (Article 7.5), performance requirements (Article 12.6), and senior management and boards 
of directors (Article 12.7) .21 Horizontal limitations  are, appli ed to some or all its commitments22 for 
the acquisition or ownership of land and properties23; the privatisation, divestment, sale or other 
disposition of corporate entities, equity interest or assets in government ownership24; acquisition, 
sale or other disposition by Australian natural persons of bonds, bills, notes, or other kinds of debt 
securities or instruments issued by the Government or by a Government enterprise25; legislation 
relating wholly or mainly to taxation26; and measures affecting the presence of natural persons and 
supply of services through such presence, except as specified in Hong Kong, China's Schedule to 
Annex 10 -A.27  
4.4.1.2   Sector specific commitments  
4.27.   The following section identifies some of the main differences between Hong Kong, China's 
GATS schedule and its sector -specific commitments under the Agreement.  It should also be read in 
conjunc tion with Annexes I, II and 8 -B of the Agreement.  
4.28.   Hong Kong, China's  sector -specific commitments under the Agreement build on its GATS 
commitments. The use of the negative list approach contributes to substantially improving the 
coverage of the commitment s under the Agreement, as compared to the GATS .  
Table 4.1 Hong Kong, China : comparison between the GATS and Agreement specific 
commitments  
Sectors (CPC Classification)  GATS  
Sectoral 
Commitments  RTA 
Compared 
to GATS  Annex I  Annex II  
1. Business services      
A. Professional  Services  Partial  Improved * Partial  Partial  
B. Computer  and Related  Services  Partial  Improved * Full Full 
C. Research  and Development  Services  --- Improved * Full Full 
D. Real  Estate  Services  Partial  Improved  Full Partial  
E. Rental/Leasing  Services  without  Operators  Partial  Improved*  Partial  Partial  
F. Other  Business  Services  Partial  Improved  Partial  Partial  
2. Communication services      
A. Postal  services  --- Same  --- --- 
B. Courier  services  Partial  Improved  Full Partial  
C. Telecommunication  services  Partial  Improved  Full Partial  
D. Audiovisual  services  Partial  Improved * Full Partial  
E. Other  --- Improved * Full Full 
3. Construction and related engineering 
services      
A. General  construction  work for buildings  --- Same  --- --- 
B. General  construction  work for civil Engineering  --- Improved*  Partial  Full 
C. Installation  and assembly  work  --- Improved * Partial  Partial  
D. Building  completion  and finishing  work  Partial  Improved  Partial  Partial  
E. Other  Partial  Improved  Full Partial  
4. Distribution services      
A. Commission  agents'  services  --- Improved * Full Full 
B. Wholesale  trade services  --- Improved * Full Full 
C. Retailing  services  Partial  Improved  Full Full 
D. Franchising  --- Improved * Full Full 
 
21 Reservation II -HKC-1. 
22 Market access, national and MFN treatment, performance requirements, local presence, senior 
management and boards of directors.  
23 Reservation II -HKC-2. 
24 Reservation II -HKC-4. 
25 Reservation II -HKC-3. 
26 Reserv ation II -HKC-5. 
27 See Section 4.3.6 above.  WT/REG400/1 /Rev.1  
 
- 23 - 
 
  Sectors (CPC Classification)  GATS  
Sectoral 
Commitments  RTA 
Compared 
to GATS  Annex I  Annex II  
E. Other  --- Improved * Full Full 
5. Education al services      
A. Primary education services  --- Improved * Partial  Partial  
B. Secondary education services  --- Improved * Partial  Partial  
C. Higher education services  --- Improved * Partial  Partial  
D. Adult education  --- Improved * Partial  Partial  
E. Other education services  --- Improved * Partial  Partial  
6. Environmental services      
A. Sewage services  --- Improved * Full Full 
B. Refuse disposal services  --- Improved * Full Full 
C. Sanitation and similar services  --- Improved * Full Full 
D. Other  --- Improved * Full Full 
7. Financial services (Annex 8 -B)     
A. All insurance  and insurance -related  services  Partial  Improved  Partial  Partial 
B. Banking  and other financial  services  Partial  Improved  Partial  Partial 
C. Other  --- Same  --- --- 
8. Health related and social services      
A. Hospital services  --- Improved * Full Partial  
B. Other Human Health Services  --- Improved * Full Partial  
C. Social Services  --- Same  --- --- 
D. Other  --- Same  --- --- 
9. Tourism and travel related services      
A. Hotels  and restaurants (including catering)  Partial  Improved  Full Partial  
B. Travel  agencies  and tour operators  services  Partial  Improved  Partial  Partial  
C. Tourist  guides  services  --- Same  --- --- 
D. Other  --- Same  --- --- 
10. Recreational , cultural and sporting 
services      
A. Entertainment  services  --- Improved * Full Partial  
B. News agency services  --- Same  --- --- 
C. Libraries, archives, museums and other 
cultural services  Partial  Improved  Full Partial  
D. Sporting and other recreational services  --- Improved * Full Full  
E. Other  --- Same  --- --- 
11. Transport services      
A. Maritime Transport Services  Partial  Improved  Partial  Partial  
B. Internal Waterways Transport  --- Same  --- --- 
C. Air  Transport  Services  --- Improved * Full Partial  
D. Space  Transport  --- Same  --- --- 
E. Rail Transport  Services  --- Improved * Full Partial  
F. Road  Transport  Services  --- Improved * Full Partial  
G. Pipeline  Transport  --- Improved * Full Full 
H. Services  auxiliary  to all modes  of transport  Partial  Improved * Full Partial  
I. Other  Transport  Services  --- Same  --- --- 
12. Other services not included elsewhere  --- Improved * Full Partial  
Note:  MFN and Horizontal commitments , as well as Mode 4 commitments / limitations not considered in 
the Table.  
Partial:  Commitments subject to some limitation(s) , including through non -conforming measures (existing 
and/or future) . 
Full: Commitments not subject to limitation(s) , including through non -conforming measures (existing 
and/or future).  
---: No commitments  / unbound . 
*: New commitments in the Agreement ( full or partial, with or without limitations). "New" can, in most 
cases, be seen as "improved".  
Improved:  Overall improved commitments in the Agreement compared to the GATS.  
Same:  Identical commitments com pared to the GATS.  
Similar:  Similar commitments though possibly, in specific individual cases, with limited improvements and/or 
limited additional reservations.  
Source:  Draft Consolidated GATS Schedule of Specific Commitments ( S/DCS/W/HKG ), prepared by the 
Secretariat (in 2003) and Hong Kong, China 's Schedules annexed to the Agreement.  WT/REG400/1 /Rev.1  
 
- 24 - 
 
  4.4.1.2.1   Business services  
4.29.   Hong Kong, China's commitments under the Agreement build on its GATS commitments. 
Coverage is improved within each subsector but particula rly in computer and related services , 
partially covered under GATS but fully covered under the Agreement; research and development 
services (unbound under the GATS and fully covered under the Agreement); as well as a number of 
other business services. The level of commitments for real estate services and rental/leasing services 
without operators is similar under the Agreement  and the GATS.  
4.30.   With respect to legal services, the Parties, agree, through an exchange of letters, to meet 
within one year of the date  of entry into force of the Agreement28 with the intention of supplementing 
commitments made by Hong Kong, China on legal services with additional substantive commitments 
on mode 3.  
4.4.1.2.2   Communication services  
4.31.   While postal services , unbound under the GATS,  remain covered by a general reservation for  
future non -conforming measures , and a partial reservation for courier services,  the coverage of 
telecommunication services is improved, though Hong Kong, China reserves the possibility to restrict 
or require specifi c types of legal entity through which a service supplier may supply a service.  
Coverage is also improved for audiovisual services, with, however,  reservations for radio and 
television services, which are limited to modes 2 and 3 for certain services; and m arket access for 
author audiovisual services.  
4.32.   Chapter 9 includes s pecific disciplines for telecommunications.  
4.4.1.2.3   Construction and related engineering services  
4.33.   All sub -sectors are now covered, though with some existing and future reservations , while 
under the GATS, general construction work and installation and assembly work are unbound. General 
construction work for buildings are covered without reservations.  
4.4.1.2.4   Distribution services  
4.34.   While the whole sector is unbound under the GATS, except for retailing services which are  
partially covered, under the Agreement all subsectors are covered without any existing non -
conforming measure and/or reservation s.  
4.4.1.2.5   Educational services  
4.35.   While the  whole sector is unboun d under the GATS , it is now completely covered under the 
Agreement, though with both existing and future non-conforming measures . Reservations have been  
introduced for the provision of some educational services through commercial presence.  
4.36.   The horizontal reservation for social services established for a public purpose  nevertheless  
applies. 
4.4.1.2.6   Environmental services  
4.37.   Under the Agreement, the sector, which is entirely unbound under the GATS, is now fully 
covered with no reservation or limitation.  
4.4.1.2.7   Financial servi ces 
4.38.   Hong Kong, China broadly matches its GATS commitments in insurance and insurance -related 
services, though adjustments have been made to the extent and nature of its reservations and 
commitments  to cover for instance insurance intermediation such as bro kerage and agency as well 
as services auxiliary to insurance . The same applies to a large extent  to banking services, with some 
improved coverage for the provision and transfer of financial information, and financial data 
 
