G/SCM/N/315/HKG  
 
30 June 2017 
(17-3542) Page: 1/7 
Committee on Subsidies and Countervailing Measures  Original: English  
 
SUBSIDIES  
NEW AND FULL NOTIFIC ATION PURSUANT TO AR TICLE XVI:1 OF  
THE GATT 1994 AND AR TICLE 25 OF THE AGRE EMENT ON  
SUBSIDIES AND COUNTE RVAILING MEASURES  
HONG KONG, CHINA 
The following notification, dated 29 June 201 7, is being circulated at the request of t he Delegation 
of Hong Kong, China.  
 
_______________  
 
Pursuant to Article XVI:1 of the GATT 1994 and Article 25 of the Agreement on Subsidies and 
Countervailing Measures  (ASCM) , Hong Kong, China submits herewith the new and full notification  
for the fiscal year 2016-17. In accordance with Article 25.7 of the ASCM, the notification of the 
measures concerned does not prejudge their legal status, effects or nature under the GATT 1994 
and the ASCM . 
A. FISHERIES DEVELOPMEN T LOAN FUND  
1. Title of the programme  
Fisher ies Development Loan Fund.  
2. Period covered by the notification  
Fiscal year 2016-17 (i.e. April 2016 – March  2017). 
3. Policy objective and/or purpose  
(a) To provide one -off loans for owners of trawlers and fish collectors affected by the trawl ban1 
to upgrade their vessels to standards required for operations outside Hong Kong waters , switch to 
more sustainable fisheries operations and other fisheries -related operations, or carry out projects 
that will reduce fuel consumption or the carbon footprint of th eir operations (without increasing 
fishing effort) . The deadline of application was 31.12.2015 ;  
(b) To provide loans for capture fishermen and owners of fish collectors to switch to more 
sustainable fisheries operations and other fisheries -related operati ons, or carry out projects that 
will reduce fuel consumption or the carbon footprint of their operations (without increasing fishing 
effort); and  
(c) To provide loans that help fish farmers develop aquaculture , or improve their aquaculture 
businesses leadi ng to more environmentally friendly operations or better aquaculture products in 
terms of quality and food safety standards.  
                                                
1 All trawling activities in Hong Kong waters have been banned since 31 December 2012.  G/SCM/N/315/HKG  
 
- 2 - 
 
  4. Background and authority  
The Fund is administered by the Agriculture, Fisheries and Conservation Department.  
5. Form 
Loan.  
6. To whom and how the assistance is provided  
Applicants for loans under 3(a) and 3(b) above must be Hong Kong residents and owners of local 
fishing vessel s or fish collector s, holding valid licences necessary for their operations; or locally 
registered fisheri es co -operative societies/companies with the majority of their 
members/shareholders being local capture fishermen who fulfill the afore -mentioned criteria . 
Applicants for the loans under 3(a)  also have to prove that they are genuinely affected by the 
trawl ban.  
Applicants for loans under 3(c) above must be Hong Kong residents, holding valid licences 
necessary for operating their aquaculture businesses; or locally registered fisheries co -operative 
societies/companies with the majority of their members/share holders being local aquaculture 
operators who fulfill the afore -mentioned criteria.  
An interest rate of 1% per annum is applied to the  loans under 3(a) above ; 2.5% per annum  for 
the loans under 3(b) above ; and at an interest rate based on the "No Gain No L oss" principle of 
the Hong Kong Special Administrative Region (HKSAR) Government for the loans under 
3(c) above. The "No Gain No Loss" rate is set by taking into account factors such as the best 
lending rates of the note -issuing banks in Hong  Kong.   
7. Amount 
The amount of loans issued for the fiscal year of 2016-17: HK$15 2,221,000. 
8. Duration  
This is an on -going scheme , except the loans under 3(a) above  which  are no longer available and 
will be terminated when all the outstanding loans are repaid . 
9. Statistical data permitting an assessment of the trade effects  
Not available.  
B. FISH MARKETING ORGAN IZATION LOAN FUND  
1. Title of the programme  
Fish Marketing Organization Loan Fund.  
2. Period covered by the notification  
Fiscal year 201 6-17 (i.e. April 2016 – March 2017). 
3. Policy objective and/or purpose  
To provide loans for fishermen to meet their operational and sustainable development needs, 
including  the repair and replacement of fishing vessels, gear and equipment; assisting fishermen 
to tide over the annu al fishing moratorium.   G/SCM/N/315/HKG  
 
