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Guangdong-Macao In-Depth Cooperation Zone in Hengqinn

New Momentum

 

Guangdong-Macao In-Depth Co-operation Zone in Hengqin

Mutual discussion, joint construction, joint administration and shared benefits

The “Master Plan of the Development of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin” promulgated on 5 September 2021 marks the significant deployment of the central government in supporting the moderate economic diversification of Macao and enriching the practices of the “One Country, Two Systems” policy, which will inject new impetus into the long-term development of Macao.

 

The development of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin is a key initiative in the in-depth implementation of the “Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area”, which will inject a new impetus into the long-term development of Macao, and provide it with a new space and create new opportunities. It will also be conducive to the improvement of Macao residents’ livelihoods, long-term prosperity and stability of the Macao SAR, and the city’s integration into the overall national development.

“Master Plan of the Development of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”

https://www.hengqin.gov.cn/macao_zh_hans/zwgk/zcfg/zyzc/content/post_2986630.html

 

 

Strategic Positioning

  • A new platform to promote Macao’s moderate economic diversification.
  • A new space to improve Macao residents’ quality of life and employment.
  • A demonstration base to enrich the practices of the “One Country, Two Systems” policy.
  • A new frontier to facilitate the construction of the Guangdong-Hong Kong-Macao Greater Bay Area.

Development Goals

  • By 2024: Mutual discussion, joint construction, joint administration and shared benefits mechanism will be in smooth operation in the Co-operation Zone; the integrated development paradigm of Hengqin and Macao will be preliminarily established; the supporting effect on Macao’s moderate economic diversification will start to be manifested.
  • By 2029: A regime that allows for the highly Co-ordinated economies and regulations between the Co-operation Zone and Macao will be fully established; featured industries will have undergone large-scale development; the integrated development of Hengqin and Macao will be further improved; more evident results will be seen from the promotion of Macao’s moderate economic diversification.
  • By 2035: The strong vitality and ascendancy of the “One Country, Two Systems” policy will be fully manifested; the economic strength and technological competitiveness of the Co-operation Zone will be boosted drastically; the integrated development system and mechanism of Hengqin and Macao will be more mature; the development goals for Macao’s moderate economic diversification will be basically achieved.

Coordinated Development of Macao and Co-operation Zone industry

Development of Emerging Industries for Promoting Macao’s Appropriate Economic Diversification

  • Macao

Giving full play to its strengths and its strategic positioning as “One Centre, One Platform, One Base”, Macao has adopted the “1+4” industries development strategy to achieve the appropriately diversified economy. Taking the “World Centre of Tourism and Leisure” as the “1”, Macao will step up its efforts to nurture the “4” major industries, namely, the traditional Chinese medicine and Big Health, modern financial services, high technology, exhibitions and conventions, commerce and trade, and culture and sports, in order to foster more economic boosters and to construct an appropriately diversified and sustainable industrial structure.

  • Guangdong-Macao In-Depth Co-operation Zone in Hengqin

Closely relates itself to the roadmap of Macao’s appropriate economic diversification strategy, and focuses on the tactic positioning of the four emerging industries and four main tasks. Great efforts will be made in the development of the four emerging industries – scientific and technological research and high-end manufacturing; traditional Chinese medicine and other Macao brand industries; cultural tourism, MICE, and commercial and trade industries; and modern financial services, in order to accelerate Macao-Hengqin integrated development and to jointly create a first-class business environment that is market-oriented, international and adopts the rule of law.

Macao: 1+4 development strategy for appropriately diversified economy (traditional Chinese medicine and Big Health, modern financial services, high technology, exhibitions and conventions, commerce and trade, and culture and sports, integrated tourism and leisure industries)

Guangdong-Macao In-Depth Co-operation Zone in Hengqin: Four emerging industries (Traditional Chinese Medicine and other Macao brand industries, cultural tourism, MICE, and commercial and trade industries, technology R&D and high-end manufacturing, and modern financial services)