28 The Parties indicate that they have not yet met to date.  WT/REG400/1 /Rev.1  
 
- 25 - 
 
  processing and related software by  suppliers of other financial services.  Hong Kong, China's  
commitments under the Agreement shall not prevent it from adopting or maintaining non -
discriminatory measures which restrict or require specific types of legal entit ies through which a 
service supp lier may supply a service. Moreover, there is a statutory monopoly on the operation of 
stock market s in Hong Kong, China.  
4.39.   Specific disciplines on trade in financial services are in Chapter 8.  
4.4.1.2.8   Health related and social services  
4.40.   While the sector is unbound u nder the GATS, it is now covered under the Agreement, though 
with some reservations for future non -conforming measures for hospital and other human health 
services.  
4.41.   The horizontal reservation for social services established for a public purpose is however  
applicable . 
4.4.1.2.9   Tourism and travel related services  
4.42.   Tourist guide services are unbound  under the GATS . They are fully covered without any 
reservation  by the Agreement . The coverage and level of the commitments on hotels and restaurants 
as well as  for travel a gencies and tour operator services is partly expanded.  
4.4.1.2.10   Recreational, cultural and sporting services  
4.43.   While most of the sector is unbound under the GATS, under the Agreement it is now almost 
fully covered. No existing non -conforming measures are listed. However, there are some 
reservations for some entertainment services and for the provision of services through mode 1 for 
library and archives services.  Sporting and other recreational services rema in reserved.  
4.4.1.2.11   Transport services  
4.44.   The coverage of sector, largely unbound under the GATS except for a partial coverage of 
maritime transport services  and auxiliary services , is improved under  the negative list approach. 
While there are no existing non -confor ming measures, there are a number of reservations through 
future new non -conforming measures under the Agreement. This is the case for example for 
measures on cabotage transport and provision of certain port services29; internal waterways 
transport, space transport and other transport services; some air transport services; and some rail 
transport services except pushing and towing services, maintenance and repair of rai l transport 
equipment, or supporting services for rail transport services. Similar reserv ations are made with 
respect to road transport services, except freight transportation, rental services of commercial 
freight vehicles with operator, or maintenance and repair of road transport equipment; and cargo -
handling services in respect of air and r ail and storage and warehousing services in respect of air 
and rail.  
4.4.1.2.12   Other services sectors  
4.45.   Under the Agreement, Hong Kong, China reserve s the right to adopt or maintain any measure 
on services of membership organisations30, other services31, private house holds with employed 
persons32, and services provide by extraterritorial organization s and bodies .33 
 
29 The Australian maritime transport service suppliers may however have access to these port services 
on a non -discriminatory basis.  
30 CPC 95.  
31 CPC 97. Th is reservation does not apply to spa services provided through modes 2 and 3 (CPC 9702).  
32 CPC 98.  
33 CPC 99.  WT/REG400/1 /Rev.1  
 
- 26 - 
 
  4.4.2   Australia  
4.46.   In the GATS, Australia took commitments in 103 out of 155 services sectors. It did not make 
commitments, inter alia , on certain specific business services; postal and courier services, as well 
as audiovisual services; some education services (primary and adult education services); sanitation 
and similar services; hospital and social services; entertainment services and  libraries, archives, 
museums and other cultural services; and internal waterways, space and rail transport services.  
4.47.   Under the Agreement, as a negative list approach is chosen, as a principle, all the sectors are 
covered, though a number of non -conforming measures are listed in Annex I to the Agreement. 
Moreover , though a negative list approach is also followed in Annex II, commitments on market 
access use a mix ed negative and positive list approach, building on Australia's market access 
commitments under the GATS.  With respect to commitments on financial services, as it is the case 
for Hong Kong, China, Australia use s a positive list approach for market access commitments and a 
negative list approach for national and MFN treatment, and senior management and boards of 
directors. The coverage of its commitments under the Agreement is expanded to sectors and 
subsectors that are unbound under the GATS. This is in particular the case for some communication 
services (postal and courier services); adult education services; hospital and social services; some 
recreational services; and some transport services (in particular space t ransport and rail transport 
services). The degree of expansion is however impacted by the introduction of two relatively broad 
horizontal carve -outs to exclude cultural industries (covering for instance audiovisual services as 
well as museum, archives, and  cultural services) and public and social services (covering for instance 
some education services, aspects of health and social services; as well as some public transport 
services).  
4.4.2.1   MFN and horizontal commitments  
4.48.   Under the GATS, Australia scheduled MFN exe mptions for audiovisual services  cover ing co-
production and/or actions taken to respond to any unreasonable measures imposed on Australian 
services or service suppliers by another WTO Member. Under the Agreement, reservations are made 
with respect to exist ing measures for some professional services (to cover citizenship requirement s 
also including  New Zealand nationals). The right to maintain or introduce MFN inconsistent measures 
is also reserved for the acquisition of agricultural land or agribusiness; th e provision of services 
covered by the social services for public purpose s carve -out; and primary education  services . 
Through a broad cultural industry  carve -out, and as under the GATS, Australia maintains  MFN non -
conforming measures that might be taken in  the audiovisual sector. Under the Agreement, Australia 
also reserves the right to adopt or maintain any measures that accord more favourable treatment 
to service suppliers or investors of third -parties under any bilateral or multilateral international 
agreement in force or signed prior to the date of entry into force of the Agreement , especially  the 
Australia – New Zealand Closer Economic Relations Trade Agreement, and favourable treatment that 
may be granted to service suppliers or investors of Pacific Is land Forum member State . It moreover 
reserves the right to derogate from the MFN principle for advantages that might be granted under 
any future bilateral or multilateral international agreement involving aviation, fisheries, or maritime 
matters, including salvage.  
4.49.   Under the GATS, Australia has horizontal reservations for establishment (mode 3) and  in 
connection with the Foreign Acquisitions and Takeovers Act of 1975. Some residency requirements 
are also listed and preferential measures in favour of indigenous persons or organisations are 
unbound.34 Under the Agreement, Australia replicates most of these reservations, though it 
improve s specific commitments on mode 4 ( Annex 10 -A). While the coverage of commitments is 
expanded through the negative listing approach, Australia also introduces horizontal reservations to 
cover preferences for indigenous p ersons35 or organization s; the acquisition of commercial  land; the 
devolution to the private sector of services provided in the exercise of Governmental authority at 
the time the Agreement entered into force ; and the privatisation of Government owned entit ies or 
assets . There are reservations for a  number of existing measures on establishment involving 
authorization requirements for certain types of investments.  The above -mentioned social services 
carve -out and the cultur al services carve -out also apply hor izontally. Australia moreover  reserves 
the right to adopt or maintain and to add to its Schedule in Annex I (existing measures) any 
non-conforming measure at the regional level of government that existed on 1 January 2005 but 
 
34 Mode 4 commitments and reservations are handled in a separate section of this factual presentation.  
35 The term "indigenous" covers Aboriginal and  Torres Strait Islander peoples.  WT/REG400/1 /Rev.1  
 
- 27 - 
 
  was not listed at the date of entry into force of the Agreement. Residency requirements are listed 
as existing non -conforming measures  at the national level for establishment and related provisions 
and at the sub -national level for both cross -border trade in services and establishment and related 
provisions. For co -operatives  a registered office in Australia is also required . Limited partnerships or 
incorporated limited partnerships must have an office, principal office or registered office in a State 
or Territory to provide services. A  promote r of a third -party "trading scheme" must maintain an 
office in Australia.  
4.4.2.2   Sector specific commitments  
4.50.   The following section identifies some of the main differences, by sector, between Australia's 
GATS schedule and its sector -specific commitments under the Agreement. It should also be read in 
conjunction with Annex es I, II and 8 -B of the Agreement.  
Table 4.2 Australia: comparison between the GATS and Agreement specific commitments  
Sectors (CPC Classifi cation)  GATS  
Sectoral 
Commitments  RTA 
Compared 
to GATS  Annex I  Annex II  
1. Business services      
A. Professional  Services  Partial  Improved  Partial  Full 
B. Computer  and Related  Services  Partial  Improved  Full Full 
C. Research  and Development  Services  Partial  Improved  Partial  Full 
D. Real  Estate  Services  Partial  Improved  Partial  Full 
E. Rental/Leasing  Services  without  Operators  Partial  Improved  Full Full 
F. Other  Business  Services  Partial  Improved  Partial  Full 
2. Communication services      
A. Postal  services  --- Improved*  Partial  Partial  
B. Courier  services  --- Improved*  Partial  Partial  
C. Telecommunication  services  Partial  Similar  Partial  Full 
D. Audiovisual  services  --- Similar  Partial  --- 
E. Other  --- Improved*  Full Full 
3. Construction and related engineering 
services      
A. General  construction  work for buildings  Partial  Same  Full Partial  
B. General  construction  work for civil Engineering  Partial  Same  Full Partial  
C. Installation  and assembly  work  Partial  Same  Full Partial  
D. Building  completion  and finishing  work  Partial  Same  Full Partial  
E. Other  --- Improved*  Full Full 
4. Distribution services      
A. Commission  agents'  services  Partial  Similar  Partial  Full 
B. Wholesale  trade services  Partial  Similar  Partial  Full 
C. Retailing  services  Partial  Similar  Partial  Full 
D. Franchising  Full Same  Full Full 
E. Other  --- Improved*  Full Full 
5. Education services      
A. Primary education services  --- Similar  Full --- 
B. Secondary education services  Partial  Similar  Full Partial  
C. Higher education services  Partial  Similar  Full Partial  
D. Adult education  --- Similar  Full --- 
E. Other education services  Partial  Similar  Full Partial  
6. Environmental services      
A. Sewage services  Full Same  Full Full 
B. Refuse disposal services  Full Same  Full Full 
C. Sanitation and similar services  Full Same  Full Full 
D. Other  --- Improved*  Full Full 
7. Financial services (Annex 8 -B)     
A. All insurance  and insurance -related  services  Partial  Improved  Partial  Full 
B. Banking  and other financial  services  Partial  Improved  Partial  Full 
C. Other  --- Similar  --- ---  
8. Health related and social services      
A. Hospital services  --- Similar  Partial  --- 
B. Other Human Health Services  Partial  Similar  Partial  --- 
C. Social Services  --- Similar  Partial  --- 
D. Other  --- Similar  Partial  Partial  
9. Tourism and travel related services      
A. Hotels  and restaurants (including catering)  Full Same  Full Full 
B. Travel  agencies  and tour operators  services  Partial  Improved  Full Full 
C. Tourist  guides  services  Full Same  Full Full 
D. Other  --- Improved*  Full Full WT/REG400/1 /Rev.1  
 