- 3 - 
 
  4. Background and authority  
The Fund is set up by the Fish Marketing Organization (FMO), a statutory body established under 
the Marine Fish (Marketing) Ordinance (Cap. 291), with funding /injections from both FMO and the 
HKSAR Govern ment.  Profits from the operations of t he FMO are the major source of the fund.  
5. Form 
Loan.  
6. To whom and how the assistance is provided  
Applicants must be a member of a registered fishermen's co -operative society or a registered 
fishing company; or a lo cal fisherman who:  
 holds a valid fishing vessel licence issued by the Marine Department;  
 is a bona fide fisherman ; 
 markets or intends to market his catches through FMO; and  
 fulfills other requirements as specified by FMO.  
There are two types of loans tha t may be granted under the Fund: (i) general loans, and 
(ii) special one -year loans for fishermen affected by the annual fishing moratorium in the 
South  China Sea. The interest rates applicable in the fiscal year 201 6-17 were as follows:  
 general loans: 2.83% per annum for individual fishermen, and 1.33% per annum for 
members of registered co -operative societies;  
 special one -year loans for fishermen affected by the annual moratorium: 1% per annum . 
7. Amount  
The amount of loans issued  for the fiscal year of 2016-17 was as follows:  
 general loans: HK$210,000.  
 special loans for fishermen affected by the annual moratorium: HK$ 38,190,000.  
8. Duration  
This is an on -going scheme.  
9. Statistical data permitting an assessment of the trade effects  
Not available.  
C. KADOORI E AGRICULTURAL AID L OAN FUND  
1. Title of the programme  
Kadoorie Agricultural Aid Loan Fund.  
2. Period covered by the notification  
Fiscal year 201 6-17 (i.e. April 2016 – March  2017). G/SCM/N/315/HKG  
 
- 4 - 
 
  3. Policy objective and/or purpose  
To provide loans for fish farmers and f armers for development purpose and as working capital. 
Specifically, loans are issued for purchase of livestock, fry, feed and farm equipment, and 
maintenance of farms.  
4. Background and authority  
The Fund is established under the Kadoorie Agricultural Aid  Loan Fund Ordinance (Cap. 1080) with 
donations/injections from both non -government sources and the HKSAR Government.  
5. Form 
Loan.  
6. To whom and how the assistance is provided  
Fish farmers and farmers. The interest rates applicable in the fiscal year 201 6-17 were as follows:  
 loans not exceeding HK$1 30,000: 0.00525%  per annum for development capital, and 
0.007%  per annum for working capital;  
 loans exceeding  HK$1 30,000  but not exceeding  HK$200,000: 2.04515%  per annum;  
 loans at HK$ 200,000  and above: 4.0833%  per annum.   
7. Amount  
The amount of loans issued  for fish farmers for the fiscal year of 2016-17: HK$1,870,000. 
8. Duration  
This is an on -going scheme.  
9. Statistical data permitting an assessment of the trade effects  
Not available.  
D. SUSTAINABLE FISHERIE S DEVELOPMENT FUND  
1. Title of the programme  
Sustainable Fisheries Development Fund . 
2. Period covered by the notification  
Fiscal year 2016-17 (i.e. April 2016 - March  2017). 
3. Policy objective and/or purpose  
This Fund  is set up to fund programme s, projects and research that would contribute to fostering 
the sustainable development of the fisheries industry and bring benefits to the operations of the 
local fisheries community as a whole.  
4. Background and authority  
The Fund is administered by the Agriculture , Fisheries and Conservation Department . Projects that 
may benefit from the Fund include those that provide  technical assistance and training in fishing 
operations, support for fishermen to switch to other fisheries or sea related operations  following 
implementation of the trawl ban in Hong Kong waters since December 2012 , assistance for local  G/SCM/N/315/HKG  
 
- 5 - 
 
  aquaculturists  to modernize their operations, and monitoring and assess ment of  the effectiveness 
of the sustainable fisheries management measures implemented in Hong  Kong. In general, 
projects should be non -profit making in nature and the mode of assistance will be in the form of 
grant. If there are initiatives that aim to demonstrate the technical feasibility and commercial 
viability of new fisheries practices which may subsequently be transferred to other stakeholders 
within the fisheries industry, such initiatives with commercial elements will be funded on a dollar -
for-dollar matching basis, with the HKSAR  Government's total contribution capped at the 
applicant's tot al contribution. The HKSAR  Government will recoup the cost commensurate with its 
share of contribution.  
5. Form 
Grant.  
6. To whom and how the assistance is provided  
An application fulfilling the assessment criteria will be considered, vetted and awarded on  its 
individual merits (including the efficacy  of the project and the capacity and capability of the 
applicant) . The following entities may be eligible to  apply:  
(a) Where applications are made by legal entities, the entity concerned  should be a company 
incorporated in Hong Kong  under the  Companies Ordinance (Cap. 622) and has substantial 
connection to  Hong Kong  or a body corporate incorporated in Hong Kong  under  other Ordinances 
of the HKSAR , and having demonstrated a close connection with the fisheries  industry in 
Hong Kong. These include local registered fisheries  co-operatives, non -profit  making fisheries 
organi sations, non -governmental  organi sations or social enterprises; and  
(b) Academic and research institutions in Hong Kong . 
7. Amount  
The amount of g rant issued for the fiscal year of 2016 -17: HK$11,272,000 . 
8. Duration  
The Fund has an approved commitment  of HK $500 million . It is open to applications since 
July 2014.  
9. Statistical data permitting an assessment of the trade effects  
Not available.  
E. RECY CLING  FUND  
1. Title of the programme  
Recycling Fund.  
2. Period covered by the notification  
Fiscal year 201 6-17 (i.e. April 2016 - March  2017). 
3. Policy objective and/or purpose  
To promote the recovery and recycling of waste  as well as the sustainable deve lopment of the 
recycling industry  thus reducing disposal at local landfills .  G/SCM/N/315/HKG  
 