Business Strengths of Guangdong-Macao In-Depth Co-operation Zone in Hengqin

  • New mechanism for mutual discussion, joint construction, joint administration and shared benefits
    • The administrative committee for the Co-operation Zone is run under a dual director system, jointly led by the Governor of Guangdong Province and the Chief Executive of Macao SAR.
    • An executive committee is set up under the administrative committee of the Co-operation Zone, to execute the duties related to international roadshow, investment promotion, industry introduction, land development, project construction, and livelihood management.
    • The land allocated in Hengqin in the future will be directly used for facilitating Macao’s appropriate economic diversification.
  • Implementation of “Pledge-and-approval” Market Access System
    • Implementation of the “Pledge-and-approval” System to gradually lift restrictions on trade investment, such as qualification requirements, shareholding ratio and industry access.
    • Establishment of regulatory standards and normative systems that are compatible with counterparts in Macao and around the world.
  • Implementation of the “Duo 15%” Preferential Tax Policy
    • Business Income Tax Incentive Policy:
      Eligible industries and enterprises in Hengqin are subject to a reduced tax rate of 15% on business income tax, so that such favourable policy will benefit all industries conducive to Macao’s appropriate economic diversification.
    • Individual Income Tax Incentive Policy:
      High-end talent and in-demand talent from home and abroad who are working in Hengqin will be exempt from paying individual income tax for the part of their income that exceeds 15% of the payable amount.

The implementation of the hierarchical management and closed customs operations in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

The Guangdong-Macao In-Depth Co-operation Zone in Hengqin officially implemented hierarchical management and closed customs operations at midnight on 1 March 2024, enabling a highly convenient access for personnel as well as the relaxed control over goods crossing the “first boundary” and the tightened control over goods crossing the “second boundary” in Hengqin.

  

Tariff-free (Bonded) Measures Conducive to the Diversified Development

  • Principle
    • A wide range of applicable entities for tariff-free (bonded) goods
    • The scope of tariff-free (bonded) goods is no longer limited to “production-related usage”, which is conducive to business entities that need to import machines and equipment for their own use.

 

  • The “first boundary” is set between Hengqin and Macao SAR
  • The “second boundary” is set between Hengqin and the other regions in mainland China (7 channels)

Shizimen Tunnel

Hengqin Bridge

Hengqin Tunnel

Shenjing Passage

Urban Rail Hengqin Station

Hengqin Terminal

Urban Rail Chimelong Station

Facilitating Measures for Enterprises

 

Business Goods

  • Entering the Co-operation Zone from Macao through the “first boundary”
    • The scope of “first boundary” bonded goods has been expanded to all categories, which is conducive to business entities that need to move their goods across the boundary temporarily.
    • Simplified declarations implemented for some “first boundary” tariff-free (bonded) goods, which will greatly streamline the customs procedures.
    • Tariff-free Imported Goods:Imported machines and equipment for self-use (excluding transportation equipment such as airplanes, automobiles, ships, and yachts), moulds, parts for repairing the above goods, and infrastructure materials (excluding interior decoration and rennovation materials)
    • Bonded Imported Goods:
      Other Goods

 

  • Entering other the regions in mainland China from the Co-operation Zone through the “Second Boundary”
    • Goods processed in the Co-operation Zone with added value that reaches or exceeds 30%
    • Goods manufactured by enterprises in the Co-operation Zone using imported materials, with 30% or above value added to the original value of the imported materials, can be exempt from tariffs when being imported into the other regions in mainland China through the “second boundary”, which is conducive to Macao brand industries and manufacturing entities such as technology R&D, and traditional Chinese medicine (the import-related value-added tax and consumption tax will be levied in accordance with the related regulations).

 

Personnel Access:

“Integrated Inspection” customs clearance system is adopted for the “first boundary”, and no restrictions are imposed on the personnel access through the “second boundary”

 

 

The Policies of the Hierarchical Management and Closed Customs Operations in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

  1. I. Goods
    1. Notice on Import and Export Tariff Policies for Goods in the Guangdong-Macao In-Depth Cooperation Zone in Hengqin
    2. Notice on Adjusting the Scope of Goods for VAT and Consumption Tax Refund in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
    3. Announcement of the “Regulations of the Customs of the People’s Republic of China on the Administration of Tariff-Free Imports of Goods from the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”
    4. Announcement of the “Customs Measures of the People’s Republic of China on the Collection and Administration of Taxes on Domestic Sales of Value-Added Goods Processed in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”
    5. Announcement of Simplified Declaration Requirements for Tariff-free (Bonded) Goods in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

