Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA) - Agreement on Trade in Services

The PRC’s Ministry of Finance had made an announcement on 16 May 2016 regarding the “Support towards Hong Kong and Macau SAR’s accounting professionals practice as a partner of partnership accounting firms in Mainland”.

A new Agreement on Trade Services was signed between the Mainland, Hong Kong and Macau under framework of CEPA in November 2015 to achieve liberalisation of trade in services.

There are certain measurements under the agreement:

• Hong Kong and Macau permanent residents who have obtained the Chinese Certified Public Accountants (CPAs) qualification can be partners of partnership accounting firms in the Mainland, while the Mainland residents shall have the right of control over such accounting firms. Details of the requirement shall follow the regulations promulgated by responsible Mainland financial ministries;
• Secondly, Hong Kong and Macau permanent residents who are partners of these accounting firms are required to maintain a place of residence in the Mainland and reside in the Mainland for not less than six months every year;
• Lastly, when Hong Kong and Macau accountants apply for a practising licence in the Mainland, the length of auditing experience that they have acquired in Hong Kong is considered equivalent to the length of auditing experience acquired in the Mainland

Hong Kong and Macau accounting professional should straightly comply with the “Law of the PRC on Certified Public Accountants”, comply with and follow regulations and professional standards. The accounting professionals should follow in accordance with the Partnership Law of the PRC and properly handle the relationship with the mainland partners, to build and maintain a good partnership culture.