On February 16, 2023, the Dongguan Municipal People’s Government and the Airport Authority Hong Kong (AAHK) signed a Co-operation Framework Agreement (CFA) to implement and foster the long-term development of the “Dongguan-Hong Kong International Airport Logistics Park and Sea-air Intermodal Cargo Transshipment” initiative between Mainland China and Hong Kong. This marks a key milestone in the AAHK-led Hong Kong International Airport Logistics Park (HKIALP) project (the “Project”). Fangda acted as the legal counsel to AAHK and provided one-stop legal services advising on PRC and Hong Kong laws.

Under the Project, AAHK will set up the HKIALP in Dongguan and a new airside intermodal cargo pier within Hong Kong International Airport’s three-runway system. The first phase of the Project is contemplated to commence operation in 2025. This first-of-its-kind Project allows export cargo from the Chinese mainland to undergo security screening, palletization and cargo acceptance procedures in advance at an upstream Dongguan logistics park and then be directly transported by sea to a dedicated airside cargo pier at Hong Kong International Airport for direct transshipment to overseas destinations, without repeating the relevant screening procedures. Conversely, cargo from overseas may also be imported into the Chinese mainland via Hong Kong through a similar, reverse process.

The Secretary for Transport and Logistics, Mr. Lam Sai-hung said, “Hong Kong is an international aviation hub with a wide international aviation network, while Dongguan is a premier manufacturing base in the Greater Bay Area (GBA). Based on the existing mutually beneficial co-operation, the CFA effectively combines the competitive edges of Hong Kong and Dongguan and creates synergy. It is yet another example of Hong Kong using its strengths to contribute to the needs of the country and integrate into the mutually beneficial development of the GBA.”

Fangda has served as the legal counsel to this Project since 2021 and successively assisted AAHK in achieving essential milestones, including the establishment of the project company, the implementation of the Pilot Scheme for testing, establishment and improvement of the operation of the Project, and the conclusion of agreements with Cathay Pacific Airways Services Co., Ltd. and other air cargo services operators. Fangda also provided professional and effective legal solutions for specific issues related to the investment structure, transaction documentation, industry regulation, compliance, and employment matters. This is the second time that Fangda has advised AAHK on a major GBA cooperation project, after having previously advised AAHK on its signing of the Co-operation Memorandum of Understanding (MoU) with the Zhuhai Municipal People’s Government in November 2022.

The Fangda team was led by partner Joe Zhou and the main team members included Helen Huang, Neal Yang and Joe Scheu. Support was also provided by Real Estate & Construction partner Stephen Lin and counsel Amber Wang, Labor & Employment partner Lisa Zhao and Data Compliance/Cyber Security partner Gil Zhang.