  1. II. Items
    1. Notice on tax policies for personal luggage and mailed items in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
    2. Announcement of the standards of identifying the source and tax payment of items entering the mainland through the “second boundary” of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
    3. Announcement on allowing Macao residents to bring animal and plant products into the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

III. Integrated Management

  1. Announcement of the “Customs Supervision on the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”
  2. Announcement on the “second boundary” passage function of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
  3. Announcement on the ways of leaving the island for personnel and vehicles through the “second boundary” passages of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
  4. Joint issuance of the “Management Measures and Use of Credit Information for ‘second boundary’ Closed Customs Operations in the Guangdong-Macao In-Depth Cooperation Zone in Hengqin (Interim)”
  5. Joint issuance of the “Guidelines for the Application and Management of Credit Pass Lists for ‘second boundary’ Passages of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin (Interim)”

 

Hierarchical Management and Closed Customs Operation Website for Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

 

Smart Port Public Service Platform of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

 

In order to ensure the smooth implementation of the hierarchical management of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin, and to allow a highly convenient access for personnel as well as the relaxed control over goods crossing the “first boundary” and the tightened control over goods crossing the “second boundary” in the Co-operation Zone, the Smart Port Public Service Platform of the Co-operation Zone (hereinafter referred to as the “Public Service Platform”) website was officially launched.

 

On the homepage of the Public Service Platform website, there are three modules: News & Updates, Services, and Policies & Regulations.

Among them, the “News & Updates” module provides notices, port news, service guides, and the basic introduction to the “first boundary” Hengqin Ports and the “second boundary” Passages in the Co-operation Zone. The “Services” module has two functional sub-modules: Individual Services and Corporate Services. At present, the Individual Services sub-module provides the “first boundary” services including the declaration of the list of applicable Macao residents and the registration of animal and plant products carried by Macao residents, and the declaration of transit via “second boundary” Passages. The “Corporate Services” sub-module provides the “first boundary” services including the imported Macao-manufactured food tracing with one-code customs clearance and the declaration by duty-exempted importers, and the “second boundary” services including the Declaration of transit via “second boundary” Passages and the declaration of duty-free goods. The “Policies & Regulations” module provides policy documents, regulations, normative documents and policy interpretation for the Co-operation Zone, making it easy for the public to consult and understand the policies.

 

Smart Port Public Service Platform of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

  

 

Macao-Hengqin Superimposed Advantages

  • Macao Tax for Macao Residents
    • Macao residents working in Hengqin will be exempt from paying individual income tax for the part that exceeds the amount of the tax payable in Macao.
  • Macao Supervision + Hengqin Production
    • For Macao investors’ traditional Chinese medicine products, food products and health products approved and registered in Macao, produced in the Co-operation Zone, and authorised to use “Production supervised by Macao”, “Produced by Macao” or “Designed by Macao” signs, their affiliated companies in the Co-operation Zone will be provided with a subsidy of 20% of their production costs (with an annual upper cap at RMB 40 million) by the Co-operation Zone.
  • Macao Registration, Hengqin Research & Development
    • For medicines developed in the Co-operation Zone and obtained the prior authorisation to conduct clinical trials or registration certificates from the Pharmaceutical Administration Bureau through their affiliated companies in Macao, the incentive standards will be increased by 20% based on the research and development (R&D) progress and the actual costs in R&D.
    • For independently developed medicines that are registered in both Macao and mainland China through the affiliated companies, the higher incentive standard will prevail, or the difference between these two standards will be made up.
  • Macao-Hengqin Co-operation, Cross-border Finance
    • For companies in the Co-operation Zone that have successfully issued qualified bonds in Macao, the financial support equivalent to 2% of the actual amount of funds raised will be granted.
    • For listed Macao companies’ branch in the Co-operation Zone, the financial support equivalent to 1.2 times of the corresponding listing support standard will be granted.
    • Small- and micro-sized enterprises (SMMEs) in the Co-operation Zone that have obtained loans from banking institutions in Macao may enjoy an interest discount not exceeding 50% of the sum of the loan interest, taxes, and fees related to the income of the Macao-based banking institutions in China.
  • Macao-Hengqin Linkage and Subsidy Support
    • The full-time R&D personnel employed by Macao companies that are affiliated with the integrated circuit company in the Co-operation Zone can apply for talent incentives.
    • For the integrated circuit company in Macao that receives technology funding from the Macao SAR government, its affiliated company in the Co-operation Zone may enjoy the subsidy amounting to 50% of the funding received in Macao.
    • For leading Macao companies opening business in the Co-operation Zone, a financial support equivalent to 1.2 times of the corresponding listing incentives for operations, personnel recruitment, loan interest discounts, mergers and acquisitions, office space, and Fortune 500 headquarters will be granted.
    • For Macao companies with physical office operated in the Co-operation Zone, business incentives, R&D subsidies and office rental will be subsidised.
    • For Macao companies engaged in commercial operations in the Co-operation Zone, commercial building decoration subsidies and brand landing incentives will be granted.
    • For Macao companies participating in the professional exhibitions organised or initiated by the Co-operation Zone, a 90% booth fee subsidy will be provided.

