WT/REG356/M/1  
 
12 October 2015  
(15-5325)  Page: 1/4  
Committee on Regional Trade Agreements 
Seventy-eighth Session   
 
 FREE TRADE AGREEMENT BETWEEN HONG KONG, CHINA AND CHILE,  
GOODS AND SERVICES 
NOTE ON THE MEETING OF 25 SEPTEMBER 2015 
Chairman: Ambassador Amr RAMADAN (Egypt) 
1.1.  The 78th Session of the Committee on Regional Trade Agreements (hereinafter 'CRTA' or the 
'Committee') was convened in Airgram WTO/AIR/RTA/3 dated 12 August 2015. 
1.2.  Under Agenda Item B.IV of the session , the CRTA considered the Free Trade Agreement 
between Hong Kong, China and Chile, goods and services (hereinafter "the Agreement"). 
1.3.  The Chairman said that the Agreement had entered into force on 9 October 2014. It had 
been notified to the WTO by the Parties on 15 October 2014 under Article XXIV:7(a) of the GATT 
1994 and the Understanding on the Interpretation  of Article XXIV of GATT 1994 as an Agreement 
establishing a free trade area (document WT/REG356/N/1) and under GATS Article V:7(a) as an 
Agreement providing for the liberalization of trade in  services within the meaning of Article V of the 
GATS (document S/C/N/773). The text of the Agreement was available, together with its Annexes, 
on the Parties' official websites. The Factual Presentation on the goods and services aspects 
(document WT/REG356/1 dated 8 July 2015) had been  prepared by the Secretariat on its own 
responsibility in full consultation with the Parties, in accordance with paragraph 7(b) of the Transparency Mechanism for Regional Trade Ag reements (document WT/L/671). In addition, 
written questions and replies on this Agreemen t had been distributed in document WT/REG356/2 
dated 17 September 2015. He proposed to organize the consideration of the Agreement by first asking the Parties and then other Members to give any general comments and then turn to the 
specifics of the Agreement. 
1.4.  The representative of Chile thanked the Se cretariat for preparing the Factual Presentation 
and the European Union, Thailand, Chinese Taipei and Mexico for their interest in the Agreement 
and for their advance questions. He was please d by the excellent coordination and close and 
fruitful cooperation throughout the process with  the Hong Kong, China Mission, headed by its 
Permanent Representative Irene Young. He was particularly pleased by Ms Sylvia NG's presence in the CRTA meeting. 
1.5.  Chile concurred with Hong Kong, China, on the principles of the multilateral trading system; 
their economies leaned towards free trade and the reduction of tariff barriers in the WTO and both participated actively in the APEC forum. Chile valued Hong Kong, China as one of the most open 
and competitive economies in the world and commended it for becoming a significant power in 
trade in services, especially financial, air and maritime services. 
1.6.  Since 2010, Chile and the Hong Kong, China had concluded double taxation exemption 
agreements for shipping companies and had conducted wine promotion initiatives. There was a 
willingness to strengthen ties in sectors such as air transport, education, culture, tourism, and 
science and technology. A "working holiday" agreement on youth mobility was currently being finalized. Proof of the close trade relationship be tween Chile and Hong Kong, China, was the recent 
visit to Chile by Hong Kong, China's Secretary for Commerce and Economic Development, for the 
purpose of expanding economic and commercial ties and, especially, advancing the implementation of the Agreement while encouragin g activities such as tourism exchange, support 
to SMEs, technology transfer and industrial innovation. WT/REG356/M/1 
 
