HK 'severely reprimands' US for suspending extradition, tax pacts

Hong Kong "severely reprimanded" the US administration today for its unilateral decision to suspend or terminate three bilateral agreements.
The US Department of State announced Wednesday the suspension or termination of three bilateral agreements signed between Hong Kong and Washington.

They are the Agreement on the Surrender of Fugitive Offenders (SFO), the Transfer of Sentenced Persons (TSP) Agreement and the Agreement concerning Tax Exemptions from the Income Derived from the International Operation of Ship.

"Contrary to what was alleged in the US President's Executive Order, these agreements are not US' preferential treatment for Hong Kong," a government spokesman said.

The spokesman said these bilateral agreements are negotiated in good faith to benefit the peoples and businesses of both sides in areas of law and order, shipping and tax treatment.

"The US' unilateral decision reflects its disrespect for bilateralism and multilateralism under the current administration and should be condemned by the international community," the spokesman added.

"The HKSAR Government strongly objects to and deplores the US' action, which is widely seen as a move to create troubles in China-US relationship, using Hong Kong as a pawn."

The spokesman said since the entry into force of the SFO Agreement between the SAR and the US in 1998, the number of fugitive offenders successfully surrendered to the US amounted to a total of 69, as compared with 23 surrendered from the US. 

“Therefore, it is expected that suspension of the SFO agreement will have a greater impact on the US' enforcement operation,” the spokesman said.

“Suspension of the SFO Agreement will only allow such criminals to evade legal sanctions and thus failing to uphold justice for the victims. As such, the US will need to be answerable to the rule of law, to the American people and to the international community at large," the spokesman said. 

The spokesman also said the TSP Agreement allows sentenced persons to return to their places of origin to serve their sentence, where there are no language or cultural barriers and where friends and relatives can pay more regular visits, and is conducive to their rehabilitation. 

The US' decision to terminate the Hong Kong-US TSP Agreement eliminates the possibility of such transfers and defies values of humanitarianism.

On the Agreement concerning Tax Exemptions from the Income Derived from the International Operation of Ship, it provides for mutual tax exemption on income derived by residents or companies of the other side from international shipping operation business. 

"Should the agreement between Hong Kong and the US be terminated, for the US companies, they would need to pay taxes to both the US and Hong Kong governments, whereas Hong Kong companies will be required to pay tax to the US government only, as their shipping income are exempted from tax liability in Hong Kong,” the spokesman said.

"The termination of the agreement increases the operating costs of the shipping companies concerned, in particular the US companies as they will be subject to double taxation. It would hamper the development of the shipping sector between Hong Kong and US, and is to nobody's interest," he added.

"We urge the US administration to immediately stop interfering in Hong Kong's internal affairs, and retract its baseless allegations against the national security law."