According to the legal framework for the textiles export control system, all textile exports and re-exports from Hong Kong must be covered by valid export licenses issued by the Director-General of Trade.
There are four types of textiles export licenses which are commonly used:
There are four types of textiles export licenses which are commonly used:
1. Export License (Textiles) Form 4 (TIG 353): commonly known as "white" license used for the export of
i. re-export goods
ii. samples
iii. textile products not subject to quota restraint
iv. unaccompanied personal effects
v. bona fide gifts
vi. piece knitted garments assembled in Hong Kong from knit to shape panels of foreign origin (for the USA market)
2. Export license (Textiles) Form 5 (TIG 353A): commonly known as "blue" or "quota" license used to cover export of textiles subject to specific quota restraint, other than export to the USA under quota of piece-knitted garments made from knit-to-shape panels knitted in Hong Kong
3. Export License (Textiles) Form 8 (TRA 534): "quota" license to cover export to the USA of piece-knitted garments made from knit-to-shape panels knitted in Hong Kong
4. Special Export Licenses 8a (TRA 534A) and 8d (TRA 534D): for the export of knit-to-shape panels for the purpose of outward processing .
Normally an export license is valid for 28 days from the date of issue or until the end of the restraint period, whichever is earlier. For EU, export licenses valid for 3 months may be issued on special request. Export licenses are not transferable. Depending on the agreement with the importing country, applications for export licenses are to be made in triplicate or quadruplicate, the original being kept by the Trade Department, and the remaining copies, to the exporter, the importer and the carrier as appropriate. (In case of exports to the EU, the Trade Department retains the duplicate with the remaining copies to the other parties) Re-export
For re-export of textiles products of non-Hong Kong origin to overseas markets, applications should be made on Form 4 (TIG 353) in quadruplicate for all European markets, and in triplicate for all other markets. All applications, except those concerning re-exports of personal shipments and samples satisfying certain quantitative limits and licensing criteria, should be supported by photocopies of relevant import licenses (Textiles).
Country of Origin
A Certificate of Hong Kong Origin (CO), is to certify that the goods concerned are of Hong Kong origin. A CO is normally applied to facilitate customs clearance of consignments in the importing countries. Export license applications for restrained textiles exported to the United States (with some exclusions), the EU, and Norway must be supported by COs. A CO is issued only when it has been established that the goods are the natural produce of Hong Kong or the product of a manufacturing process in Hong Kong which has changed permanently and substantially the shape, nature, form or utility of the basic materials used in manufacture. There are specific origin criteria applicable to individual types of products manufactured in Hong Kong, and specific conditions to the CO rules covering exports of certain products to certain markets. In Hong Kong, quota is allocated according to the principle of past performance, i.e., it is allocated to those traders who have demonstrated capabilities of exporting particular products to the markets concerned. However if they are unable to maintain their export performance, the quota allocated to them will be lost. Quota allocated is valid for a period of one year according to the following rules:
1. A quota holder who used less than 95% of its quota holding in a particular category in the preceding restraint period will be offered an allocation equal to the amount it used;
2. A quota holder who used 95% or more of its quota holding in a particular category in the preceding restraint period will be offered an allocation equal to 100%;
3. A quota holder who falls under (2) and who did not transfer out on a temporary or permanent basis any of its quota holding in a particular category in the preceding restraint period will be offered an additional amount equivalent to the growth factor for that category.
The Trade Department allocates quota to individual holders but also runs a system whereby quota holders are allowed to transfer quotas. This transfer system facilitates optimum utilization of quotas by Hong Kong; those holders who no longer wish to use quota in a particular category can transfer them to other traders who need them, thereby creating a channel for quota for new comers.
There are two types of transfer, permanent and temporary.
[Transferor is the party who transfers, transferee is the party to whom the quota is transferred.]
Briefly:
1. Permanent transfers (type B) - quota may be transferred permanently from one party to another; the transferee becomes the quota holder and obtains the use of quota, and will be allocated quota units in the category transferred based on its actual performance.
2. Temporary transfers - the transferee obtains the use of quota for the year in question; the performance against the transferred quantity is attributed to the transferor. There are two kinds of temporary transfers:
