Strategic Trade Controls Circular No. 13/2009
Air Transhipment Cargo Exemption Scheme
for Specified Strategic Commodities
Registration for 2010

Purpose

Interested and eligible parties are invited to lodge registration applications for the Air Transhipment Cargo Exemption Scheme for Specified Strategic Commodities by 13 November 2009 to enjoy exemptions from licensing requirements for air transhipment cargo of specified strategic commodities in 2010.

Background

2. The Air Cargo Transhipment (Facilitation) Ordinance which aims to facilitate Hong Kong to be further developed into an international and regional air cargo hub came into operation on 26 May 2000.
   
   
3. Hong Kong is determined to maintain the integrity and effectiveness of its Strategic Trade Controls System to deter illegal diversion of strategic commodities and, at the same time, to facilitate legitimate trade flows through Hong Kong.  Having regard to this policy commitment, Trade and Industry Department implemented an Air Transhipment Cargo Exemption Scheme for Specified Strategic Commodities (referred below as "the Scheme") in the latter half of 2000 to facilitate air transhipment of specified strategic commodities through Hong Kong.  Interested parties have been invited to register under the Scheme since 2000.

The Air Transhipment Cargo Exemption Scheme
for Specified Strategic Commodities ( "The Scheme" )

4. Registrants under the Scheme are, subject to certain conditions, exempted from licensing requirements under the Import and Export Ordinance, Cap. 60 and the Import and Export (Strategic Commodities) Regulations, Cap. 60, sub leg. G, in respect of air transhipment cargo of specified Strategic Commodities.  The scope of the Scheme, including the definition of air transhipment cargo, and the types of Strategic Commodities covered by the Scheme are set out in Appendix I.  The conditions of exemptions are listed in Appendix II.

Registration

5. Carriers and parties involved in handling air transhipment cargoes in the Hong Kong International Airport, including the airlines, ground handling agents and freight forwarders, who wish to obtain exemptions from licensing requirements for air transhipment cargo of specified strategic commodities in 2010 are now invited to register under the Scheme.  The Certificates of Exemption  for the existing registrants of the Scheme are valid up to 31 December 2009 only.  To continue to enjoy the exemptions in 2010, it is necessary for the registrants to renew their registration and obtain a new Certificate of Exemption.  The application form is at Appendix III (fillable pdf format).  Existing registrants and new applicants are required to lodge the completed application form and supporting documents to the Licensing Section of the Strategic Trade Controls Branch of the Trade and Industry Department at Room 516B, 5/F, Trade and Industry Department Tower, 700 Nathan Road, Kowloon, on or before 13 November 2009.  Successful applicants will be issued with a Certificate of Exemption which will be valid up to 31 December 2010.
   
   
6. Applicants are requested to ensure that their applications are supported by documents indicated in the relevant sections of the Application Form at Appendix III (pdf format).  Officers of Customs and Excise Department may conduct further verification to ascertain the authenticity and comprehensiveness of the information provided in the applications.  In this connection, applicants which have been appointed by other airlines as agents for the purpose of handling air transhipment cargo are reminded to provide copies of agency agreements or letters of appointments issued by the airlines where available.  They should also be prepared to prove their principal and agent or other contractual relationships with the relevant airlines regarding the handling of air transhipment cargo upon requests by the officers of the Customs and Excise Department.

Important Note

7. It is an offence for any person granted an exemption under the Scheme to breach any conditions of exemption.  Airlines, ground handling agents and freight forwarders should therefore read carefully the conditions of exemption and ensure that they comply with those conditions.  Any person who provides false information, contravenes or fails to comply with any such conditions is liable to prosecution and/or may have his exemption under the Scheme revoked or suspended.  Besides, persons found to have contravened any conditions of exemption may not have their registration renewed next year.
   
   
8. Airlines, ground handling agents and freight forwarders should also note that the current Scheme for specified strategic commodities is separate from the other Transhipment Cargo Exemption Scheme which the Department has been implementing for years covering pharmaceutical products, reserved commodities and rough diamonds.  Airlines, ground handling agents and freight forwarders who are currently registered under that Transhipment Cargo Exemption Scheme must separately apply for registration under the present Scheme in order to enjoy the exemption in respect of air transhipment cargo of specified strategic commodities.
   
   
9. The Air Transhipment Cargo Exemption Scheme for Specified Strategic Commodities is implemented only for the purpose of providing applicable exemption for specified strategic commodities, the licensing control of wich is administered by the Trade and Industry Department in  accordance with Section 6A(2) of the Import and Export Ordinance and regulation 2(1) of the Import and Export (Strategic Commodities) Regulations.  Controls imposed by other legislations are not affected by the exemption provided by this Scheme.  Registrants should note and observe the controls maintained by other Government departments under relevant legislations.  

Warning

10. The Trade and Industry Department works closely with the Customs and Excise Department to ensure the integrity of the Scheme.  Documentation checks and physical checks on consignments and visits to the registered premises of registrants will be carried out by officers of the two Departments to ensure that the provisions of the Scheme are complied with.
    
    
11. Trade and Industry Department takes a serious view on registrants breaching any of the conditions of exemption under the Scheme.  A registered person who contravenes or fails to comply with any of the conditions of exemption commits an offence and is liable to a fine of $500,000 and imprisonment for 2 years.  Furthermore, the Director-General of Trade and Industry may take administrative actions against him independent and irrespective of any prosecution actions which may be instituted against him.  Such administrative actions may involve but shall not necessarily be confined to the revocation and suspension of any exemption and/or registration granted and the refusal to renew any exemption and/or registration granted.

Enquiries

12. If you require any further information on the subject, please contact one of the following officers or send emails to us at stc@tid.gov.hk:

Name of Officer	Telephone No.
Mr Jonathan HUI	2398 5592
Mr K. N. LEUNG	2398 5577

Yours faithfully,

 (Toby Mak)

 for Director-General of Trade and Industry