- 28 - 
 
  Sectors (CPC Classifi cation)  GATS  
Sectoral 
Commitments  RTA 
Compared 
to GATS  Annex I  Annex II  
10. Recreational and cultural and sporting 
services      
A. Entertainment  services  --- Improved  Partial  Partial  
B. News agency services  Full Same  Full Full 
C. Libraries, archives, museums and other 
cultural services  --- Similar  Full --- 
D. Sporting and other recreational services  Partial  Improved  Partial  Full 
E. Other  --- Improved*  Full Full 
11. Transport services      
A. Maritime Transport Services  Partial  Similar  Partial  Partial  
B. Internal Waterways Transport  --- Improved*  Full Partial  
C. Air  Transport  Services  Partial  Similar  Partial  Partial  
D. Space  Transport  --- Improved*  Full Full 
E. Rail  Transport  Services  --- Improved*  Full Full 
F. Road  Transport  Services  Partial  Similar  Partial  Full 
G. Pipeline  Transport  Full Same  Full Full 
H. Services  auxiliary  to all modes  of transport  Partial  Improved  Full Full 
I. Other  Transport  Services  --- Improved*  Full Full 
12. Other services not included elsewhere  --- Improved*  Full Full 
General Note:  MFN and Horizontal limitations, as well as Mode 4 commitments / limitations not considered 
in the Table.  
Partial:   Commitments subject to some limitation(s), including through non -conforming measures 
(existing and/or future).  
Full:  Commitments not subject to limitation(s), including through non -conforming measures (existing 
and/or future).  
---:  No commitments / unbound.  
*:  New commitments under the Agreement (Full or partial, with or without limitations). "New" can, 
in most cases, be seen as "improved".  
Improved:  Overall improved commitments under the Agreement compared to the GATS.  
Same:   Identical commitment as under GATS.  
Similar:   Similar commit ments though possibly, in specific individual cases, with limited improvements 
and/or limited additional reservations.  
Source:  Draft Consolidated GATS Schedule of Specific Commitments (S/DCS/W/AUS), prepared by the 
Secretariat (in 2003) and Australia's Sch edules annexed to the Agreement.  
 
4.4.2.2.1   Business services  
4.51.   There are n o reservation s for new measures that Australia may take in the future, except if 
preferential treatment involving fisheries  supporting services  are granted through future bilateral 
agreements with third parties . However, there are several  existing non -conforming measure s, 
essentially related to residency or registration requirements, for some professional services; 
research and development services; real estate services, fishing and pearling services; mining and 
related services; and other business services . Additional m arket access commitments, compared to 
the GATS, are made for some of the following sub -sectors: research and development services; 
rental and leasing services without operators; and other business services (technical testing; 
services incidental to manufac turing; maintenance and repair of equipment; and packaging 
services). Overall , Australia improves the coverage of its commitments  compared to the GATS , 
inter alia, by using a negative list. This is the case for computer and related services and rental and 
leasing services without operators, for which it has full commitments without limitations under the 
Agreement.  
4.52.   With respect to legal services, the Parties, agree, through an exchange of letters, to me et 
within one year of the date of entry into force of the Agreement36 with the intention of supplementing 
commitments made by Hong Kong, China on legal services with additional substantive commitments 
on mode 3 . 
 
36 The Parties indicate that they have not yet met to date.  WT/REG400/1 /Rev.1  
 
- 29 - 
 
  4.4.2.2.2   Communication services  
4.53.   Partial commitments a re made in the Agreement for postal and courier services, which are 
unbound under the GATS . The Chapter on cross -border trade in services includes the usual (GATS) 
carve -out for services supplied in the exercise of governmental authority  (e.g. Australia Po st), and 
the agreement does not include any sector -specific commitments market access on delivery services . 
With respect to telecommunication services, restrictions under the GATS are, in essence, mirrored 
by the Agreemen t. While audiovisual services  are unbound under the GATS , they  are, under the 
Agreement, subject to a number of limitations and conditional specific commitments forming part of 
a broad carve -out covering cultural industries.  
4.54.   Chapter 9 has s pecific disciplines on telecommunications.  
4.4.2.2.3   Constr uction and related engineering services  
4.55.   As under the GATS, full commitments without limitation s are made  for modes 2 and 3  while 
mode 1 remains unbound, with respect to market access.  
4.4.2.2.4   Distribution services  
4.56.   As a result of using a negative list approach, cov erage under the Agreement is exp anded, as 
compared to under the GATS. Reservations on the distribution of firearms, liquor, tobacco, and wine  
are however maintained .  
4.4.2.2.5   Educational services  
4.57.   Australia's  reservation of its right s to adopt or maintain any measu re on the supply of 
education services through commercial presence reflects the differen ce in i ts approach to scheduling 
commitments on education services  under the Agreement and the  GATS. The broad public services 
carve -out cover s public education and training. Moreover, in the introductory notes to Australia's 
Schedule attached to Annex II, it is clarified that nothing in Chapter 7 (cross -border trade in services) 
or Chapter 12 (est ablishment and related provisions) shall interfere with the ability of individual 
education and training institutions to maintain autonomy in admissions policies, in setting tuition 
rates and in the development of curricula or course content. Provisions on  autonomy of accreditation, 
quality assurance procedures for institutions and their programmes; the pursuit of government 
funding, subsidies or grants; or compliance with requirements on the establishment and operation 
of a facility in a particular jurisdi ction are also contained in these introductory notes.   
4.4.2.2.6   Environmental services  
4.58.   As under the GATS, full commitments are made without limitation. The coverage under other 
environmental services is moreover exp anded without limitation, of remediation and clean -up of soil 
and water; noise and vibration abatement; protection of biodiversity and landscape; and other 
environmental and ancillary services.  
4.4.2.2.7   Financial services  
4.59.   Australia's commitments under the Agreement are largely based upon its GATS commitments. 
While existing and future  non-conforming measures are listed in Section B of Annex 8-B Australia's 
commitments , Section A of Annex 8 -B lists  its market access limitations and conditions. Prudential 
regulations apply and Australia reserves the right to require the registration or authorisation of 
cross-border financial service suppliers of Hong Kong, China and of financial instruments . Under the 
Agreement, Australia reserves the right to maintain and to add to Section B of its Schedule any non -
conforming measure  at the regional level of government that existed on 1 January 2005 but was not 
listed in the Schedule at the date of the entry into force of the Agreement. This reservation applies 
for obligations on national and MFN treatment, and senior management and b oards of directors. 
Market access restrictions are based on  a positive list approach, while a negative list approach is 
used for  national and MFN treatment, and senior management and boards of directors' obligations . 
Australia reserves the right to adopt or maintain any measure for guarantee s by Government of 
Government -owned entities whose operations include the provision of financial services, including 
guarantees related to the privatisation of such entities.   WT/REG400/1 /Rev.1  
 
- 30 - 
 
  4.60.   With respect to insurance and insurance -related services, market access restriction s are 
maintained  for modes 1 and 2 with specific conditions for insurance of risks relating to maritime 
shipping, commercial aviation, and space launching and freight; reinsuran ce and retrocession; 
insurance intermediation; and services auxiliary to insurance.  As under the GATS, r estrictions are 
also maintained  in some provinces or territories , by way of monopolies or licensing provisions and 
associated controls on premiums and o ther terms of policies  for compulsory third -party motor vehicle 
accident and workers compensation. Approval of non -resident life insurers is also restricted to 
subsidiaries incorporated under Australian law.  
4.61.   With respect to banking and other financial ser vices (excluding insurance), s pecific limitations 
are set under the Agreement for the provision of certain services through mode 1. Moreover, there 
are existing non -conforming measures for market access for some banking services under the 
Agreement, in par ticular in relation to  offering services to Australian enterprises; raising funds in 
Australia through the issue of debt securities under certain conditions; authorisation to undertake 
banking business as a deposit -taking institution, and related -condition s; the coverage of liabilities 
of the previously Commonwealth Government -owned banks by transitional guarantee 
arrangements; some local requirements applicable (at provincial level) in relation to the provision 
of credit, debt collection or operation as a finance broker, as well as in the context of operation by 
second -hand dealer or pawnbroker.   
4.4.2.2.8   Health related and social services  
4.62.   While all health -related  sub-sectors are covered by virtue of the negative list approach, the 
public service carve -out cover s any measure with respect to health and childcare , thus essentially 
offering a similar level of coverage as under the GATS.  
4.4.2.2.9   Tourism and travel related ser vices  
4.63.   Australia's commitments under the Agreement, offering full and unrestricted  coverage , 
expands the coverage of its GATS commitments.  
4.4.2.2.10   Recreational, cultural and sporting services  
4.64.   Australia builds on its GATS commitments, improves its coverage in particular for 
entertainment services, sporting and other recreational services , though with some restrictions . It 
nevertheless has limitation s on gambling and betting related services. The  broad carve -out 
applicable to cultural industries also covers libraries, archives, museums and other cultural services.  
4.4.2.2.11   Transport services  
4.65.   While replicating some of the limitations in its GATS Schedule and expanding the coverage of 
specific commitments th rough the negative list approach, Australia improves the scope and depth 
of its commitments as compared to under the GATS. This is the case in particular  for space  and rail  
transport. Specific  existing non -conforming measures are registered for some maritime transport 
services (shipping for instance), the provision of some airline services, and some activities connected 
to road transport (taxi s in particular).  Additional m arket access commitments, as compared to the 
GATS, are made in some of the  following sectors/sub -sectors: some maritime transport services; 
some air transport services, including ground handling services and airport operation services; rail 
transport services;  and rental of commercial vehicles with operator . Maritime cabotage is  completely 
excluded and a general reservation is made for vessel registration, investment in activities of federal 
airports, matters covered by existing bilateral agreements with third parties  and/or future 
agreements that may be concluded on maritime mat ters, including salvage. Moreover, the broad 
public services carve -out also covers public transport.   
Regulatory provisions  
4.5.1   Domestic regulation  
4.66.   Article 7.8 builds on Article VI of the GATS. While it reaffirms that e ach Party shall ensure that 
the measures  of general application affecting trade in services are administered in a reasonable, 
objective and impartial mann er; it also replicates the GATS disciplines on maintaining judicial, WT/REG400/1 /Rev.1  
 