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  1.7.  In 2011, the investment promotion agencies of Chile (CIE Chile) and Hong Kong (InvestHK) 
had signed a Memorandum of Understanding – the first of its kind between InvestHK and a Latin American counterpart – with a view to promoting and developing activities to promote investment. 
That same year the Chilean Business Association of Hong Kong, China and Macau, China had been 
formally established, initially drawing together 15 Chilean professionals resident in those places 
with a view to enhancing the economic, commercial and financial influence of their companies in the region, were they (from the Chilean perspectiv e) importers, exporters or service providers. 
1.8.  In 2012, Chile had signed the Agreement wh ich was the first agreement of its kind between 
Hong Kong, China and a country in the Americas, and had entered into force in October 2014. The Agreement contained chapters on, inter alia , trade in goods, trade in services, rules of origin, 
customs cooperation, sanitary and phytosanitary measures, technical barriers to trade, 
government procurement, trade remedies, and financial services. The two parties had also 
concluded a Memorandum of Understanding on Labour Cooperation. 
1.9.  Chile and Hong Kong, China had agreed that following the entry into force of the Agreement, 
negotiations would begin on an Investment Agreement aimed at promoting and protecting 
investment in both economies. The first round of negotiations had taken place in Hong Kong, China in February 2015. In addition, Chile's Internal Revenue Service was interested in concluding 
a tax information exchange agreement with Ho ng Kong, China, to strengthen trade and 
investment flows between both economies in view of their openness. 
1.10.  Since around 6,600 foreign and Chinese companies had their headquarters in Hong Kong, 
China, different Chilean companies could benefit fr om the region's knowledge and experience as a 
business hub. Chile was interested in strengthen ing its cooperation with Hong Kong, China in 
financial matters such as banking, initial public offerings, stock market information, and listing Chilean companies on the Hong Kong Stock Exchan ge. Since June 2014, a representative office of 
a Chilean bank had been operational in Hong Kong, China's financial centre. 
1.11.  Chile recognized Hong Kong, China as a major market for its fruit, wine, meat, and sea 
product exports, as well as other more sophisticated and complex products. These products had 
been exhibited at trade fairs such as Asia Fruit Logistica and the Hong Kong International Wine 
and Spirits Fair. In 2014, the volume of bilateral trade had reached US$318 million, an 8% increase on the previous year. This reflected the fact that new products had been incorporated into Chile's export basket, including cherries, crabs, animal feed, nuts and blueberries. 
1.12.  Finally, the entry into force of the FTA had created added value by promoting and 
strengthening the presence of Chilean products in Asia, and Chile hoped to provide a good platform in the American region for goods, serv ices and financial centres of Hong Kong, China. 
1.13.  The representative of Hong Kong, China was pleased to take part in the meeting to consider 
the Free Trade Agreement between Hong Kong, Ch ina and Chile and thanked the Secretariat for 
preparing the Factual Presentation which concisel y captured the key elements of the Agreement. 
She also thanked her Chilean counterparts, including Mr. Jorge Vidal, for the joint preparatory 
work for the meeting.  
1.14.  The Agreement was Hong Kong, China's first FTA with a Latin American economy. It was an 
important milestone in its trade relationship with the American region. Chile was a close and 
valued trading partner of Hong Kong, China. Both  parties were strong advocates and practitioners 
of free and open trade and investment, and had been working side by side in numerous international fora. Hong Kong, China considered that the Agreement further strengthened both 
parties' partnership and served as a platform to take their bilateral economic relations to a new 
level, offering a wealth of opportunities for their businesses and investors.  
1.15.  When entering into the Agreement, Hong Kong, China and Chile had taken their rights and 
obligations under the WTO Agreements seriously, especially those pertaining to free trade areas 
and economic integration agreements in GATT Article XXIV and GATS Article V. The Agreement was fully consistent with the provisions of the WTO. It was comprehensive and of high quality, 
encompassing trade in goods and services, in vestment, and other trade related areas.  WT/REG356/M/1 
 