 

 

The Preferential Policies Launched in the Guangdong-Macao In-Depth Cooperation Zone in Hengqin

  1. General
    1. “Master Plan of the Development of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”
    2. The Catalogue of Encouraged Industries in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
    3. Preferential Corporate Income Tax Policies
    4. Measures to Support the Substantial Operation and Development of Leading Enterprises in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
  2. Preferential Policies for Macao
    1. Measures to Support the Development of Macao-funded Enterprises in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin
    2. Measures to Motivate Innovation and Entrepreneurship for Macao Youths
    3. Preferential Individual Income Tax Policies for Macao Residents (i.e. “Macao Tax for Macao Residents”)
  3. Talent Policies
    1. Preferential Individual Income Tax Policies
    2. Interim Measures for the Management of the List of High-end and In-demand Talents Enjoying the Preferential Individual Income Tax Policies
    3. Talent Development Support Measures
  4. Technological R&D and High-end Manufacturing
    1. Scientific and Technological Innovation Support Measures
    2. Integrated Circuit Industry Development Support Measures
    3. Support Measures for Science and Technology Exchange and Co-operation between China and Portuguese-Speaking Countries
    4. Launch of Ten Taxation Measures to Support the Development of Metaverse Industry
  5. Traditional Chinese Medicine and Other Macao-branded Industries
    Measures to Support the High-quality Development of Biomedicine in the Big Health Industry
  6. Finance
    1. Special Support Measures for Enterprises in the Co-operation Zone to Issue Bonds in Macao
    2. Support Measures for the Development of Financial Industry
    3. Special Support Measures for the Listing of Enterprises in the Co-operation Zone
    4. Support Measures for Promoting the Financing and Development of Small-, Medium- and Micro-Sized Enterprises
    5. Pilot Scheme of Foreign-capital Equity Investment Enterprises (Interim)
    6. Interim Measures for Qualified Foreign Limited Partners in Guangdong Province to Conduct Overseas Investment in Pilot Regions
  7. Culture, Tourism and MICE
    1. Support Measures for the Development of Cultural and Tourism Industrie
    2. Support Measures for the Development of the MICE Industry

Financial Information of Guangdong-Macao In-Depth Co-operation Zone in Hengqin (Electronic capital fence)

The “Master Plan of the Development of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin” proposes to innovate cross-border financial management, to build an electronic fence system, and to facilitate the high-level opening-up of the financial market of the Co-operation Zone.

In February 2023, four departments including the People’s Bank of China and the People’s Government of Guangdong Province, officially issued the “Opinions on the Financial Support for the Construction of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”, proposing to optimise and transform the Free Trade Account (FT account) system and establish an electronic capital fence in the Co-operation Zone through financial account isolation.

In April 2024, the Guangdong Provincial Branch of the People’s Bank of China issued the “Measures for the Management of Multifunctional Free Trade Accounts in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”, which were officially implemented on 6 May of the same year, clarifying the definition, business scope, fund transfer rules and supervisory requirements of multifunctional free trade accounts in the Co-operation Zone. Following the overall management principles of “relaxed control at the first boundary, and limited penetration for cross-border flow of capital under the same account name at the second boundary”, it provides guarantee for the convenient and efficient flow of a number of financial elements.