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  arbitral or administrative tribunals or procedures to provide for review of, and appropriate remedies 
for, administrative decisions affecting trade in services.  
4.67.   The Agreement contains detailed rules on requirements for authorisation for the supply of a 
service, including rules on authorisation fees and transparency requirement s. It also provides for 
disciplines on licensing or qualification requirements and procedures in place domestically to assess 
the competency of professionals.  
4.68.   Qualification requirements and procedures, technical standards, and licensing requirements 
and p rocedures shall not constitute unnecessary barriers to trade in services and the Agreement 
establishes some guidelines in that regard.  
4.69.   Moreover, a review is foreseen by the Agreement if the results of the negotiations  on 
paragraph 4 of Article VI of the G ATS enter into effect. Furthermore, n on-conforming measures are 
registered  with respect to most disciplines on domestic regulation .  
4.70.   The Parties shall also encourage their competent authorities to adopt technical standards that 
are developed through open a nd transparent processes. Anybody  designated to develop technical 
standards shall be encouraged to use open and transparent processes.  
4.5.2   Recognition  
4.71.   Article 7.9 contains specific provisions on the recognition of education or experience obtained, 
requirements met, or licences or certifications granted . It prescribes, inter alia, that  such recognition 
may be granted upon agreement  or arrangement with the Party or t hird-party concerned  or 
otherwise be accorded autonomously.  
4.72.   Where a Party recognizes, by agreement or arrangement, the education or experience 
obtained, requirements met, or licences or certifications granted in a third -party, that Party shall 
afford the o ther Party adequate opportunity to negotiate its accession to such agreement or 
arrangement, whether existing or future, or to negotiate a comparable agreement or arrangement 
with it. Where a Party accords recognition autonomously, it shall afford adequate  opportunity for the 
other  Party to demonstrate that the education or experience obtained, requirements met, or licences 
or certification granted in the other Party, should also be recogni zed.  
4.73.   Recognition shall not be accorded in a manner that would const itute a means of discrimination 
between the other Party and third parties .  
4.74.   With a view to endeavour to facilitate trade in professional services, in Annex 7 -A to the 
Agreement, the Parties agree on common disciplines, related to the use of business names;  and the 
promotion of the mutual recognition of, and the improved mobility of professional competence in 
engineering and architecture .37 The Annex also contain s a rendez -vous clause for the Parties to meet 
within two years after the date of entry into forc e of the Agreement to facilitate the fulfilment of the 
objectives of Annex 7 -A and determine the future direction of possible work between the Parties.  
4.5.3   Subsidies  
4.75.   Subsidies or grants provided by a Party are excluded from the coverage of Chapters 7 (cross -
border trade in services), 8 (financial services), and 12  (establishment and related provisions) . The 
terms subsidies or grants cover government -supported loans, guarantees and insurance. It also 
refers to any conditions attached to the receipt of subsidies  or grants, whether or not such subsidies 
or grants are offered exclusively to domestic service consumers or service suppliers.   
4.5.4   Safeguards  
The Parties  agree that, in the case of trade in services, they may adopt or maintain restrictions on 
payments  (balan ce of payments, bop ), or transfers related to trade in services.  Article 19.6 contains 
 
37 In that context, reference is made to the APEC Engineer and APEC Architect frameworks.  WT/REG400/1 /Rev.1  
 
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  disciplines, partly based on WTO relevant provisions for the application of BOP provisions. 
Notification obligations are also linked to the use of such rights.  
4.5.5   Other  
4.5.5.1   Transparency  and cooperation  
4.76.   Specific transparency provisions, such as for responses to enquiries or advance notices and 
opportunities for comments, are contained in Article 7.10, with respect to cross -border trade in 
services. Each Party shall also design ate one or more contact points to facilitate communication 
between the Parties on matters covered by Chapter 7 (Article 7.14).  
4.77.   The Parties commit to endeavour to cooperate on issues covered in Chapter 7. They also 
agree to strengthen cooperation in educat ion eservices, as set out in Annex 7 -B. 
4.6  Sector specific provisions on trade in services  
4.6.1    Financial services  
4.78.   Chapter 8  contains additional disciplines on trade in financial services. It applies to measures 
adopted or maintained by a Party affecting trade in  financial services, including all insurance and 
insurance -related services, and all banking and other financial services (excluding insurance), as 
listed in  Annex 8 -A to the Agreement .38 It however does not apply to  Government procurement 
(covered by Chap ter 13);  subsidies or grants (see also Section 4.5.3 above); activities conducted 
by a central bank or monetary authority or any other public entity in pursuit of monetary or exchange 
rate policies; activities forming part of a statutory system of social s ecurity or public retirement 
plans; or other activities conducted by a public entity for the account or with the guarantee or using 
the financial resources of a Party.  
4.79.   There are p rovisions on market access (Article 8.3); national treatment (Article 8.4); most-
favoured -nation treatment (Article 8.5); and special formalities and information requirements  
(Article 8.6), including formalities in connection with the supply of services through commercial 
presence, such as residency requirement for registration, or  requirements related to the form of 
legal constitution or organisation . Article 8.7 establishes the conditions applicable with respect to 
the appointment of senior management and boards of directors.  
4.80.   The existing and future non -conforming measures listed by the Parties, for commitments on 
national and MFN treatment, and senior management and boards of directors are contained , in part,  
in Annexes I and II to the Agreement , and in part in the specific schedules of financial services 
commitments in Annex 8 -B. The Parties' commitments on financial services are summarized above 
in Section 4.4.  
4.81.   Chapter 8 also stipulates that the Parties shall allow the supply of electronic payment services; 
though the re may be requirements for  the cross -border supply of electroni c payment services. A 
Party may nevertheless adopt or maintain measures for public policy purposes (Article 8.9).  Chapter 
8 also contains specific provisions governing effective and transparent regulation in the financial 
services sector; expedited availab ility of insurance; financial services new to the area of a Party; 
self-regulatory organisations; performance of back -office functions; and payment and clearing 
systems (Articles 8.10 through 8.15). It provides for denial of benefits and obligations for permitting 
payments and transfers (Articles 8.16 and 8.17). There are also p rovisions allowing Parties to protect 
the disclosure of confidential information; consultations regarding any matter arising under the 
Agreement that affects financial services; and requesting the Parties to designate one or more 
contact points to facilitate communication between the m on any matter covered by Chapter 8 
(Articles 8.18, 8.21, and 8.22).  
4.82.   Notwithstanding these  provisions, a Party shall not be prevented from adopting or maintaining 
reasonable measures for prudential reasons, including for the protection of investors, depositors, 
policy -holders, or persons to whom a fiduciary duty is owed by a financial service s upplier ; or the 
 
38 Annex 8 -A identifies insurance and insurance -related services; and banki ng and other financial 
services as it is defined in the Annex on financial services, attached to the GATS.  WT/REG400/1 /Rev.1  
 
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  maintenance of the safety, soundness, integrity or financial responsibility of financial services 
suppliers , or for ensuring the integrity and stability of a Party's financial system.  Such measures 
shall not be used as a means of avoiding t he Party's commitments or obligations under the provisions 
of Chapter 8 . Recognition of prudential measures of a Party or of a third -party is encouraged and 
governed by Article 8.20.  
4.6.2   Telecommunications  
4.83.   Chapter 9  contains additional disciplines on telecomm unications , which apply to measures 
adopted or maintained by a Party affecting trade in telecommunications services . It does not apply 
to measures relating to broadcast or cable distribution of radio or television programming in general. 
However, the provi sions of Article 9.4 (access to public telecommunications services) apply to a 
cable or broadcast service suppliers' access to an d use of public telecommunications services, and 
the provisions on transparency (Article 9.9) apply to any technical measure to  the extent that the 
measure also affect telecommunications services. Chapter 9 does not apply to any measures relating 
to private telecommunications networks or services. It does not however prohibit a Party from 
requiring an enterprise to obtain a licenc e to supply any telecommunications service within its area.  
4.84.   Most of the provisions are based on  and build on  the GATS Annex on telecommunications 
complemented by the Reference paper developed by the Negotiating Group on Basic 
Telecommunications. Chapter 9 covers  topics such as approaches to regulation; access to an d use 
of public telecommunications services; interconnection; telecommunications regulatory body and 
government ownership; technology choice; licensing; t ransparency; unbundling of network 
element s; treatment by major suppliers; competitive safeguards; international submarine cable 
systems; universal services; and allocation and use of scarce resources (in Articles 9.3 through 
9.17) . Disciplines on international mobile roaming are contained in Arti cle 9.17.  
4.85.   In relation to dispute settlement, further to the provisions applicable to cross -border trade in 
services in general applicable to administrative proceedings, review and appeal, and transparency, 
each Party shall ensure that recourse to a teleco mmunications regulatory body or other competent 
authority of the Party is possible for enterprises in order to resolve disputes regarding the matters 
covered in Chapter 9. Moreover, the Parties shall also ensure that, if a telecommunications 
regulatory bod y declines to initiate any action on a request to resolve a dispute, it shall, upon 
request, provide a written explanation for its decision within a reasonable period of time. 
Furthermore, telecommunications services' suppliers that have requested intercon nection with a 
major supplier in the area of a Party may seek review by a Party's telecommunications regulatory 
body or other competent authority to resolve disputes regarding the terms, conditions and rates for 
interconnection with that major supplier (Ar ticle 9.18).  
4.86.   The Parties agree to designate contact points to facilitate communication between the m on 
any matter covered by Chapter 9 .  
4.6.3   Education services  
4.87.   In Annex 7 -B, the Parties agree to strengthen their cooperation in education services. They 
identif y areas  like quality assurance processes; recognition of qualifications; online education, 
distance education and blended learning models; as well as  any other area of cooperation in 
education which may be mutually determined.  They further identify differe nt ways to achieve such 
encouraged cooperation.  
4.6.4   Air services  
4.88.   Chapter 7 on cross -border trade in services does not apply to air services, including domestic 
and international air transportation services, or to regulated services in support of air services, other 
than aircraft repair and maintenance services; selling and marketing of air transport services; WT/REG400/1 /Rev.1  
 
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  computer reservation system services; speciality air services39; airport operation services40; and 
ground handling services .41 Under the GATS only aircraft repair and maintenance services, the 
selling and marketing of air transport services, and computer reservation system services were 
covered.   
4.89.   In the event of any inconsistency between Chapter 7 and a bilateral, plurilateral or  multilateral 
air services agreement to which the Parties are party, a Party may invoke the dispute settlement 
procedures established in Chapter 18 (consultations and dispute settlement) only after any dispute 
settlement procedures in the other agreement h ave been exhausted.  
4.90.   the Parties agree that, if the Annex on Air Transport Services to GATS is amended, they shall 
jointly review any new definitions with a view to aligning the definitions in the Agreement with those 
definitions, as appropriate.  
Investment  
4.91.   While Chapter 7 does not cover mode 3 (commercial presence), Chapter 12 (on establishment 
and related provisions) applies to measures adopted or maintained by a Party relating to investors42 
of the other Party; and covered investments. Chapter 1 2 applies to any person when it exercises 
any governmental authority delegated to it by a Party. It however does not apply to subsidies or 
grants (see also Section 4.5.3 above); government procurement (covered by Chapter  13); or any 
act or fact that took p lace or any situation that ceased to exist before the date of entry of the 
Agreement. Measures covered by Chapter 8 (on financial services) are also excluded from the 
coverage of Chapter 12.  
4.92.   Chapter 12 contains provisions on national treatment (Article 12. 4); most -favoured -nation 
treatment43 (Article 12.5) ; performance requirements (Article 12.6), including forced transfer of 
technology though certain situations remain reserved44, or achievement of a given level of domestic 
content. Article 12.7 establishes  the conditions applicable to the appointment of senior management 
and boards of directors.  
4.93.   The existing and future non -conforming measures of the Parties, with respect to commitments 
on national and MFN treatment, performance requirements, and senior mana gement and boards of 
directors are contained in Annexes I and II to the Agreement (Article s 12.4, 12.5, 12.6 and 12.7 ) 
and are summarized above under Section 4.4.  Amongst others, the higher monetary  thresholds for  
investment screening applicable to investm ents by Hong Kong investors are also set out in An nexes  I 
and II of Australia 's Schedules of Commitments (Annex I -AU-1 and Annex II -AU-6). 
 
39 Under the Agreement, "specialty air services" means any specialised commercial operation using an 
aircraft whose primary purpose is not the transpo rtation of goods or passengers, such as aerial fire -fighting, 
flight training, sightseeing, spraying, surveying, mapping, photography, parachute jumping, glider towing, 
helicopter -lift for logging and construction, and other airborne agricultural, industri al and inspection services.  
40 Under the Agreement, "airport operation services" means the supply of air terminal, airfield and other 
airport infrastructure operation servicers on a fee or contract basis. Airport operation services do not include 
air naviga tion services.  
41 Under the Agreement, "ground handling services" means the supply at an airport, on a fee or contract 
basis, of the following services: airline representation, administration and supervision; passenger handling; 
baggage handling; ramp servi ces; catering (except the preparation of the goof); air cargo and mail handling; 
fuelling or an aircraft; aircraft servicing and cleaning; surface transport; and flight operations, crew 
administration and flight planning. Ground handling services do not in clude self -handling; security; line 
maintenance; aircraft repair and maintenance; or management or operation of essential centralised airport 
infrastructure, such as de -icing facilities, fuel distribution systems, baggage handling systems and fixed intra -
airport transport systems.  
42 Under the Agreement, "investors" means a Party, a natural person of a Party or an enterprise of a 
Party, that attempts to make, is making, or has made an investment in an area of the other Party. An investor 
of a third -party mea ns, with respect to a Party, an investor that attempts to make, is making, or has made an 
investment in the area of that Party, that is not an investor of a Party.  
43 The provisions contained in Article 12.5 shall not apply to any measure that falls within Article 5 of 
the TRIPS Agreement, or an exception to, or derogation from, the obligations which are imposed by Article 
14.6 (Intellectual Property: national treatment), or Article 4 of the TRIPS Agreement.  
44 See paragraphs 4(a) and 4(b) of Article 12.6.  WT/REG400/1 /Rev.1  
 
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  4.94.   In the event of inconsistency between Chapter 12 and another Chapter under the Agreement, 
the other Chapter shall prevail to the extent of the inconsistency (Article 12.3).  
4.95.   Nothing in Chapter 12 shall be construed to prevent a Party from adopting, maintaining or 
enforcing any measure otherwise consistent wit h Chapter 12 that i t considers appropriate to ensure 
that investment activity in its area is undertaken in a manner sensitive to environmental, health or 
other regulatory objectives (Article 12.11).  
4.96.   When the Parties notified the Agreement, they indicated that they had also signed an 
associated "Investment Agre ement " and that the two agreements are an integral part of a wider 
process of economic integration and trade liberalization.  
4.97.   The Investment Agreement updates the 1993 Agreement between the Government of 
Australia and the Government of Hong Kong for the Pro motion and Protection of Investments (the 
1993 Agreement). It contains provisions to protect  the Parties investors  and an Investor -State 
Dispute Settlement (ISDS) mechanism.  
5  GENERAL PROVISIONS OF THE AGREEMENT  
5.1  Transparency  
5.1.  Chapter 16  covers general transp arency disciplines related to publication; notification and 
provision of information; administrative proceedings, and review and appeal for the review and, 
where warranted, correction of final administrative actions regarding matters covered by the 
Agreeme nt; and regulatory coherence (Articles 16.2 through 16.5, and 16.7).  Specific transparency 
provisions are also contained in other Chapters of the Agreement.  
5.2.  The Agreement also governs the disclosure, or non -disclosure, of information in certain 
situation s (Article 19.1). It also contains disciplines on confidentiality of information (Article 19.2).  
5.2  Current payments and capital movements  
5.3.  The Parties agree to permit all transfers and payments that relate to the cross -border supply 
of services to be made free ly and without delay into and out of each Party (Article 7.12). Such 
transfers and payments may be made in a freely usable currency at the market rate of exchange 
that prevails at the time of transfer. Nevertheless, transfers may be prevented or delayed  for good 
faith application of laws and regulations on bankruptcy, insolvency, protection of the rights of 
creditors; issuing, trading or dealing in securities, futures, options or derivatives; criminal or penal 
offences; financial reporting or record keeping  of transfers in certain situations; or ensuring 
compliance with order or judgement in certain proceedings.  Article 8.17 includes s imilar disciplines 
on payments and transfers for the supply of financial services.  
5.3  Exceptions  
5.3.1   General exception  
5.4.  With respect to trade in goods, Article XX of the GATT 1994 shall apply to and is incorporated 
into and made part of the Agreement, while, with respect to trade in services, Article  XIV of the 
GATS applies to and is incorporated into and made part of the Agreement (Art icle 19.3). Building on 
Article XIV of the GATS, Article 12.12 makes the concept of general exception also applicable to 
Chapter 12 (on establishment and related provisions) . It also  cover s measures necessary to secure 
compliance with laws or regulations which are not inconsistent with the provisions of Chapter 12 
including those relating to the prevention of deceptive and fraudulent practices or to deal with the 
effects of a default on a co ntract; the protection of the privacy of individuals in relation to the 
processing and dissemination of personal data and the protection of confidentiality of individual 
records and accounts; or safety.  
5.3.2   Security exception  
5.5.  In connection with what each Party  consider s necessary for the protection of its respective 
essential security interests, the Agreement replicates the rules in Article XXI of the GATT 1994 , for WT/REG400/1 /Rev.1  
 
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  trade in goods, and Article XIV bis of the GATS , for trade in services (Article 19.3 ). The Joint 
Commission shall be informed of measures taken in connection with measures which the Parties 
may take under Article 19.3.  
5.3.3   Taxation measures  
5.6.  Nothing in the Agreement shall apply to taxation measures. The Agreement only grants rights 
or impose s obligations for taxation if: (i) they are also granted or imposed under the WTO 
Agreement; or (ii) they are granted or imposed under Chapter 2 (trade in goods), or Article 12.6 
(establishment and related provisions, and in particular the provisions on performance 
requirements) . Article 19.5 however foresees that rights granted and obligations imposed under the 
Agreement shall not apply to certain measures, such as, and inter alia , non -conforming provisions 
of existing taxation measures; taxation measures a imed at ensuring the equitable or effective 
imposition or collection of taxes, provided certain conditions are fulfilled. Moreover, nothing in the 
Agreement shall oblige a Party to extend to the other Party the benefit of any treatment, preference 
or privi lege arising  from any tax convention applicable to the Party.  
5.4  Accession and withdrawal  
5.7.  While the Agreement does not contain any provision on accession, it provides for a termination . 
Such termination shall take effect 180 days after the date of receipt of  the notification of withdrawal 
by a Party, or on such other date as the Parties may agree.  Consultation may take place between 
the Parties if requested following a notification of withdrawal  (Article 20.4).  
5.5  Institutional framework  
5.8.  Chapter 17  establishes the Hong Kong, China – Australia Joint Commission (hereinafter the 
Joint Commission) , inter alia, to review, consider and, as appropriate, decide on matters relating to 
the application or implementation of the Agreement45 (Article s 17.1 and 17.2 ). The Parties agree to 
undertake a general review , including matters relating to the implementation or operation of the 
Agreement, within five years of the date of entry in to force of the Agreement and every five years 
thereafter (Article 17.4).  
5.9.  While a number o f contact points and enquiry points are to be designated by the Parties under 
specific provisions under the Agreement, Article 17.5 identif ies the contact points established to 
facilitat e communication between them on any matter covered by the Agreement .46 
5.6  Dispute settlement  
5.10.   Chapter 18 establishes a dispute settlement mechanism between the Parties . It applies to the 
avoidance or settlement of disputes arising under the Agreement but it is not applicable to the 
settlement of dispute s under Chapter 5 (TBT); C hapter 6 (SPS); Chapter 15 (competition policy); 
and Article 16.6 and 16.7 of Chapter 16 (respectively SMEs and regulatory coherence, under the 
transparency provision).  
5.11.   Disputes arising on the same matter under the Agreement and under another international  
agreement, including the WTO Agreement, may be settled in either forum at the discretion of the 
complaining Party . Once a forum has been selected to address the matter, that forum shall be used 
to the exclusion of other in respect of the matter of the dis pute. However, the exclusive forum 
shopping principle shall not apply if substantially separate and distinct rights or obligations under 
different international agreements are in dispute; or the forum selected fails for procedural or 
jurisdictional reasons  to make findings on the merits of the claim (Article 18.4).  
5.12.   If a panel has been established under Chapter 18 to interpret an obligation under the 
Agreement, which is identical , or substantially identical , to an obligation under the WTO Agreement, 
 