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  1.16.  On trade in goods, the Agreement provided full certainty to exporters. Hong Kong, China 
had bound its existing zero import tariff regime for all goods originating from Chile, going beyond its commitments under the WTO. Reciprocally, 98% of Chile's tariff lines would become duty free for products originating from Hong Kong by 1 January 2016.  
1.17.  The Agreement included provisions for disciplines additional to the relevant WTO 
Agreements on the application of trade remedy measures. There were also provisions for enhanced communication and cooperation in the areas of sanitary and phytosanitary measures, technical 
barriers to trade, and for mutual cooperation in the administration of customs matters to ensure 
that customs procedures and practices for goods traded between the two sides were predictable, consistent, transparent and trade facilitating. 
1.18.  On trade in services, the Agreement covered a comprehensive range of services sectors. 
Many of the commitments made by Hong Kong, China and Chile went beyond the existing 
commitments of the parties under the GATS. Some even exceeded the level of commitments offered under the Doha Round negotiations.  
1.19.  Apart from market access commitments, the parties had agreed on other general 
obligations to facilitate their trade in services. Regarding domestic regulation in particular, the domestic regulation Article in the Services Chapter, which built on the relevant provisions in the 
GATS, required the parties to ensure that measures affecting trade in services, including those 
relating to licensing, qualification requirements and procedures and technical standards, were administered in a reasonable, objective and impartial manner and were transparent and did not become unnecessary barriers to trade.  
1.20.  On investment, the Agreement provided inve stors of both parties with legal certainty on 
national treatment in respect of their investments in specified non-services sectors. To further enhance mutual investment flows, Hong Kong, China and Chile had commenced negotiations on an 
investment agreement. This agreement, which would form part of the Agreement, would give 
investors an assurance that their investments in the other party enjoyed fair treatment and protection. 
1.21.  Furthermore, the Agreement contained prov isions to promote competition and to encourage 
cooperation and information exchange between the parties' competition authorities. The parties had also agreed on rules governing their government procurement activities, including non-discrimination and transparency in the proce ss. They had also agreed on a set of shared 
principles and measures, encouraging sound environmental policies and practices, to promote 
environmental protection. Commitments and cooperation in these areas were in line with WTO Agreements and would have the positive effect of facilitating bilateral trade and investment flows. 
1.22.  The Agreement had entered into force in early October 2014 and hence was approaching its 
anniversary. Hong Kong, China strongly believed th at the Agreement would provide it with better 
access to the Chilean market, which potentially served as a gateway to the Central and South 
American markets. It created more business opportunities beneficial to its long-term economic 
growth, and it further strengthened its position as an international trade, commerce and investment centre. Hong Kong, China also hoped that all FTAs including the Agreement, which 
were based on WTO disciplines, would be conducive to further multilateral trade liberalization.  
1.23.  Finally, Hong Kong, China thanked Members for their interest in the Agreement and 
especially the delegations of the European Union, Chinese Taipei, Thailand and Mexico for their written questions, to which joint written replies had been circulated prior to the meeting. She 
looked forward to a fruitful discussion and would listen carefully to any comments made by 
Members.  
1.24.  The representative of the European Union thanked the parties for their participation in the 
review and the Secretariat for its work in preparing the Factual Presentation. She appreciated the 
presentations delivered by the parties which had br ought interesting insights into the Agreement. 
She thanked them for their replies and confirmed that the EU did not have any follow-up questions. WT/REG356/M/1 
 
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  1.25.  The representative of the United States thanked the parties for their participation and hard 
work in preparing for the review and the Secret ariat for their work in preparing the Factual 
Presentation. The U.S. commended the parties for the excellent and comprehensive tariff coverage and for the Agreement in general. The Committee' s discussion had been useful and informative 
and appreciated the parties' efforts to info rm the Committee and share the context of the 
Agreement. He did not have follow-up questions. 
1.26.  The Chairman said that consideration of the goods and services aspects of the Free Trade 
Agreement between Hong Kong, China and Chile ha d allowed the Committee to clarify a number of 
questions and the oral discussion of the RTA could be concluded in accordance with paragraph 11 of the Transparency Mechanism. If any delegations wished to ask follow up questions they were invited to forward submissions in writing to th e Secretariat by 1 October 2015 and Parties were 
asked to submit replies in writing by no la ter than 15 October 2015. In accordance with 
paragraph 13 of the Transparency Mechanism all written submissions, as well as minutes of the 
meeting would be circulated promptly, in all WTO official languages, and would be made available 
on the WTO website.  
1.27.  The Committee took note of the comments made. 
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