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HKSARG's Response to European Commission's Communication on Hong Kong and Macao

In response to the European Commission (EC)'s Communication on Hong Kong and Macao entitled "The European Union, Hong Kong and Macao: possibilities for co-operation 2007-2013", a government spokesman today (October 31) welcomed the EC acknowledgement that the "One Country, Two Systems" principle had been respected and was working well for the people of Hong Kong.

The spokesman also welcomed the EC proposal to enhance co-operation and development of closer relations between the European Union (EU) and the Hong Kong Special Administrative Region (HKSAR) in trade, economic and other areas within Hong Kong's high degree of autonomy under the Basic Law. "For this purpose, we will continue to work out arrangements with the EC for conducting the proposed regular dialogue between the HKSAR Government and the EC. The agenda for the dialogue will cover items to be mutually agreed," the spokesman said.

"The EU is one of our major trading partners. The HKSAR and the EU have been enjoying good economic and trade relationship. We will continue to enhance understanding and co-operation with the EC on economic and trade issues of mutual interest, having regard to each other's course of development.

"For instance, we will continue to strengthen customs co-operation on intellectual property rights. This includes measures to combat copyright infringement and counterfeit activities," he added.

On co-operation on tax matters, the spokesman said: "The HKSAR is committed to pursuing effective exchange of information within the ambit of bilateral comprehensive double taxation agreements and in accordance with our legislation. We also have stringent anti-tax avoidance legislation. We are vigilant in combating tax avoidance and evasion, and we support international co-operation on this front by improving transparency and the exchange of information in accordance with our legislation."

On constitutional development, the spokesman said: "The Central Authorities and the HKSAR Government are fully committed to achieving the ultimate aim of universal suffrage in accordance with the Basic Law. In November last year, the Chief Executive initiated the discussion on formulating a roadmap for universal suffrage through the Commission on Strategic Development. The discussion is progressing well.

"In May, the commission concluded discussions on the principles and concepts relating to universal suffrage. The commission is now focusing on the discussion of possible models for implementing universal suffrage for the Chief Executive and the Legislative Council. The HKSAR Government will publish a report to draw conclusions on the discussion of the commission during the first half of 2007, and will submit the report to the Central Authorities. We hope that the report will provide a basis for the Government to continue to take forward our constitutional development during the next term.

"Constitutional development is part of our internal affairs. The HKSAR will deal with it in accordance with the Basic Law. We hope and believe that the EC will continue to respect this principle," the spokesman added.

The communication from the EC to the Council and the European Parliament was issued on October 31.

Ends/Tuesday, October 31, 2006