45 The Joint Commission shall also review, consider and, as appropriate, decide on matters relating to 
the application or implementation of the associated investment agreement, also signed by the Parties, and 
which the Parties consider to constitute an inte gral part of a wider process of economic integration and trade 
liberalization.  
46 For Australia, the contact point is the Department of Foreign Affairs and Trade, or its successor. For 
Hong Kong, China, the contact point is the Trade and Industry Department , or its successor.  WT/REG400/1 /Rev.1  
 
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  the pane l shall also consider relevant interpretations in reports of WTO panels and the Appellate 
Body adopted by the WTO Dispute Settlement Body (Article 18.3).  
5.13.   Section B of Chapter 18 addresses the dispute settlement procedure. In particular, it governs 
the cons ultations that may be requested by a Party in any dispute arising under the Agreement 
(Article 18.5). It also covers good offices, conciliation and mediation, which may begin and be 
terminated at any time during the dispute settlement process (Article 18.6 ).  
5.14.   Section C (Articles 18.7 through 18.11) contains adjudication provisions, such as request s for 
establishment of panels; establishment47 and reconvening of panels; functions of panels; panel 
procedures, including timetable, panel proceedings, submission s, hearings, confidentiality, 
additional information and technical advice, and reports; and suspension and termination of 
proceedings. These disciplines a re based on disciplines under the WTO Dispute Settlement 
Understanding , with some differences. For example, before the panel presents its final report, it may 
at any stage of the proceedings propose to the Parties that the dispute be settled amicably. In 
addition,  there is no appeal stage in the dispute settlement mechanism under the Agreement.  
5.15.   Section D (Articles 18.12 through 18.14) is on implementation. It covers implementation by 
the responding Party and follow -up; compliance review; and compensation and suspension of 
concessions or other obligations, including post -suspe nsion review.  
5.16.   Section E (Articles 18.15 through 18.16) contains rules on the coverage of costs and 
expenses; the designation of contact points by each Party; and the use of the English language for 
all proceedings.  
5.7  Relationship with other agreements concl uded by the Parties  
5.17.   The Parties reaffirm their rights and obligations under the WTO Agreement and other 
international agreement s to which they are party. In the event of inconsistency between the 
Agreement and these agreements, the Parties agree to immedia tely consult with a view to finding a 
mutually satisfactory solution (Article 1.2).  
5.18.   Table 5.1 below shows the Parties' participation in RTAs, notified and non -notified, other than 
the Agreement.  
Table 5.1 Hong Kong, China and Australia. Participation in o ther RTAs (notified and non -
notified in force), as of 17 July  2020  
RTA Name  Date of 
entry into 
force  Coverage  GATT/WTO Notification  
Year WTO Provision  
HONG KONG, CHINA  
Hong Kong, China - Georgia  13-Feb-19 Goods & Services  2019 GATT Art. XXIV & GATS Art. V  
Hong Kong, China - Macao, China  27-Oct-17 Goods & Services  2017 GATT Art. XXIV & GATS Art. V  
Hong Kong, China - Chile 09-Oct-14 Goods & Services  2014 GATT Art. XXIV & GATS Art. V  
EFTA - Hong Kong, China  01-Oct-12 Goods & Services  2012 GATT Art. XXIV & GATS Art. V  
Hong Kong, China - New Zealand  01-Jan-11 Goods & Services  2011 GATT Art. XXIV & GATS Art. V  
China - Hong Kong, China  29-Jun-03 Goods & Services  2003 GATT Art. XXIV & GATS Art. V  
ASEAN - Hong Kong, China  11-Jun-1948 Goods & Services  Not notified  
AUSTRALIA  
Peru - Australia  11-Feb-20 Goods & Services  2020 GATT Art. XXIV & GATS Art. V  
Comprehensive and Progressive 
Agreement for Trans -Pacific 
Partnership (CPTPP)  30-Dec-18 Goods & Services  2018 GATT Art. XXIV & GATS Art. V  
Australia - China  20-Dec-15 Goods & Services  2016 GATT Art. XXIV & GATS Art. V  
 
47 The rules of procedure for panel proceedings are contained in Annex 18 -A to the Agreement, while 
the code of conduct for panellists is contained in Annex 18 -B to the Agreement.  
48 The ASEAN -Hong Kong, China FTA entered into force for (i) Hong Kong, China; Laos; Myanmar; Singapore; 
Thailand and Viet Nam on 11 Jun 2019; (ii) Malaysia on 13 Oct 2019; (iii) the Philippines on 12 May 2020; and 
(iv) Indonesia on 4 Jul 2020. Brunei Daruss alam and Cambodia are still undergoing domestic procedures in 
order to bring the FTA into force. (Situation in early July 2020).   WT/REG400/1 /Rev.1  
 
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  RTA Name  Date of 
entry into 
force  Coverage  GATT/WTO Notification  
Year WTO Provision  
Japan - Australia  15-Jan-15 Goods & Services  2015 GATT Art. XXIV & GATS Art. V  
Korea, Republic of - Australia  12-Dec-14 Goods & Services  2014 GATT Art. XXIV & GATS Art. V  
Malaysia - Australia  01-Jan-13 Goods & Services  2013 GATT Art. XXIV & GATS Art. V  
ASEAN - Australia - New Zealand  01-Jan-10 Goods & Services  2010 GATT Art. XXIV & GATS Art. V  
Australia - Chile 06-Mar-09 Goods & Services  2009 GATT Art. XXIV & GATS Art. V  
Thailand - Australia  01-Jan-05 Goods & Services  2004 GATT Art. XXIV & GATS Art. V  
United States - Australia  01-Jan-05 Goods & Services  2004 GATT Art. XXIV & GATS Art. V  
Singapore - Australia  28-Jul-03 Goods & Services  2003 GATT Art. XXIV & GATS Art. V  
Australia - New Zealand Closer 
Economic Relations Trade 
Agreement (ANZCERTA)  01-Jan-83 
01-Jan-89 Goods  
Services  1983 
1995 GATT Art. XXIV  
GATS Art. V  
South Pacific Regional Trade and 
Economic Cooperation Agreement 
(SPARTECA)  01-Jan-81 Goods  1981 Enabling Clause  
Australia - Papua New Guinea 
(PATCRA)  01-Feb-77 Goods  1976 GATT Art. XXIV  
Indonesia -Australia  5-Jul-20 Goods & Services  Not notified  
Source:  WTO Secretariat. Further information on these Agreements and on specific dates of entry into 
force/provisional applications may be found in the WTO Database on RTAs: http://rtais.wto.org . 
5.8  Government procurement  
5.19.   Chapter  13 of the Agreement contains rules on Government procurement. While it applies to 
covered procurement49, it does not apply to non -contractual agreements or any form of assistance 
that a Party provides50; procurement related to international assistance and  development aid; public 
employment contracts; procurement by international organisations; the acquisition or rental of land, 
existing buildings, or other immov able property; procurement conducted under an international 
agreement relating to the stationing  of troops; or procurement or acquisition of fiscal agency or 
depository services, liquidation and management services for regulated financial institutions, or 
services related to the sale redemption and distribution of public debt.  
5.20.   Each Party specifies i n its Schedule in Annex 13 -A to the Agreement , its commitments with 
respect to  covered procurement by : central government entities (Section A of Annex 13 -A), sub-
central government entities (Section B) , and other entities (Section C); as well as covered  goods 
(Section D) , services, other than construction services (Section E) , and construction services 
(Section F) . 
5.21.   Hong Kong, China has been a party to the 1994 WTO Government Procurement Agreement 
(GPA) since 19 June 1997 , and to the Revised GPA, since 6 April 2014. Australia has been a party 
to both 1994 WTO Government Agreement (GPA) and to the Revised GPA since 5 May 2019. Both 
Parties commitments under the Agreement largely mirror their commitments under th e Revised GPA 
with respect to entities and thresholds, thus leaving the Parties' commitments vis-à-vis each other 
largely unchanged.  
5.22.   Chapter 13 also provides , in Articles 13.2 through 13.18,  for disciplines on compliance with 
the commitments made by each Party; the valuation of procurement; applicable general exceptions; 
the applicable general principles51; publication of procurement information; notices of intended and 
planned procurements; conditions for participation in a covered procurement; qualificat ion of 
suppliers, including registration systems and qualification procedures, selective tendering, and multi -
use lists; procedures with respect to limited tendering; conditions for the negotiations which could 
be conducted by the procuring entities; techn ical specifications that may apply; tender 
documentation to be made available; applicable time -period for the tender procedure; treatment of 
 
49 Under the Agreement, the term "covered procurement" corresponds to the broad definition under the 
Revised GPA.  
50 Including grants, loans, equity infusions, fiscal incentives, subsidies, guarantees, cooperative 
agreements and sponsorship arrangements.  
51 Such as non -discrimination; procurement methods; rules of origin; offsets; measures not specific to 
procurement; and use of e lectronic means.  WT/REG400/1 /Rev.1  
 
