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(L) It is intended that the HKSAR Government shall formulate appropriate policies to promote and co-ordinate the development of various trades such as commerce, tourism, real estate, transport, public utilities, services, agriculture and fishery;
(M) It is intended that no exchange control policies shall be applied in the HKSAR Government and that markets for foreign exchange, gold, securities and futures shall continue.
Principles of the Basic Legal Structure regarding Sections 1 to 4 of Chapter V
Public Finance and Taxation
(A) The HKSAR Government shall regulate and have exclusive control over its finances. All revenues and other moneys raised by the HKSAR Government shall be used solely and exclusively for the purposes of the HKSAR and not for the purposes of the Central People's Government or any other part thereof. The HKSAR Government may borrow money, and issue debt obligations and guarantees;
(B) The HKSAR Government shall have sole control and responsibility over its own system of taxation. The Central People's Government shall not levy taxes on the HKSAR, or on income arising in the HKSAR, or on residents of the HKSAR except with respect to income of residents arising in the People's Republic of China outside the HKSAR;
(C) The HKSAR Government shall not enforce the collection of taxes imposed by the Government of the People's Republic of China or any other part thereof;
(D) The HKSAR Government may enter into agreements with the Central People's Government for the avoidance of double taxation;
(E) The HKSAR Government shall have power to make laws relating to the imposition of taxes, tax rates and tax exemptions. Taxation can be imposed only when prescribed by law;
(F) The HKSAR Government shall have the power to make laws determining the extension to the HKSAR of agreements and treaties between the People's Republic of China and foreign sovereigns (where such arrangements and treaties so permit);
(G) The HKSAR may, using the name 'Hong Kong, China' participate in relevant fiscal arrangements for the avoidance of double taxation or other similar arrangements;
(H) The HKSAR Government shall have sole responsibility and control over its monetary, financial and banking systems, which shall be governed by law. The HKSAR shall regulate and supervise these systems in accordance with law;
(I) The Hong Kong dollar shall circulate as the legal tender of the HKSAR;
(J) The authority to issue Hong Kong dollars shall be vested exclusively in the HKSAR alone. The system regarding the issue of Hong Kong dollars shall be prescribed by law;
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(K) The HKSAR Government may, by statute, authorize designated banks to issue or to continue to issue Hong Kong dollars;
(L) The Exchange Fund of the HKSAR shall be managed and controlled exclusively by the HKSAR Government;
(M) The HKSAR Government shall not restrict the free movement of goods, intangible assets and capital except as prescribed by law;
(N) No person shall be deprived compulsorily of his property except in accordance with law for a public purpose and upon payment of compensation equal in amount to the full market value of the property at the time of deprivation.
(O) The HKSAR shall be a separate customs territory which shall be independent from the Central People's Government;
(P) The HKSAR Government shall not impose any tariff unless otherwise prescribed by law;
(Q) The HKSAR may, using the name 'Hong Kong, China', participate in relevant international organizations and international trade agreements (including, but without prejudice to the generality of the foregoing, preferential trade arrangements, such as the General Agreement on Tariffs and Trade and arrangements regarding international trade in taxation);
(R) Export quotas, tariff preferences and other similar arrangements, which are obtained by the HKSAR or which were obtained and remain valid, shall be enjoyed solely and exclusively by the HKSAR;
(S) The HKSAR Government may issue its own certification of origin for products manufactured in the HKSAR in accordance with prevailing rules of origin.
Note: The definition of ‘Exchange Fund', 'External Trade' and 'economic relations' should be contained in a definitive section at the beginning of the Basic Law.
(Mr. Hilton CHEONG-LEEN left the meeting at 3.50 p.m. and Mr. LEE Chik-yuet arrived at 4.05 p.m.)
(The Vice-Chairman declared a recess at 4.10 p.m. and the meeting resumed at 4.15 p.m.)
(Messrs. Joseph Y. S. CHAN, FAN Kam-ping and CHAN Kwok-ming, Miss Cecilia YEUNG, Mrs. Nellie FONG and Miss Fox Pui-yee left the meeting after the recess.)
MR. FREDERICK K. K. FUNG (in Cantonese):-Madam Chairman, I support your motion. In 1984, an agreement on the future of Hong Kong—the Sino-British Joint Declaration, was announced by both China and Britain. To the people of Hong Kong, the contents of the Declaration may be summarized into several main points:
Firstly, China will recover Hong Kong and resume the sovereignty over Hong Kong. Secondly, the policy of 'one country, two systems', which is a democratic policy, will be implemented in Hong Kong by China in the future. It was clearly stated in the Declaration that the Government of the Hong Kong Special
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