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12.
For goods processed by foreign-invested enterprises, some may be sold in China and some may even be exported directly from China without passing through Hong Kong. But in practice, most of the firms engaged in OP as foreign-invested enterprises seldom make use of the privilege to sell goods in China. The finished goods are mostly re-imported back to Hong Kong for subsequent re-exportation abroad, or transshipped abroad through
Hong Kong.
13.
Extent of OP
Regarding the
the extent of OP,
OP, nearly half of the manufacturing establishments heavily engaged in OP have their products entirely manufactured in China and have no production lines in Hong Kong. Their Hong Kong offices are mainly engaged in
in marketing, design, sample-making, research and development and management control.
14.
For those manufacturing establishments which have production lines both in China and in Hong Kong, the products designated for production in China are those involving labour- intensive manufacturing processes. Most of the products scheduled to be processed in China have the entire manufacturing process done there, while quality control and packaging are sometimes performed in Hong Kong. According to some of these establishments, maintaining production lines in Hong Kong is for manufacturing high end products or meeting orders of small quantity and requiring urgent delivery. Besides, it also provides the flexibility of producing Hong Kong origin products to meet the tariff preference scheme of various countries.
For example, some "Hong Kong made" products can be sold to non-
GSP markets while "China made" products can be sold to GSP markets, to gain tariff preference.
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