- 39 - 
 
  tenders and awarding  of contracts; post -award information; disclosure of information; ensuring 
integrity in procure ment practices; and administrative and judicial review.  
5.23.   A Party may modify its coverage under Chapter 13, under conditions set in Article 13.19. 
Compensation may have to be provided in certain cases.  
5.24.   The Parties commit to cooperate in government procureme nt-related matters. They also agree 
to consult regarding Chapter 13. Moreover, they may decide to hold further negotiations with a view 
to revising the thresholds set out in Annex 13 -A and the threshold adjustment formula set out in 
Section H of Annex 13 -A. 
5.25.   The Parties exchanged side letters to provide for e ntering into discussions at an agreed time, 
but no later than two years after the date of entry into force of the Agreement, to facilitate industry 
capacity and capability to engage in each other's gover nment procurement markets, including on 
conditions for participation in each other's procurement markets and the related assessment 
process.  
5.9  Intellectual property rights  
5.26.   Chapter 14 cover s the protection of  intellectual property rights (IPR). It establishes that the 
obligations in the Agreement constitute minimum obligations and that each Party shall be free to 
determine the appropriate method of implementing the Agreement's IPR-related provisions within 
its own legal system and practice (Artic le 14.3).  
5.27.   While the Parties recognise the principles and flexibilities established in the 2001 WTO 
Declaration on the TRIPS Agreement and Public Health , they affirm their commitment to contribute 
to international efforts on the acceptance and implementatio n of the Protocol attached to the WTO 
General Council Decision of 6 December 2005 on the Amendment of the TRIPS Agreement 
(Article  14.4). The Parties also affirm their commitments to the TRIPS Agreement and any other 
multilateral agreements concluded or ad ministered under the auspices of the WIPO to which both 
are party.  They moreover commit to becom ing parties  to or apply ing a number of multilateral 
agreements52, if they are not already party to them , and  shall endeavour to become part ies to a 
number of ot her multilateral agreements53 to comply with their substantive provisions, if they are 
not already party to them  (Article 14.5) . 
5.28.   Each Party reaffirm s its commitment to accord national treatment to natural persons of the 
other Party or an enterprise of that  Party, who would meet the criteria for eligibility for protection 
provided for in the agreements listed in Article 14.5.2 and the TRIPS Agreement. (Article 14.6). 
Procedures provided in multilateral agreements concluded under the auspices of WIPO in relat ion to 
the acquisition or maintenance of IPR as well as exceptions provided in the TRIPS Agreement, and 
certain measures in relation to a Party's judicial or administrative procedure, remain applicable with 
regards to commitments made under Chapter 14 . 
5.29.    Chapter 14 contains additional provisions on various IPR -related matters .  
5.30.   On trademarks under Article 14.10, no Party may require as a condition of registration that 
trademarks  are visually perceptible; that they only  compris e sounds or scents  but may require an 
adequate description would be a  graphical representation of a trademark. It also relates to the 
protection of collective and certification trademarks. Signs that may serve as geographical 
indications (GI) may be protect ed under a trademark system. Parties may nevertheless provide 
 
52 These are: the Paris Convention for the Protection of Industrial Property ; the Berne Convention for 
the Protection of Literary and Artistic Works ; the International Convention for the Protection of Performers, 
Producers of Phonograms and Broadcasting Organisations  (the Rome Convention); the Patent Cooperation 
Treaty  (the Washington Treaty); the Budapest Treaty on the International Recognition of the Deposit of 
Microorganisms for the Purposes of Patent Procedure ; the Nice Agr eement Concerning the International 
Classification of Goods and Services for the Purposes of the Registration of Marks ; the World Intellectual 
Property Organization Performances and Phonograms Treaty ; the WIPO Copyright Treaty ; and the 
International Conven tion for the Protection of New Varieties of Plants . 
53 The Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks ; 
and the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Imp aired, 
or Otherwise Print Disabled . WT/REG400/1 /Rev.1  
 
- 40 - 
 
  limited exceptions to the rights conferred by a trademark, such as fair use of descriptive terms, 
provided that such exceptions take account of the legitimate interest of the owner of the tradem ark 
and of third parties . 
5.31.   On GI s (Article 14.11) , the Parties recognise the protection of GI s through a trademark or a 
sui generis system, or other legal means. Transparency shall be guaranteed for GI s proposed for 
protection or recognition and appropriate  procedures shall be in place for recognition or refusal of 
recognition.  
5.32.   Subject to international obligations and domestic laws applicable to each Party, appropriate 
measures may be established to protect genetic resources, traditional knowledge and folkl ore 
(Article 14.12).  
5.33.   TRIPS provisions on the protection of undisclosed information are essentially replicated in 
Article 14.13.  
5.34.   On copyrights (Article 14.14), the Agreement underlines that each Party shall foster the 
establishment or maintenance of appropr iate bodies for the collective management of copyrights, 
also emphasising the need to achieve an appropriate balance in its copyrights and related rights 
system, while giving due consideration to legitimate purposes such as criticism, news reporting, 
teach ing, research, review, study, and facilitating access to published works for persons who are 
blind, visually impaired or otherwise print disabled.  
5.35.   With respect to exhaustion, the freedom of the Parties to determine whether, and under what 
conditions, the e xhaustion of intellectual property rights applies remains unchanged by the 
Agreement (Article 14.8).  
5.36.   The Parties commit to continue to work to enhance their examination and registration 
systems, including through improving examination procedures and quali ty systems, and with a view 
to achieving efficient and timely grant or registration of IPR s. Disciplines on procedures and 
acquisition and maintenance are contained in Article 14.9.  
5.37.   Chapter 14 also contains transparency provisions (Article 14.7)  including the publication of 
final judicial decisions or rulings on IPR enforcement . 
5.38.   The Parties reaffirm and build on TRIPS rules on enforcement (Article 14.15) and provide for 
disciplines on the determination and treatment of counterfeit trademark and pirated copy right goods 
(Article 14.16).  
5.39.   The Agreement foresees IP R-related cooperation between the Parties (Article 14.17) and 
requires that each Party designates a contact points to facilitate communications between the Parties 
on any matter covered by Chapter 14.   
5.10  Competition  
5.40.   Chapter 15 addresses competition.  It requires that Parties shall maintain competition laws to 
proscribe anti -competitive conduct, with the objective of promoting economic efficiency and 
consumer welfare. It also requires that each Party mainta ins a competition authority responsible for 
the enforcement of its competition law (Article 15.2).  
5.41.   The principle of procedural fairness in competition law enforcement is embedded in Article 
15.3, while, under Article 15.4, recognising that a private right of action54 is an important 
supplement to the public enforcement of competition law, each Party agrees that it should adopt or 
maintain laws that provide an independent private right of action.  
 
54 For the purposes of the Agreement, "private right of action" means the right of a person to seek 
redress, including injunctive, monetary or other remedies, from a court or other independent tribunal for injury 
to that person's business or property caused by a violation of a Party's competition law, either independently or 
following a finding of violation by the competition authority of that Party.  WT/REG400/1 /Rev.1  
 
- 41 - 
 
  5.42.   Consultations on competition -related matters are foreseen in o rder to foster mutual 
understanding between the Parties, or to address any specific matter under Chapter 18 
(Article  15.7). Cooperation is also encouraged in the area of competition policy, as well as on issues 
of competition law enforcement, notification,  consultations, exchange of information and 
coordination on cross -border enforcement matters (Article 15.5). Moreover, while each Party shall 
adopt or maintain laws or regulations on consumer protection, the promotion of cooperation and 
coordination on mat ters of mutual inter est related to unfair trade practices is among the disciplines 
contained in Article 15.6.  
5.43.   No Party may have recourse to dispute settlement under Chapter 1 8 (consultations and 
dispute settlement)  for any competition -related matter arisin g under Chapter 1 5. 
5.10.1   Environment  
5.44.   The Agreement does not contain any environment  related provisions.  
5.11  Labour  
5.45.   The Agreement does not contain any labour related provisions.  
5.12  Electronic commerce  
5.46.   Chapter 11 addresses  electronic commerce and applies to measures adopted or maintained 
by a Party that affect trade by electronic means. It does not apply to government procurement; 
information held or processed by or on behalf of a Party; or subsidies or grants provided by a  Party 
whether or not such subsidies or grants are offered exclusively to domestic services, service 
consumers or service suppliers.  
5.47.   Under Section A (Articles 11.2 through 11.13 ), the  Parties cannot deny the legal validity of 
electronic signatures (Articl e 11.3). They agree to maintain a legal framework consistent with the 
principles of the UNCITRAL Model Law on Electronic Commerce or the UN Convention on the Use of 
Electronic Communications in International Contracts (Article 11.4) and to ensure transpare nt and 
effective methods to protect consumers (Article 11.5). They agree to not impose customs duties on 
electronic transmissions although this shall not preclude them from imposing internal taxes, fees or 
other charges on electronic transmissions as long as these are consistent with the Agreement 
(Article  11.6). The Chapter also includes a commitment to not require a covered person to use or 
locate computing facilities in the Party's Area as a condition for conducting business in that Area 
(Article  11.8). Other provisions include a commitment to provide a legal framework for the protection 
of personal information; a best endeavour commitment on paperless trading; measures to regulate 
unsolicited commercial electronic messages; and a prohibition on any requi rement to transfer the 
source  code as a condition for the import, distribution or sale of software or products containing 
such software. Article 11.13 has provisions on cooperation between the Parties on electronic 
commerce.  
5.48.   Section B specifically governs  movement of information and location of computing facilities 
for financial services (Article 11.15).  
5.13  Small and medium -sized enterprises  (SMEs)  
5.49.   Chapter 16 (on transparency), contains each Party's commitment to establish or maintain its 
own publicly accessible website with information regarding the Agreement, including information 
designed for SMEs .55 Such information should contain a description o f the provisions in the 
Agreement that the Party considers to be most relevant to SMEs, and any additional information 
that it considers would be useful for SMEs interested in benefitting from the opportunities provided 
by the Agreement (Article 16.6).  There is also a n indicative list of the types of such information . 
Each Party also commit s to regularly review the information and links on its dedicated website.   
 
