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Trade and Industry Department The Government of the Hong Kong Special Administrative Region
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Transhipment Cargo Exemption Scheme (TCES) Note

Shipping companies, airlines and freight forwarders registered under the Transhipment Cargo Exemption Scheme (the Scheme) are, subject to certain conditions, exempted from import and export licensing requirements in respect of transhipment cargoes they handle.

Definition of Transhipment Cargo

"Transhipment cargo" means any imported article that -

  1. is consigned on a through bill of lading or a through air waybill from a place outside Hong Kong to another place outside Hong Kong; and
  2. is or is to be removed from the vessel, aircraft or vehicle in which it was imported and either returned to the same vessel, aircraft or vehicle or transferred to another vessel, aircraft or vehicle before being exported, whether it is or is to be transferred directly between such vessels, aircraft or vehicles or whether it is to be landed in Hong Kong and stored after its importation, pending exportation.

Product Coverage

Exemption granted to specified person registered under the Scheme applies to the following types of transhipment cargo1:

  1. Pharmaceutical products and medicines as specified in Part 1 of Schedule 1 and Part 1 of Schedule 2 to the Import and Export (General) Regulations (Cap 60A) except dangerous drugs as defined by Section 2 of the Dangerous Drugs Ordinance, (Cap. 134)2;
  2. Rice as specified in the Schedule to the Reserved Commodities (Control of Imports, Exports and Reserve Stocks) Regulations, (Cap. 296A);
  3. Frozen or chilled meat and poultry as specified in Part 1 of Schedule 1 to the Import and Export (General) Regulations, (Cap 60A);
  4. Chinese herbal medicines and proprietary Chinese medicines as specified in Part 1 of Schedule 1 and Part I of Schedule 2 to the Import and Export (General) Regulations, Cap. 60A;
  5. Powdered formula as specified in Part 1 of Schedule 2 to the Import and Export (General) Regulations (Cap. 60A); and
  6. Rough diamonds as specified in Part 1 of Schedule 1 and Part 1 of the Schedule 2 to the Import and Export (General) Regulations, Cap. 60A.

If importation of the products under (a) to (f) above from their country or place of origin or exportation to their country or place of destination or transhipment route is subject to any trade sanctions, including trade sanctions under the United Nations Sanctions Ordinance (Cap. 537), the relevant transhipment cargoes are not eligible for any licensing exemption under the Scheme.

For rough diamonds under (f) above, the exemption only applies to transhipment of rough diamonds from or to a country or place for which the Kimberley Process Certification Scheme is effective or as permitted by the Kimberley Process (KP3 and the importation of the rough diamonds from the exporting country or place and exportation of which to the country or place of destination are not subject to any trade sanctions.

Notes:

  1. For air transhipment cargoes of the products under (a) – (f) above, regulation 6AA and regulation 6DF of the Import and Export (General) Regulations (Cap. 60A) have already provided that import and export licences are not necessary.  Air transhipment cargo means cargo that is both imported and consigned for export in an aircraft and which, during the period between its import and export, remains within the cargo transhipment area of Hong Kong International Airport.  For rough diamonds, the air transhipment cargoes are also needed to be sealed in a container and has not been tampered with and the seals on the container remain intact. 
  2. If pharmaceutical products and medicines in (a) above contain certain pharmaceutical substances that are listed under Schedule 1 or 2 to the Control of Chemicals Ordinance (Cap. 145), such as ephedrine,  ergotamine, ergometrine, pseudoephedrine, norephedrine (phenylpropanolamine) and their salts, a permit issued by the Customs and Excise Department is still required to remove the pharmaceutical substances and their salts in transhipment in Hong Kong.
  3. The Kimberley Process (KP) is a negotiating forum originated from discussions in the United Nations General Assembly (UNGA) regarding rebel activities in some parts of Africa.  It seeks to stop trade in conflict diamonds (rough diamonds used by rebel movements or their allies to finance conflicts aimed at undermining legitimate governments, as described in relevant United Nations Security Council resolutions, and as understood and recognised in the relevant UNGA Resolutions) from fuelling armed conflicts, activities of rebel movements and illicit proliferation of armament. The KP Certification Scheme (KPCS) for rough diamonds was launched by the KP on 1 January 2003.  Under the KPCS, Participants can only trade rough diamonds with countries or places as permitted by the KP. Traders may refer to Schedule 7 to the Import and Export (General) Regulations, Cap. 60A, for the list of such countries or places.

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Note:
The Transhipment Cargo Exemption Scheme is set up with legal basis provided by paragraph 2 of regulation 6 of the Import and Export (General) Regulations (Cap. 60A) and paragraph 1 of regulation 11A of the Reserved Commodities (Control of Imports, Exports and Reserve Stocks) Regulations, (Cap. 296A).