The Chief Executive in Council has approved a 10-year extension to the Peak Tramways Company's franchise to run the scenic tram route. The extension will apply once its current operating period ends on New Year's Eve.

The company must pay a non-refundable lump sum full market premium of $36.8 million to the Government before commencement of the extension for the rental of the land occupied to run the service.

The Government said the company has provided stable and satisfactory safety and service standards, and an important means for tourists to travel to the Peak. It has also indicated plans to enhance its operation and passenger facilities.

The extension will preserve one of Hong Kong's premier tourist attractions.