G/SCM/N/401/HKG  
30 June 2023 
(23-4472) Page: 1/10 
Committee on Subsidies and Countervailing Measures  Original:  English  
 
  
SUBSIDIES  
NEW AND FULL NOTIFICATION PURSUANT TO ARTICLE XVI:1 OF THE  GATT 1994   
AND ARTICLE 25 OF THE AGREEMENT ON SUBSIDIES   
AND COUNTERVAILING MEASURES  
HONG KONG, CHINA 
The following communication, dated  and received on 29 June 2023, is being circulated at the request 
of the delegation of Hong Kong , China.  
 
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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 2022-23 (i.e. 1 April 2022 - 31 March 2023). 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 . 
1  FISHERIES DEVELOPMENT LOAN FUND  
1. Title of the programme  
Fisheries Development Loan Fund.  
2. Period covered by the notification  
Fiscal year  2022-23. 
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, without increasing the overall fishing efforts, upgrad e their vessels to standards required 
for their continued operational needs , switch to more sustainable fisheries ope rations and 
other fisheries -related operations, or carry out projects that will reduce fuel consumption or 
the carbon footprint of their operations . The deadline of application was 31 December  2015; 
(b) to provide loans for capture fishermen and owners of fish  collectors to, without increasing the 
overall fishing efforts, 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 their operations ; and 
(c) to provide loans that help fish farmers develop aquaculture , or improve their aquaculture 
businesses leading 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/401/HKG  
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  4. Background and authority  
The Fund is administered by the Agriculture, Fisheries and Conservation Department  (AFCD)  to 
facilitate the sustainable development of the fisheries industry.  
5. Form 
Loan. 
6. To whom and how the assistance is provided  
Applicants for loans under 3(a) a nd 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 fisheries co -operative societies/companies with the majority of their 
members/sha reholders being local capture fishermen who fulfil the aforementioned 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/shareholders being local aquaculture 
operators who fulfil the aforem entioned 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 Loss" 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 rate s of the 
note-issuing banks in Hong  Kong.  
A one -off interest -free deferral of loan repayment for a period of one year from 1 April 2022 to 
31 March 2023  was granted to loan borrowers of the Fund for helping them tide over the period  with 
financial hardships amidst the  COVID -19 pandemic . During the period, they did not need to repay 
their loan instalments  and no  interest would  be accrued . Their repayment period would  also be 
extended accordingly.  
7. Amount  
HKD 10,370,000 . 
8. Duration  
On-going , except for 3(a) above  which is no longer open for application and will be terminated when 
all outstanding  loans are repaid . 
9. Statistical  data permitting an assessment of the trade effects  
Not available . 
2  FISH MARKETING ORGANIZATION LOAN FUND  
1. Title of the programme  
Fish Marketing  Organization Loan Fund.  
2. Period covered by the notification  
Fiscal year  2022-23. G/SCM/N/401/HKG  
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  3. Policy objective and/or purpose  
Without increasing the overall fishing efforts, 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 annual fishing moratorium.  
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 Government . AFCD and FMO are involved in the administration 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 local 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 
• fulfils other requirements as specified by FMO.  
There are two types of loans that may be granted under the Fund : (a) general loans, and ( b) special 
one-year loans for fishermen affected by the annua l fishing moratorium in the neighbouring waters . 
The interest rates applicable in the fiscal year 2022-23 were as follows:  
(a) general loans: 3.458 % per annum  for individual fishermen, and 1.958 % per annum  for 
members of registered co -operative societies  (as at 31.3.2023); 
(b) special one-year loans: 1% per annum . 
7. Amount  
The amount of loans issued  for the special one -year loans  was HKD 85,504,000 . No general loan 
was issued during the fiscal year.   
8. Duration  
On-going . 
9. Statistical data permitting an assessment of the trade effects  
Not available . 
3  KADOORIE AGRICULTURAL AID LOAN FUND  
1. Title of the programme  
Kadoorie Agricultural  Aid Loan Fund.  
2. Period covered by the notification  
Fiscal year  2022-23. G/SCM/N/401/HKG  
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  3. Policy objective and/or purpose  
To provide loans for fish farmers and farmers to meet  development and working capital  needs, 
including the purchase of necessary inputs for production such as stocks , fry and feed, as well as 
improvement of farm facilities for enhancing productivity.  