- 6 - 
 
  4. Background and authority  
The Fund was established in October 2015 with a non -recurrent commitment of HK$1 billion by the 
HKSAR Government.  Two funding programmes have been est ablished under the Fund.  
Funding for individual enterprises  
Enterprises with demonstrated connection s with the recycling industry in Hong Kong are eligible to 
apply for a matching fund  up to HK$5 million  for each project to upgrade and expand their waste 
recycling operations.  Eligible  expenditure items include capital costs for the purchase of equipment  
and operating costs (e.g. additional manpower costs, cost of promotion and publicity ). 
Funding for industry support projects  
Non-profit distributing organis ations  may apply for the Fund to undertake non -profit making 
projects for enhancing the operational standards and productivity of the recycling industry , 
through  upgrading the skills of incumbent and potential employees of the  recycling industry , 
enhancing  the occupational safety standard of the operations,  expanding the potential workforce  of 
the industry , as well as developing  certification schemes for recycling operations.  The grant may 
cover up to 100% of approved expenditure items with a ceiling of HK$ 15 million  per project . 
An Advisory Committee on Recycling Fund2 has been set up to advise and make recommendations 
to the HKSAR  Government on matters relating to the overall administration  and operation of the 
Fund.   
5. Form 
Grant. 
6. To whom and how the assistance is provided  
The Fund aims to provide funding to projects which demonstrate potential to : 
(i) raise the quantity and quality of recyclables recovered from the waste stream as well as 
those of recycled products, thus reducing disposal at local lan dfills;  
(ii) promote the development of markets for recycled products, thus providing greater impetus 
to local landfill diversion; and  
(iii) enhance the overall capability, capacity, efficiency and skills as well as market information of 
the recycling ind ustry, thus facilitating its sustainable development.  
The following parties are eligible to apply:  
Enterprises  
Any enterprise which has been duly established, incorporated and registered under the laws of 
Hong Kong or its place of incorporation  with a vali d business registration certificate  issued under 
the Business Registration Ordinance , and has been operating a substantive business operation  in 
Hong Kong.  The enterprise should have been involved in recycling related operation s for at least 
one year  prior to submitting a relevant  application . 
Key featur es of the assistance programme : 
 A funding limit of HK$5 million per application ; 
 A funding up to 50% of approved expenditure items;  
                                                
2 Membership of the Advisory Committee includes persons from different sectors, including management 
of housing estates and commercial venues, academics, representatives of trade and industry associations, 
relevant bureaux/departments. The Advisory C ommittee is chaired by a non -official.  G/SCM/N/315/HKG  
 
- 7 - 
 
   A maximum  of three approved projects and a cumulative  funding cap of HK$5 m illion per 
enterprise;  
 Each approved project should be completed within two years;  
 Approved f unding is provided on a reimbursement basis  
Non-profit distributing organisations  
Non-profit distributing organisations such as professional bodies, trade and indu stry organisations, 
research institutes and other industrial support organisations, either a statutory organisation or 
organisation , registered under the laws of Hong Kong .  
Key fea tures of the assistance scheme : 
 A funding limit of HK$15 million per applic ation;  
 A funding up to 100% of approved expenditure items;  
 Approved f unding is provided on a reimbursement basis.  
7. Amount  
The total amount of grant s approved  for successful  applicants for the fiscal year of 2016 -17 was 
about HK$70 million .3 
8. Duration  
The Fund was launched in October 2015 and is open for applications for five years . 
9. Statistical data permitting an assessment of the trade effects  
Not available . 
 
__________  
                                                
3 The Fund started giving approval to applications since April 2016.  As such, the amount of grants 
approved for the successful applicants for the fiscal year of 2016 -17 is also the amount of grants approved for 
succes sful applicants since the Fund ’s establishment.