The Government has made legislative amendments to implement the post-2004 textiles control system and to specify the revised origin description for piece-knitted garments after the elimination of quantitative restrictions on textiles and clothing products by January 1, 2005.

By January 1, all quantitative restrictions will be completely eliminated in accordance with the World Trade Organisation Agreement on Textiles & Clothing (T&C). Exports of Hong Kong textiles and clothing products will then enjoy quota-free access to all markets. 

Under the post-2004 system, all quota-related operations will cease and Restrained Textiles Export Licences to the US, the EU and Canada will end. The Production Notification  requirement will be applicable to cut-and-sewn garments destined for countries that have applied safeguard actions on Mainland textile and clothing products. Licences for non-commercial shipments will no longer be required.

Commercial shipments still require licences

Licensing requirements for commercial shipments of textiles imports and exports will be maintained to ensure that Hong Kong products will not be adversely affected by the application of Mainland-specific safeguard measures.

Different licensing requirements will apply for "sensitive" and "non-sensitive" markets. "Sensitive" markets cover the Mainland and those economies that have invoked safeguard measures on Mainland textile and clothing products. Those other than "sensitive" markets are "non-sensitive" markets. These textiles licensing arrangements will be reviewed in late 2005.

The new textiles control system will be simple, effective and enforceable, the Commerce, Industry & Technology Bureau said.  It will not impose any more control than necessary in a quota-free environment. The key is to ensure origin compliance of textile and clothing products claiming Hong Kong origin.

Quota-related applications fees no longer applicable

With the elimination of quotas, quota-related textiles applications fees and service fees will no longer be applicable after 2004. Pending a review on the overall textiles licensing arrangements in late 2005, other textiles-related fees will remain unchanged.

The Special Licensing Scheme for Piece-knitted Garments, which is for the implementation of the quota control system of the HK/US textiles trade, will be discontinued after 2004.

Having regard to the trade's overall interest, Hong Kong's origin rule for piece-knitted garments will be revised to allow either "knitting of knit-to-shape panels" or "assembling of knit-to-shape panels into garments" as the origin conferring process.

The Commissioner of Customs & Excise has made an order under the Trade Descriptions Ordinance to revise the origin marking rule for piece-knitted garments to this effect.