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  
Applicants must be fish farmers and farmers and the interest rates applicable in the fiscal year 
2022-23 were as follows:  
• loans not exceeding HKD 200 ,000: 0.469% per annum  for development capital, and 
0.625 % per annum  for working capital ; and 
• loans exceeding  HKD 200,000: 4.708 % per annum . 
7. Amount  
The total amount of loan issued was  HKD 3,250,000 . 
8. Duration  
On-going . 
9. Statistical data permitting an assessment of the trade effec ts 
Not available . 
4  SUSTAINABLE FISHERIES DEVELOPMENT FUND  
1. Title of the programme  
Sustainable Fisheries  Development Fund . 
2. Period covered by the notification  
Fiscal year  2022-23. 
3. Policy objective and/or purpose  
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 . Projects that may benefit from the Fund include those that provide techn ical 
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 2 012, assistance for local fishermen and aquacultu rists to modernise their 
operations and monitoring and assessment of the effectiveness of the sustainable fisheries 
management measures implemented in Hong  Kong. G/SCM/N/401/HKG  
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  4. Background and authority  
The Fund is administered by the AFCD . 
5. Form 
Grant . 
6. To whom and how the assistance is provided  
(a) Legal entities  which 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 H KSAR , 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 . 
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) . Initiatives without commercial elements will be fully funded whereas those with 
commercial elements will be funded on a matching basis , with the HKSAR Government's total 
contribution capped at  ceiling s depending on the nature of the project . The HKSAR Governme nt will 
recoup the cost commensurate with its share of contribution.  
7. Amount  
HKD 12,971,000 . 
8. Duration  
It is open for applications since July 2 014. As of December 2022, the Fund has an approved 
commitment of HKD 1 billion . Its continuation  is contingent upon the availability of fund s. 
9. Statistical  data permitting an assessment of the trade effects  
Not available . 
5  SUBSIDIES FOR FISHING VESSELS WITH MAINLAND DECKHANDS  (UNDER THE 
ANTI -EPIDEMIC FUND ) 
1. Title of the programme  
Subsidies for Fishing Vessels with Mainland Deckhands . 
2. Period covered by the notification  
Fiscal year 2022-23. 
3. Policy objective  and/or purpose  
To provide immediate relief to the owners of the fishing vessels and fish collectors with deckhands  
from Mainland China , the operation  of whom were seriously affected by the COVID -19 pandemic.  G/SCM/N/401/HKG  
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  4. Background and authority  
The Anti -epidemic Fund was established under the Financial Secretary Incorporation Ordinance 
(Cap.  1015) to  : 
(a) enhance the capability of g overnment bureaux and departments as well as other relevant 
parties in combating the epidemic ; and 
(b) provide assistance or relief to enterprises and members of the public hard hit by the present 
epidemic or affected by anti -epidemic measures.  
Most of the Hon g Kong fishing vessels and fish collectors rely on deckhands from Mainland China in 
their operation . Due to the COVID -19 pandemic, such deckhands  were unable to report duty, and 
the vessels  concerned were unable to operate for a prolonged period of time . The relief measure  to 
the owners of fishing vessels or fish collectors with deckhands from Mainland China under the 
Anti-epidemic Fund is administered by the AFCD . 
5. Form 
Grant . 
6. To whom  and how the assistance is provided  
Two separate rounds of grant of HKD 20,000 and HKD 80,000 respectively were provided to the 
owner of each fishing vessel/fish collector vessel with deckhands  from Mainland China , as they were 
more significantly affected by the pandemic.  
The relief was provided to the owners of the fishing ve ssels and fish collectors  meeting the following 
criteria : 
• the applicant is the owner of a Class III vessel licensed under the Merchant Shipping 
(Local  Vessels) (Certification and Licensing) Regulation (Cap. 548D) , i.e. fishing vessel, fish 
carrier, fishing sampan and outward open sampan ; 
• the vessel on application holds a valid permit  from Mainland China ; and 
• the applicant  employs deckhands  from Mainland China  on the subject vessel.  
7. Amount  
The total amount of special  relief issued was HKD 137,260,000 .  
8. Duration  
The first round of a pplication for the relief was open since 21 February 2022  and closed on 
20 May 2022; the second round of a pplication for the relief was open since  1 November 2022 and 
closed on 28 February 2023 . The programme will be concluded once all grants have been made.  
9. Statistical data permitting an assessment of the trade effects  
Not available . 
