28 June 2017
Testing and Certification Industry in Hong Kong
- Hong Kong's testing and certification industry has grown substantially since the 1980s. The industry comprised of 745 establishments, most of which were private laboratories in 2015, employing a total of 17,590 people.
- The industry provides testing and inspection services for consumer products manufactured in the Pearl River Delta for overseas buyers, and certification services for such products as well as for the relevant quality management systems. There is also an increasing demand for food testing conducted by private laboratories.
- The industry has been identified as one of the industries which Hong Kong has clear advantage. The Hong Kong Council for Testing and Certification has been established to enhance the professional standards and recognition of Hong Kong’s testing and certification services in the international arena.
- Given a robust accreditation system and a good international reputation, Hong Kong is well positioned to act as an independent third party to provide quality certification and product testing services for mainland enterprises to boost the confidence of overseas and local buyers.
Range of Services
The industry provides a high volume of testing and inspection services for consumer products manufactured in the Pearl River Delta, such as toys and children’s products, electrical and electronic goods, and textiles and garments upon the requests of overseas buyers. In addition, the industry provides certification services for such products as well as for the relevant quality management systems (e.g. ISO9000). Some laboratories also conduct testing on food, Chinese medicine and construction materials for importers and suppliers. In fact, food importers and suppliers have increasingly engaged private laboratories to conduct food testing before putting the food on the market shelves. Other testing services include chemical testing, environmental testing, medical testing, proficiency testing, and physical and mechanical testing.
Many laboratories and certification bodies in Hong Kong are accredited. The Hong Kong Accreditation Service (HKAS) under the Innovation and Technology Commission (ITC) provides accreditation service for laboratories, certification bodies and inspection bodies through the Hong Kong Laboratory Accreditation Scheme (HOKLAS), Hong Kong Certification Body Accreditation Scheme (HKCAS) and Hong Kong Inspection Body Accreditation Scheme (HKIAS). As of May 2017, there were 222 accredited laboratories/proficiency testing providers/reference material producers, 24 accredited certification bodies and 20 accredited inspection bodies in Hong Kong.
Private laboratories now seek accreditation on a voluntary basis, but they are strongly encouraged to do so, as testing, certification and inspection services accredited by the local accreditation bodies are widely recognised in overseas markets.
Industry Development and Market Outlook
Hong Kong as a Testing and Certification Centre
Hong Kong, as an international trade centre situated strategically at the door of the huge and rapidly growing mainland market, has potential to develop into a major product testing and certification centre in the region. By acting as an independent third party in providing services to mainland enterprises, it could help safeguard consumer interests, build up the Hong Kong brand, enhance the competitiveness of local and mainland products in the world market, and create high-end employment opportunities for professionals and skilled-workers.
Establishing Hong Kong as a testing and certification centre is in line with the objective of upgrading the Pearl River Delta into “a world-class base for advanced manufacturing industries”, as set out in the National Development and Reform Commission’s Outline of the Plan for the Reform and Development of the Pearl River Delta (2008-2020). However, the local industry will have to compete with international brands, such as ITS, SGS and TUV, which have already set up operations in many parts of the mainland to provide service at a cost lower than the Hong Kong service providers.
Support and Facilitation from the Government
In 2008, the Task Force on Economic Challenges identified the testing and certification industry as one of the industries which Hong Kong have clear advantage, considering that this industry could benefit the economy in the medium and long term. The government has then established the Hong Kong Council for Testing and Certification (HKCTC) to drive the development of the industry, to raise its professional standards and to enhance the recognition of the industry in the international arena by building up a brand name for Hong Kong's testing and certification services.
Both the Hong Kong Productivity Council (HKPC) and the Hong Kong Science and Technology Parks Corporation (Science Park) have laboratory facilities available for use by private testing laboratories. Examples include HKPC's special chamber for testing of electromagnetic compatibility and Science Park's equipment for testing LED lightings. By making use of these facilities, testing laboratories will not need to make a huge investment on equipment if their business volume for particular tests is not high.
On the other hand, the government has implemented the ‘Nil Waiver Fee’ measure since February 2016 to facilitate the operation of testing and calibration laboratories in industrial building. Owners of industrial premises can apply to the Lands Department for a waiver of lease conditions in order to accommodate testing and calibration laboratories and successful applicants are not required to pay the concerned waiver fee.
