- Section 49 of the Inland Revenue Ordinance provides that if the Governor in Council declares in an order that arrangements specified in that order for relief from double taxation have been made with the Government of any country and that it is expedient that those arrangements be given effect, the arrangements shall have effect notwithstanding anything in the Ordinance.
- The effect of this order is to declare, for the purposes of section 49, arrangements made between the Governments of Hong Kong and the United States of America respectively by way of an Exchange of Notes, for the reciprocal exemption of tax in respect of income derived from the international operation of ships by the residents of the United States of America and Hong Kong respectively.
- The Notes are set out in the Schedule. The Government of the United States of America agrees to exempt from tax gross income derived from the international operation of ships by individuals who are residents of Hong Kong and corporations which satisfy the criteria specified in the Notes. The Government of Hong Kong agrees to exempt from tax gross income derived by the international operation of ships by United States citizens and corporations which satisfy the criteria specified in the Notes.