6  SUBSIDIES FOR LOCAL PRIMARY PRODUCERS (UNDER THE ANTI -EPIDEMIC FUND ) 
1. Title of the programme  
Subsidies for Local Primary  Producers . 
2. Period covered by the notification  
Fiscal year 2022-23. G/SCM/N/401/HKG  
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  3. Policy objective  and/or purpose  
To provide immediate financial  relief to local primary producers, the business or operation of whom 
has been affected by the COVID -19 pandemic.  
4. Backg round and authority  
The operation and business  of local primary producers have been affected by the serious and 
prolonged impact of the COVID -19 pandemic on the food business sector . The relief measures was 
established under the Anti -epidemic Fund ( details  are set out in Item 5 above) . It is administered 
by the AFCD . 
5. Form 
Grant . 
6. To whom and how the assistance is provided  
Local primary producers (including owners of vegetable farms, hydroponic farms, flower farms and 
nurseries, marine fish culture farms, pond fish culture farms, and fishing vessels /fish collector 
vessels  without deckhands  from Mainland China , but excluding livestock farms)  may apply for the 
relief. Grants are provided to applicants meeting the relevant eligibility criteria . A one-off grant of 
HKD 10 ,000 was provided to each eligible local primary producer.  
7. Amount  
The amount  of fund approved  for the fiscal year 2022-23 was HKD 51,930,000 . 
8. Duration  
Application for the relief was open since 21 February 2022  and closed on 28 February 2023 . The 
programme will be concluded once all grants have been made.  
9. Statistical data permitting  an assessment of the trade effects  
Not available . 
7  LOCAL MASK PRODUCTION SUBSIDY SCHEME  (UNDER THE ANTI -EPIDEMIC FUND)  
1. Title of the programme  
Local Mask Production  Subsidy Scheme ( LMPSS ). 
2. Period covered by the notification  
Fiscal year 2022-23. 
3. Policy objective  and/or purpose  
To provide financial incentives to facilitate the establishment of mask production facilities in 
Hong Kong so as to address the severe shortage situation and to build up stock . 
4. Background and authority  
Due to  the spread of t he COVID -19 worldwide, the demand for masks surged significantly  in the 
past few years , aggravating the acute supply shortage situation in Hong Kong which largely relied 
on import for masks and driving up prices.  
The support scheme was established under the Anti -epidemic Fund (details are set out in Item 5 
above) . The Hong Kong Productivity Council (HKPC), a statutory body established under the G/SCM/N/401/HKG  
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  Hong Kong Productivity Council Ordinance, has been commissioned to act as the Secretariat to 
administer the LMPSS . 
5. Form 
Capital support  and procurement of masks  calculated on the basis of actual costs incurred.  
6. To whom and how the assistance is provided  
All companies registered in Hong Kong with a valid Certificate of Incorporation issued by the 
Companies Registry and a valid Business Registration Certificate issued by the Inland Revenue 
Department are eligible to apply for support under the LMPSS . 
(a) The HKSAR Government  provides capital support  to a maximum of 20 production lines, 
covering cost items relevant to the establishment of a mask production line (i.e. production 
equipment, venue setup, clean room setup, and testing and standard compliance co sts). 
Based on the actual costs of setting up mask production facilities in Hong Kong, a grant of 
up to HKD 3 million  may be given to each factory for setting up one production line of masks, 
while an additional grant of up to HKD 2 million  may be given fo r an additional production 
line of the same grantee . The ceiling of grant amount for each production line is based on 
the committed monthly production output . The capital support is disbursed in four 
instalments, depending on the progress of establishing t he production lines and production 
outputs.  
(b) In addition, the HKSAR Government  procures up to two  million  masks from each production 
line every month for one year . The price of the masks is set with reference to major 
production costs and the grantees have to submit documentary proof for verification 
purposes.  
7. Amount  
In the fiscal year  2022-23, the HKSAR Government disbursed a total of HKD 11,396,000  of capital 
support  to the production lines . Since the launch of the scheme, the HKSAR Government has 
procured a total of HKD  633,802,000 of masks.   
8. Duration  
The LMPSS  was launched in March 2 020 and will be concluded after the documents submitted by 
the production lines are vetted and the capital support is disbursed.  
9. Statistical  data permitting an assessment of the trade effects  
The amount of capital support disbursed to the 20 production lines and the number of masks 
delivered to the Government are available at the dedicated website of th e HKPC 
(https://www.hkpc.org/en/our -services/additive -manufacturing/latest -information/hkpc -mask -
production -support ) and is updated monthly.  