Market Opportunities and Recent Developments
In addition to traditional sectors like textiles, clothing and footwear, toys and games, electrical products as well as medicines, HKCTC has identified good market opportunities for Chinese medicines, construction materials, food, jewellery, environmental protection, and information and communication technologies (ICT).
Given its proximity to the mainland and long history as a major trading hub in the region, Hong Kong has a clear advantage in the trading of Chinese medicine. If more can be done on the front of testing and certification services for Chinese medicine, it will certainly help build up greater confidence in the use of Chinese medicine in the overseas markets. In fact, Hong Kong has built up its local capacity and capability in the testing of Chinese medicine through the introduction of testing requirement for registration of proprietary Chinese medicine testing and the development of Hong Kong Chinese Materia Medica (CMM) Standards. Some of the local universities also possess considerable expertise in the field of Chinese medicine and can provide technical support in the development of new testing services. In November 2014, HKPC developed a product certification scheme for CMM and two certificates were awarded to two batches of CMM in 2015.
With a view to upgrading the quality of its buildings and setting an example for the local construction industry, the Hong Kong Housing Authority (HKHA) plays a leading role in taking forward the development of product conformity certification schemes (PCCS). As at March 2017, HKHA has required product certification for 11 types of construction materials or building components. Wider adoption of product certification for construction materials in public works as well as in the private sector is greatly encouraged. As far as export market is concerned, Hong Kong’s testing and certification industry can perform a stronger supporting role for the large volume of construction materials produced and exported by the Chinese mainland.
Amid the growing public awareness and concern over the safety (e.g. on heavy metals, preservatives and melamine) and the nutritional content (e.g. protein, fat and sodium) of food, there is strong demand for testing and certification services for local food importers and suppliers. In fact, the Hong Kong Polytechnic University has recently completed the development of a new food hygiene standard certification system aiming at enhancing food safety culture in local catering industry. Besides, laboratories also have the potential to provide food testing services for traders in the mainland, where much emphasis is now placed on food safety.
Hong Kong’s jewellery trade is renowned in the world market. There is potential synergy for the jewellery trade to make use of the high credibility of Hong Kong’s testing and certification industry to enhance consumer’s confidence and the competitiveness of Hong Kong’s jewellery trade. In fact, some sectors in the jewellery trade are exploring new testing and certification services to support the growth of trade. Recently, the Gemmological Association of Hong Kong has completed the development of standard testing methods for jade. The standard was published in March 2017.
As the general public is putting increasing emphasis on environmental protection, there will be more tests related to the "green" elements of consumer products manufactured on the mainland as well as those for environmental samples in Hong Kong. On the other hand, given the wider adaptation of ICT nowadays, there will be opportunities for further development of testing and certification services in this trade, such as third-party software testing and a software product certification scheme.
Closer Economic Partnership Arrangement between Hong Kong and the Mainland (CEPA)
Under the Supplement VII and VIII to CEPA, testing organisations in Hong Kong are allowed to co-operate with designated mainland certification bodies to undertake product testing for the China Compulsory Certification (CCC) System for all existing products processed in Hong Kong that require CCC. These testing organisations have to be accredited by Hong Kong Accreditation Service to be capable of performing testing for the relevant products under the CCC System. Under the Supplement IX to CEPA, on a pilot basis in Guangdong Province, the scope of certification services that can be undertaken by Hong Kong testing organisations has extended to cover food.
Under the Supplement X to CEPA, on a pilot basis in Guangdong Province, the scope has been extended further from food to other areas of voluntary product certification. Also, certification bodies, inspection bodies and laboratories jointly or solely set up in the mainland by Hong Kong service suppliers can enjoy the same treatment as their mainland counterparts. Besides, testing and certification organisations in Hong Kong are allowed to cooperate with the mainland testing and certification organisations in respect of acceptance of testing data (results).
The Agreement on Trade in Services signed in November 2015 introduced, on a pilot basis, a mutual recognition arrangement of certification and relevant testing business among Guangdong, Hong Kong and Macao in the China (Guangdong) Pilot Free Trade Zone, with a view to carrying out ‘certified once, tested once, and results accepted by three places’.