### Inland Revenue Ordinance 《稅務條例》

14Y. Anti-avoidance provisions relating to arm’s length principle—ship leasing
(Amended 10 of 2022 s. 2)(1) Subsection (2) applies if—
(a) conditions are made or imposed between a corporation that is a qualifying ship lessor and a person who is an associate of that corporation, in their commercial or financial relations in connection with a qualifying ship leasing activity; and
(b) the conditions differ from those that would be made if the person were not such an associate.
(2) Any profits that, but for the conditions referred to in subsection (1)(a), would have accrued to the corporation or the person and, by reason of those conditions, have not so accrued, are to be included in the profits of the corporation or the person and taxed in accordance with this Part.
(3) Subsection (4) applies if—
(a) conditions are made or imposed between a corporation that is a qualifying ship leasing manager and a person who is an associate of that corporation, in their commercial or financial relations in connection with a qualifying ship leasing management activity; and
(b) the conditions differ from those that would be made if the person were not such an associate.
(4) Any profits that, but for the conditions referred to in subsection (3)(a), would have accrued to the corporation or the person and, by reason of those conditions, have not so accrued, are to be included in the profits of the corporation or the person and taxed in accordance with this Part.
(Added 5 of 2020 s. 5)

14Z. Anti-avoidance provisions relating to release of ownership obligation—ship leasing
(Amended 10 of 2022 s. 2)If—
(a) a ship is owned by a corporation that is a qualifying ship lessor under an arrangement (ownership arrangement

### Inland Revenue Ordinance 《稅務條例》

14ZA. Anti-avoidance provisions relating to arrangement to obtain tax benefit—ship leasing
(Amended 10 of 2022 s. 2)(1) If—
(a) a corporation that is a qualifying ship lessor or qualifying ship leasing manager enters into an arrangement; and
(b) the Commissioner is satisfied that the main purpose, or one of the main purposes, of the corporation in entering into the arrangement is to obtain a tax benefit, whether for the corporation or another person, in relation to a liability to pay profits tax under this Ordinance,
sections 14P(1) and 14T(1) do not apply in relation to any assessable profits accrued to the corporation during a basis period relevant to the arrangement.
(2) If—
(a) a corporation that is a qualifying ship lessor enters into an arrangement; and
(b) the Commissioner is satisfied that the main purpose, or one of the main purposes, of the corporation in entering into the arrangement is to obtain a tax benefit, whether for the corporation or another person, under a tax treaty that is contrary to the purpose of the treaty,
section 14P(1) does not apply in relation to any assessable profits accrued to the corporation during a basis period relevant to the arrangement.
(3) For the purposes of this section, the basis period of a year of assessment is relevant to an arrangement if, in the opinion of the Commissioner, the arrangement has effect during that basis period.
(4) In this section—
tax benefit (稅務利益) means an avoidance, postponement or reduction of a liability to pay tax;
tax treaty (稅收協定) means an arrangement made between 2 or more jurisdictions (whether including Hong Kong or otherwise) with a view to affording relief from double taxation.
(Added 5 of 2020 s. 5)

14ZB. Power to amend Schedule 17FA
(Amended 10 of 2022 s. 2)The Commissioner may by order published in the Gazette amend Schedule 17FA.
(Added 5 of 2020 s. 5)

### Inland Revenue Ordinance 《稅務條例》

14ZC. Interpretation of Subdivision 6 of Division 2 of Part 4
(1) In this Subdivision—
qualifying ship agency activity (合資格船舶代理活動)—see subsection (3);
qualifying ship agent (合資格船舶代理商)—see section 14ZD(4);
ship agency activity (船舶代理活動)—see section 2 of Schedule 17FB.
(2) Also, Part 1 of Schedule 17FB contains interpretation provisions that apply to this Subdivision in accordance with their terms.
(3) A ship agency activity carried out by a corporation is a qualifying ship agency activity if the activity is carried out in the ordinary course of the corporation’s business carried on in Hong Kong.
(4) A note located in the text of this Subdivision is provided for information only and has no legislative effect.

14ZD. Concession for qualifying ship agent
(1) For the purposes of this Part and subject to subsections (7) and (9), the assessable profits of a corporation that is a qualifying ship agent for a year of assessment are chargeable to tax under this Part at—
(a) to the extent to which those profits are assessable profits derived from its qualifying ship agency activity—
(i) that is carried out for its associated qualifying ship lessor; or
(ii) that is carried out—
(A) for its associated qualifying ship leasing manager; and
(B) in respect of that manager’s qualifying ship leasing management activity carried out for that manager’s associated qualifying ship lessor—
the rate specified in Schedule 8C; or
(b) to the extent to which those profits are assessable profits derived from its qualifying ship agency activity other than one mentioned in paragraph (a)—one-half of the rate specified in Schedule 8.
(2) In ascertaining the assessable profits of a corporation for the purposes of subsection (1), there are to be excluded, to the extent specified in subsection (3), any profits derived by the corporation from its qualifying ship agency activity that is carried out—
(a) for its connected person that is a ship operator; and
(b) in respect of any activity carried out by the connected person in the operation of a ship.
(3) The extent specified for subsection (2) is the extent to which the activity mentioned in paragraph (b) of that subsection generates income—
(a) that is a sum falling within paragraph (a) or (b) of the definition of exempt sums

14ZE. Safe harbour rule—qualifying ship agent
(1) For the purposes of section 14ZD(4)(b), a corporation satisfies the safe harbour rule for a year of assessment (subject year