Through the above policy and multi-functional free trade account, enterprises in the Co-operation Zone will be able to engage in capital-related businesses, other than securities investment, without being restricted by foreign debt related to the difference between investment and registered investment, nationwide cross-border financing, and overseas loan limits. This policy aims to serve the cross-border trade and investment needs of the real economy.

“Opinions on the Financial Support for the Construction of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin”

Notice on Issuing the “Measures for the Management of Multifunctional Free Trade Accounts in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin” by the Guangdong Provincial Branch of the People’s Bank of China

Prior Technical Meetings of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

The “Prior Technical Meetings” mechanism, jointly launched by The Macao Trade and Investment Promotion Institute (IPIM), the Economic Development Bureau, the Financial Development Bureau, the Commercial Services Bureau, the Finance Bureau and the Livelihood Affairs Bureau of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin (the “Co-operation Zone”). Through the “Prior Technical Meetings” mechanism, people who are interested in investing in the Co-operation Zone will be provided with “one-to-one” or “one-to-many” online consultation services in Macao. For the technical or administrative procedures that may arise during the investment implementation, professional advices will be offered to speed up the investment in the Co-operation Zone. In addition, investors’ on-site inspection and business matching sessions may be arranged in order to facilitate the project implementation in the Co-operation Zone.

Macao Office of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

Address: 5 Travessa do Paiva, Macao (next to the Government Headquarters)

Tel: (853) 2889 9836

Fax: (853) 8989 5271

Email: enquiry@hengqin-cooperation.gov.mo

Website: hengqin-cooperation.gov.mo

 

Difference between setting up factories in the MSAR and in the Guangdong-Macao In-Depth Co-operation Zone in Hengqin

Macao Special Administrative Region

Guangdong-Macao In-Depth Co-operation Zone

Except for products that are banned from entering Mainland China, products that are manufactured in Macao and have fulfilled the CEPA (Closer Economic Partnership Arrangement) rules of origin, and accredited by the certificate of origin as “Made-in-Macao” can enter Mainland China with zero tariff.

Traditional Chinese medicine, food and health-care products approved and registered in Macao and manufactured in the  Co-operation Zone are allowed to use theProducts Manufactured by Macao”, “Products Supervised by Macao or Designed by Macao marks.

 

Normative Document No. 4/2023 of the Commercial Services Bureau of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin

Management Measures of the Accreditation Signs for Products Manufactured by Macao, Products Supervised by Macao and Designed by Macao (Interim)

https://www.hengqin.gov.cn/macao_zh_hans/zwgk/zcfg/gfxwj/content/post_3589519.html

https://www.hengqin.gov.cn/macao_zh_hans/zwgk/zcjd/content/post_3589588.html

Taxation

·       Profits tax is capped at 12%

Tax Relief Measures included in the

Government Budget of Financial Year 2024

·       Allowance for profits tax assessment in fiscal year 2023 was MOP 600,000.

Taxation

·       Reduce the corporate income tax to 15% for eligible industries and enterprises. This policy will cover most of the industries conducive to the moderate diversification of Macao’s economic development.

·       Regarding eligible capital expenditure, one-off pre-tax deduction, accelerated depreciation and amortisation are allowed.

·       Regarding companies founded in the In-Depth Co-operation Zone engaged in tourism, modern service, high and new technology, profit tax will not be imposed on the revenue derived from new outbound direct investment.

Contact information of the Executive Committee of the Guangdong-Macao In-Depth Co-operation Zone in Hengqin:

1. Administrative Affairs Bureau

Address: 7/F, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8938789

2. Legal Affairs Bureau

Address: 5/F, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8937816

3. Economic Development Bureau

Address: 3/F, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8938949

4. Financial Development Bureau

Address: 1-2/F, East Annex Building, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8937254

5. Commercial Services Bureau

Address: 3-4/F, Building 2, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8820280

6. Finance Bureau

Address: 4/F, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8842897

7. Statistics Bureau

Address: 3-4/F, West Annex Building of Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8841713

8. Urban Planning & Construction Bureau

Address: East Annex Building of Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-2992144

9. Livelihood Affairs Bureau

Address: 2/F, Building 1, 868 Gang’ao Avenue, Hengqin

Tel: (86) 756-8333919

Official website of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin