Pressure on HK Government as HKSOA joins call for maritime reform

HKSOA chairman, Jack Hsu

The Hong Kong Shipowners Association yesterday echoed a call for top to bottom reform of the territory’s maritime sector, issued by the Financial Services Development Council on Monday.

“The HKSOA shares the FSDC’s concern that Hong Kong must expedite efforts to build a base for commercial principals, including ship owners, lessors, carriers, investors, operators and ship-management companies, with a view to attracting more service providers to Hong Kong and expanding its maritime cluster,” the Association said.

“Commercial principals are the drivers of the maritime business. Hong Kong, in particular, needs commercial principals to maintain and grow its maritime presence,” said Mr Jack Hsu, Chairman of the Association. “If more commercial principals are attracted to Hong Kong, it makes commercial sense for the related service providers to follow. From time to time, we come across principals from both overseas and the Mainland of China that are interested in setting up operations or regional offices in Hong Kong, as long as the city provides a stable tax and investment environment.”

The HKSOA supports the various recommendations in the FSDC’s paper including, among others, urging the Government to ensure the stability, consistency and transparency of Hong Kong’s section 23B tax regime; to conduct a full consultation with the industry during the Government’s preferential tax regime review; to reduce the standard profits tax rate for qualified ship leasing management activities and shipping-related support services; to conclude more double tax agreements with major shipping jurisdictions; and to upgrade the efficacy of the Hong Kong Maritime and Port Board.

At this stage it is difficult to assess to what extent the demands of the FSDC amount to little more than a wish list or whether a finger on the pulse of the Government’s thought processes means that there is real confidence in what can be achieved. For a number of months there has been a growing rumour that HKSAR chief executive, Carrie Lam is preparing to make an ambitious statement that will directly benefit what is currently a disgruntled maritime sector.

One observer told hongkongmaritimehub that a likely date for the announcement would be August 2018.

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