WORLD TRADE  
ORGANIZATION  G/SCM/N/123/HKG 
9 February 2006 
 (06-0572) 
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 8 February 20 06, is being circulated at the request of the 
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 2004-05.  In accordance with Article 25.7 of the ASCM, the 
notification of the measures concerned does not prejudge  either their legal status, effects or nature 
under GATT 1994 and the ASCM G/SCM/N/123/HKG 
Page 2  
 
  A. 
 FISHERIES DEVELOPMENT LOAN FUND 
1. Title of the programme 
 Fisheries Development Loan Fund 
 
2. Period covered by the notification 
 Fiscal year 2004-05 (i.e. April 2004 – March 2005) 
 
3. Policy objective and/or purpose 
 To facilitate the sustainable development of local fishery industry by providing loans to 
fishermen for meeting their development needs.  Specifically, loans are issu ed for activities necessary 
for facilitating fishermen to develop or shift to su stainable fishing operations, e.g. hull modification, 
purchase of fishing gear, equipment and vessels, etc.   
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 must be (i) a member of register ed fishermen’s co-operative society; (ii) an 
individual fisherman; or (iii) a registered fishing company.   
 
 The loan is granted at an interest rate of  6% per annum (Note:  The best lending rates 
available on the local commercial market ranged ge nerally between 5% and 5.25% per annum during 
the fiscal year 2004-05). 
 
7. Amount 
The total amount of loans approved for the fiscal year 2004-05 was HK$ 3,980,000.    
 
8. Duration 
 This is an on-going scheme. 
 
9. Statistical data permitting an assessment of the trade effects 
 No data available. 
  
B. F
ISH MARKETING ORGANIZATION LOAN FUND 
1. Title of the programme 
 Fish Marketing Organization Loan Fund 
  G/SCM/N/123/HKG 
 Page 3 
 
 
  2. Period covered by the notification 
 Fiscal year 2004-05 (i.e. April 2004 – March 2005) 
 
3. Policy objective and/or purpose 
 To provide loans to fishermen for meeting their production and sustainable development 
needs, including repair and replacement of fishing vessels, gear and equipment.   
 
4. Background and authority 
 The fund has been set up by the Fish Marketing Organization, a statutory body established by 
the authority of the Marine Fish (Marketing) Ordinance (Chapter 291). 
 
5. Form  
 Loan 
 
6. To whom and how the assistance is provided 
 Applicants may include (i) a member of regist ered fishermen’s co-operative society; (ii) an 
individual fisherman; or (iii) a registered fishing company.   There are three types of loan s that may be granted under the Fund: normal loans, special one-
year loans for fishermen affected by the two-mont h annual fishing moratorium in the South China 
Sea, and special loans for facilitating the developm ent of offshore fishing.  The interest rates 
applicable in the fiscal year 2004-05 were as follows: 
 
• normal loans:  2.75% to 3% per annum for individual fishermen (best lending rate 
available on commercial market minus 2.25%), and 1.25% to 1.5% per annum for members of registered cooperative societies (best lending rate available on commercial market minus  3.75%);   
 
• special one-year loans for fishermen affe cted by the annual moratorium:  2%; 
 
• special loans for development of offshore fishi ng: the loan applicant is allowed to opt an 
interest rate either fixed at 6% or based on the “No Gain No Loss” principle of the Hong 
Kong Special Administrative Region Government .  On the latter, the “No Gain No Loss” 
rate is set by taking into account such factors as the best lending rates of the note-issuing 
banks in Hong Kong. 
 
7. Amount 
 The amount of loans approved for the fiscal year 2004-05 were as follows: 
 
• normal loans: HK$ 2,635,000  
 
• special loans for fishermen affected by the annual moratorium: HK$ 25,980,000  
 
• special loans for development of offshore fishing: Nil  
 G/SCM/N/123/HKG 
Page 4  
 
  8. Duration 
 This is an on-going scheme. 
 
9. Statistical data permitting an assessment of the trade effects 
 No data available. 
 
 C. K
ADOORIE AGRICULTURAL AID LOAN FUND 
1. Title of the programme 
 Kadoorie Agricultural Aid Loan Fund 
 
2. Period covered by the notification 
 Fiscal year 2004-05 (i.e. April 2004 – March 2005) 
 
3. Policy objective and/or purpose 
 To provide loans to fish farmers and fa rmers for development and working capital.  
Specifically, loans are issued fo r purchase of livestock, fry, feed and farm equipment, and 
maintenance of farms.  
4. Background and authority 
 The fund has been established under the Kadoorie Agricultural Aid Loan Fund Ordinance 
with donations from both non-govern ment sources and the 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 2004-05 were as 
follows:  
• loans not exceeding HK$100,000: 0.0075% to  0.09375% per annum for development 
capital (3/4 of the average bank savings depos it rate), and 0.01% to 0.125% per annum for 
working capital (average bank savings deposit rate); 
 
• loans between HK$100,000 and HK$160,000: 2. 005% to 2.625% per annum [before 
October 2004: 1/2 x (average  bank savings deposit rate plus average best lending rate 
available on commercial market); and with eff ect with October 2004: 1/2 x (average bank 
savings deposit rate plus average best lending rate available on commercial market 
minus 1%)], and  
 
• loans at HK$160,000 and above: 4% to 5.125% per annum (before October 2004: 
average best lending rate available on commerc ial market; and with effect from October 
2004: average best lending rate available on commercial market minus  1%). 
  G/SCM/N/123/HKG 
 Page 5 
 
 
  7. Amount 
 The amount of loans approved for the fiscal year 2004-05 was HK$9,900,000. 
 
 In addition, special loans, at a total amount of HK$2,130,000, were issued to mariculturists 
affected by cold spell in 2004.   
 
8. Duration 
 This is an on-going scheme. 
 
9. Statistical data permitting an assessment of the trade effects 
 No data available. 
  
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