55 The Parties' relevant websites are, for Hong Kong, China:  
https://www.tid.gov.hk/english/ita/fta/hkaufta/index.html ; and for Australia: 
https://www.dfat.gov.au/trade /agreements/in -force/a -hkfta/Pages/default  and https://ftaportal.dfat.gov.au/  WT/REG400/1 /Rev.1  
 
- 42 - 
 
  5.50.   Neither Party shall have recourse to dispute settlement under Chapter 18 (Consultations and 
dispute settlement) for any matter arising under Article 16.6.   
5.51.   There are also provisions on SMEs under the Chapter on electronic commerce, calling for the 
Parties to endeavour to work together to assist SMEs to overcome obstacles to the use of electronic 
commerce.WT/REG400/1/Rev.1  
 
- 43 - 
 
  ANNEX 1  
INDICATORS OF TRADE LIBERALIZATION UNDER THE AGREEMENT  
Hong Kong, China 's Market  
1 Table A1.1 gives an indication of market access in Hong Kong, China for Australia's  top 25 
global exports, which accounted for 67.4% of its global exports in 201 7-2019; these corresponded 
to 79 lines in Hong Kong, China's tariff at the HS six -digit level ( using the HS  2017). Prior to the 
entry into force of the Agreement, all these lines were already (MFN) duty free. On the date of entry 
into force of the Agreement, in 2014, all these tariff lines became legally bound at duty free level 
for exports from Australia.  
Table A1. 1 Hong Kong, China: Market access opportunities under the Agreement for 
Australia's top 25 exports to the world  
Australia's top export products in 2017 -2019  Access Conditions to 
Hong Kong, China's 
import markets  
HS number and descripti on of the product  Share in 
global 
exports 
(%) MFN 2020  
Average 
MFN 
applied 
rate (%)  Number  
of duty -
free lines  
260111  Non-agglomerated iron ores and concentrates  21.3 0.0 1 
270112  Bituminous coal, whether or not pulverised, non-
agglomerated  18.2 0.0 1 
710813  Gold, incl. gold plated with platinum, in semi -
manufactured forms, for non -monetary purposes  5.7 0.0 1 
271111  Natural gas, liquefied  4.7 0.0 1 
270900  Petroleum oils and oils obtained from bituminous 
minerals, crude  2.0 0.0 1 
260300  Copper ores and concentrates  1.6 0.0 1 
020230  Frozen, boneless meat of bovine animals  1.5 0.0 2 
100199  Wheat and meslin  1.3 0.0 1 
281820  Aluminium oxide  1.2 0.0 1 
510111  Greasy shorn wool, incl. fleece -washed wool, neither 
carded nor combed  1.0 0.0 1 
020130  Fresh or chilled bovine meat, boneless  1.0 0.0 1 
740311  Copper, refined, in the form of cathodes and sections of 
cathodes  1.0 0.0 1 
760110  Aluminium, not alloyed, unwrought  0.9 0.0 2 
260800  Zinc ores and concentrates  0.7 0.0 1 
220421  Wine of fresh grapes, incl. fortified wines, and grape 
must whose fermentation has been arrested by the 
addition of alcohol, in containers of <= 2 l  0.7 0.0 5 
271019  Medium oils and preparations, of petroleum or 
bituminous minerals, not containing biodiesel, n.e.s.  0.6 0.0 15 
300490  Medicaments consisting of mixed or unmixed products 
for therapeutic or prophylactic purposes, put up in 
measured doses "incl. those for transdermal 
administration" or in forms or packings for retail sale  0.6 0.0 25 
880330  Parts of aeroplanes or helicopters, n.e.s.  0.5 0.0 1 
020442  Frozen cuts of sheep, with bone in  0.5 0.0 1 
790111  Unwrought zinc, not alloyed, containing by weight >= 
99,99% of zinc  0.5 0.0 1 
520100  Cotton, neither carded nor combed  0.5 0.0 1 
210690  Food preparations, n.e.s.  0.4 0.0 8 
100390  Barley  0.4 0.0 1 
253090  Arsenic sulfides, alunite, pozzuolana, earth colours and 
other mineral substances, n.e.s.  0.4 0.0 4 WT/REG400/1 /Rev.1  
 
- 44 - 
 
  Australia's top export products in 2017 -2019  Access Conditions to 
Hong Kong, China's 
import markets  
HS number and descripti on of the product  Share in 
global 
exports 
(%) MFN 2020  
Average 
MFN 
applied 
rate (%)  Number  
of duty -
free lines  
261690  Precious -metal ores and concentrates  0.4 0.0 1 
TOTAL  67.4  79 
Note:  Based on the HS 2017 nomenclature.  
Source:  WTO estimates based on data from the WTO -IDB, ITC TradeMap and UNSD, Comtrade database.  
 
Australia 's market  
2. As depicted in Table A1.2, the overall average applied on an MFN basis prior to the entry into 
force of the Agreement was 2.5% ( 1.1% for agricultural products, and double that at 2.8% for 
industrial  products) while 49.4% of Australia's tariff lines were du ty free prior to the entry into force 
of the Agreement ( 78.3% for agricultural products and 43.8% for industrial ). Immediately at the 
entry into force of the Agreement, all tariff lines became duty free for imports originating in Hong 
Kong, China.  
Table A1. 2 Australia: Indicators of MFN tariff rates and preferential rates for imports 
from Hong Kong, China  
Origin of 
goods  Year ALL PRODUCTS  Agricultural productsa industrial  products  
Average applied 
tariff  Share 
of duty -
free 
tariff 
lines 
(%) Average applied 
tariff  Share of 
duty-
free 
tariff 
lines 
(%) Average applied 
tariff  Share 
of duty-
free 
tariff 
lines 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) Overall 
(%) On 
dutiable 
(%) 
MFN 2020 2.5 5.0 49.4 1.1 5.4 78.3 2.8 5.0 43.8 
Hong Kong, 
China  2020 0.0 0.0 100.0  0.0 0.0 100.0  0.0 0.0 100.0  
a WTO Definition.  
Note:  For the calculation of averages, specific rates are excluded, and the ad valorem  parts of alternate 
rates are included.   
 Based on the HS 2017 nomenclature.  
Source:  WTO estimates based on data from the Australian authorities.  
 
3. Table A1. 3 gives an indication of additional market access into Australia resulting from the 
entry into force of the Agreement for Hong Kong, China's  top 25 global exports, which accounted for 
64.3% of its global exports in 201 7-2019; these corresponded to 34 lines in Australia's  tariff at the 
six-digit level (using the HS  2017). In 2020, prior to the entry into force of the Agreement, 30 of 
these tariff lines  were already (MFN) duty free in Australia's  market. With the entry into for ce of the 
Agreement, on 1 January 2020, the 4 remaining dutiable tariff lines became duty -free. 
Table A1. 3 Australia: Market access opportunities under the Agreement for Hong Kong, 
China's top 25 exports to the world  
Hong Kong, China's top export products in 2017 -2019  Access Conditions to Australia's import 
markets  
HS number and description of the product  Share in 
global 
exports 
(%) MFN 2020  Number  
of duty -
free lines 
under the 
agree -
ment  Average 
MFN 
applied 
rate (%)  
Number  of 
dutiable 
lines  
Number of 
duty-free 
lines  
854239  Electronic integrated circuits  8.6 0.0 1   WT/REG400/1/Rev.1  
 
- 45 - 
 
  Hong Kong, China's top export products in 2017 -2019  Access Conditions to Australia's import 
markets  
HS number and description of the product  Share in 
global 
exports 
(%) MFN 2020  Number  
of duty -
free lines 
under the 
agree -
ment  Average 
MFN 
applied 
rate (%)  
Number  of 
dutiable 
lines  
Number of 
duty-free 
lines  
854231  Electronic integrated circuits as 
processors and controllers, whether or 
not combined with memories, 
converters, logic circuits, amplifiers, 
clock and timing circuits, or other 
circuits  7.1 0.0 1   
710812  Gold, incl. gold plated with platinum, 
unwrought, for non -monetary purposes  6.9 0.0 1   
854232  Electronic integrated circuits as 
memories  6.2 0.0 1   
851770  Parts of telephone sets, telephones for 
cellular networks or for other wireless 
networks and of other apparatus for the 
transmission or reception of voice, 
images or other data, n.e.s.  5.9 0.0 2   
851712  Telephones for cellular networks 
"mobile telephones" or for other 
wireless networks  5.2 0.0 1   
847330  Parts and accessories of automatic 
data-processing machines or for other 
machines of heading 8471, n.e.s.  4.3 0.0 1   
851762  Machines for the reception, conversion 
and transmission or regeneration of 
voice, images or other data, incl. 
switching and routing apparatus  2.5 0.0 1   
710239  Diamonds, worked, but not mounted or 
set 2.4 0.0 1   
853400  Printed circuits  1.9 0.0 1   
852990  Parts suitable for use solely or 
principally with transmission and 
reception apparatus for radio -
broadcasting or television, television 
cameras,digital cameras, video camera 
recorders, radar apparatus, radio 
navigational aid apparatus or radio 
remote control apparatus, monitors and 
projectors, n.e.s.  1.7 1.0 4 1 1 
847170  Storage units for automatic data -
processing machines  1.2 0.0 1   
711319  Articles of jewellery and parts thereof, 
of precious metal other than silver, 
whether or not plated or clad with 
precious metal  1.2 5.0  1 1 
847130  Data-processing machines, automatic, 
portable, weighing <= 10 kg, consisting 
of at least a central processing unit, a 
keyboard and a display  1.0 0.0 1   
853690  Electrical apparatus for switching 
electrical circuits, or for making 
connections to or in electrical circuits, 
for a voltage <= 1.000 v  1.0 3.3 1 2 2 
844399  Parts and accessories of printers, 
copying machines and facsimile 
machines, n.e.s.  0.9 0.0 1   
850440  Static converters  0.9 0.0 2   
847180  Units for automatic data -processing 
machines  0.7 0.0 1   
841112  Turbojets of a thrust > 25 kn  0.7 0.0 1   WT/REG400/1 /Rev.1  
 
- 46 - 
 
  Hong Kong, China's top export products in 2017 -2019  Access Conditions to Australia's import 
markets  
HS number and description of the product  Share in 
global 
exports 
(%) MFN 2020  Number  
of duty -
free lines 
under the 
agree -
ment  Average 
MFN 
applied 
rate (%)  
Number  of 
dutiable 
lines  
Number of 
duty-free 
lines  
852351  Solid-state, non -volatile data storage 
devices for recording data from an 
external source [flash memory cards or 
flash electronic storage cards]  0.7 0.0 1   
847150  Processing units for automatic data -
processing machines, whether or not 
containing in the same housing one or 
two of the following types of unit: 
storage units, input units, output units  0.7 0.0 1   
854233  Electronic integrated circuits as 
amplifiers  0.7 0.0 1   
854140  Photosensitive semiconductor devices, 
incl. photovoltaic cells whether or not 
assembled in modules or made up into 
panels; light emitting diodes  0.6 0.0 1   
853224  Fixed electrical capacitors, ceramic 
dielectric, multilayer  0.6 0.0 1   
852580  Television cameras, digital cameras and 
video camera recorders  0.6 0.0 2   
TOTAL  64.3  30 4 4 
Note:  For the calculation of averages, specific rates are excluded, and the ad valorem  parts of alternate 
rates are included.   
 Based on the HS 2017 nomenclature.  
Source:  WTO estimates based on data from the Australian authorities and UNSD, Comtrade database.  
 
__________