8  CHINESE MEDICINE DEVELOPMENT FUND  
1. Title of the programme  
Chinese Medicine  Development Fund . 
2. Period covered by the notification  
Fiscal year  2022-23. 
3. Policy objective  and/or purpose  
To enhance  the overall standards of the Chinese medicine (CM) sector , encourage CM -related 
scientific research , and promote public knowledge and understanding of CM.  G/SCM/N/401/HKG  
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  4. Background  and authority  
The Fund was established in June 2 019 with a non -recurrent commitment of HKD 500 million  by the 
HKSAR Government . It is managed by the Health Bureau . An Advisory Committee has been set up 
to advise and make recommendations to the HKSAR Government on matters relating to the overall 
administration and oper ation of the Fund . Two categories of funding programmes have been 
established under the Fund.  
Enterprise Support Programme  
It provides matching funds for individual Chinese medicine practitioners (CMPs) and clinics, members 
of the CM industry and CM drug t raders to enhance the professional and manufacturing standards 
as well as management quality of CM drug and help them with registration of proprietary 
Chinese  medicines (pCms ) in accordance with statutory requirements, such as offering technical and 
hardware support to manufacturers of pCms to assist them in conforming with the Good 
Manufacturing Practices (GMP) standard.  
Industry Support Programme  
It provides funding for non -profit -making organisations, professional bodies, trade and academic 
associations and research institutions to support training programmes and courses to nurture talent 
for the future Chinese Medicine Hospital and facilitate development of CM, conduct appl ied or policy 
research on CM, and organise various CM promotional activities.  
Other Support  
As technical support to the CM industry, a CM resources platform has been established under the 
Fund to provide practical information  and latest updates.   
5. Form 
Grant. 
6. To whom and how the assistance is provided  
Enterprise Support Programme  
It provides financial  support  to the following:  
(a) CMPs and persons  engaged in the CM drug industry for training to enhance professional 
capabilities;  
(b) CM clinics  to improve clinic facilities;  
(c) CM drug traders to improve warehouse and logistics facilities ; and 
(d) manufacturers to enhance manufacturing quality and management systems of pCms in 
conforming with the GMP standard  and manufacturers/wholesalers to register pCms in 
accordance with statutory requirements.  
Approved funding  is provided on a reimbursement basis with the following funding limits:  
(a) for (a), the funding  ratio is 60 % or 90% with funding limit ranges from HKD 1 ,000 to 
HKD 60,000 per person depending on the nature of the courses;  
(b) for (b), the funding ratio is 50 % or 80% depending on the nature of the facilities with funding 
limit capped at HKD 25 ,000 per clinic;  
(c) for (c), the funding ratio is 50 % or 80% depending on the nature of the facilities with funding 
limit capped at HKD 100 ,000 per licensee ; and 
(d) for (d), as far as  enhancement of manufacturing quality and management systems of pCms 
is concerned, the funding ratio is 50 % or 90% with funding limit ranges from HKD 30 ,000 G/SCM/N/401/HKG  
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  to HKD 600 ,000 per manufacturer under various schemes depending on the nature of 
subsidised items . For facilitation of pCm registration, the funding ratio is 50 % with funding 
limit capped at HKD 20 ,000 for each pCm and HKD 200 ,000 for each pCm manufacturer or 
wholesaler . 
Industry Support Programme  
It provides  financial support to non-profit -making organisations, professional bodies, trade and 
academic associations and research institutions , either a statutory organisation or an organisation 
registered under the laws of Hong Kong.  
Approved funding is provided e ither in advance (by instalment) or on a reimbursement basis, 
depending  on fulfilment of certain administrative requirements . It funds up to 100 % of approved 
subsidised items, with the following funding limits:  
• a funding limit of HKD 2 ,750,000 per applicat ion relating to CM industry training programmes;  
• a funding limit of HKD 750 ,000 per application relating to CM promotion ; and 
• a funding limit of HKD 2 ,000,000 per application relating to CM applied studies and research . 
7. Amount  
In the fiscal year 2022-23, a total of around  HKD 132,330,000  of fund was approved  under different 
funding schemes of the Fund . 
8. Duration  
On-going.  
9. Statistical  data permitting an assessment of the trade effects  
Not available . 
 
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