Hong Kong and Jordan Sign Comprehensive Double Taxation Agreement (CDTA)

Fore The Hong Kong–Jordan Comprehensive Double Taxation Agreement (CDTA)  reduces withholding taxes, eliminates double taxation, and provides legal clarity, fostering cross-border investment and trade.

Hong Kong and Jordan have signed a new Comprehensive Avoidance of Double Taxation Agreement (CC) marking an important step in strengthening economic and financial cooperation between the two jurisdictions.

The agreement was signed on September 4, 2025, in Beijing by Christopher Hui, Hong Kong’s Secretary for Financial Services and the Treasury, and Hussam Al Husseini, Jordan’s Ambassador to China.

In this article, we examine the main features of the new Hong Kong–Jordan CDTA and its implications for investors and businesses.

What does the new Hong Kong–Jordan CDTA mean?

The newly signed CDTA between Hong Kong and Jordan is designed to provide clarity and predictability for businesses engaged in cross-border activities. Indeed, its primary objective is to eliminate the risk of income being taxed in both jurisdictions, while also setting clear rules for the allocation of taxing rights. This framework allows investors to better assess their tax liabilities and structure their operations with greater certainty.

Strategically, the CDTA highlights Hong Kong’s efforts to reinforce its role as a global financial hub by expanding its treaty network, which now covers 53 jurisdictions. For Jordan, the agreement provides a platform to integrate more deeply into the Belt and Road Initiative (BRI), offering its businesses preferential access to one of Asia’s most dynamic financial markets.

Together, the two economies are laying the groundwork for stronger financial, trade, and investment ties, supported by a more favorable tax environment.

Key provisions of the Hong Kong–Jordan CDTA

The new Hong Kong–Jordan DTA introduces a set of provisions that are intended to reduce tax burdens, improve cross-border certainty, and encourage greater bilateral investment. Below we outline the main areas of change.

Dividends

Under the DTA, Jordan’s withholding tax rate on dividends payable to Hong Kong residents will be capped at 5 percent, compared to the previous rate of up to 10 percent. Indeed, this lower rate creates a more favorable environment for profit repatriation, particularly for companies with equity investments across the two jurisdictions. For businesses, the reduced dividend tax directly translates into improved after-tax returns, making cross-border equity investment more attractive and predictable.

Interest

The DTA sets a maximum withholding tax rate of 5 percent on interest payments. This provision facilitates easier access to financing and lowers the cost of capital for businesses engaged in bilateral trade or investment. By reducing the tax burden on cross-border lending and borrowing, the agreement supports the development of smoother financing channels, which can be particularly beneficial for infrastructure, trade finance, and other investment-linked projects.

Royalties

For royalties, the DTA reduces the withholding tax rate from the current level of 10 percent to a cap of 5 percent for Hong Kong residents. This measure significantly lowers the cost of cross-border technology transfers, licensing arrangements, and intellectual property transactions. By making it cheaper to license technology and commercial rights, the provision encourages knowledge transfer and fosters innovation-driven cooperation between Hong Kong and Jordan.

Double taxation relief

The agreement ensures that Hong Kong residents who pay tax in Jordan on income sourced there can credit the tax paid against their Hong Kong tax liabilities, in accordance with the Inland Revenue Ordinance (Cap. 112). This mechanism eliminates the risk of income being taxed twice and provides clarity for individuals and corporations planning cross-border operations. In practical terms, the relief provision improves predictability, reduces compliance burdens, and enhances overall investment planning.

Implementation process

The Hong Kong–Jordan DTA will enter into force once both sides complete the necessary ratification steps. In Hong Kong, this will require an order made under the Inland Revenue Ordinance (Cap. 112) by the Chief Executive in Council, subject to Legislative Council vetting.

The agreement’s provisions will then apply from the date specified in the ratification instruments, ensuring legal certainty for businesses operating across the two jurisdictions.

Strategic implications for Hong Kong–Jordan relations

The CDTA is expected to stimulate trade and investment flows by providing a clearer tax landscape for businesses operating across borders. For instance, Jordanian exports to Hong Kong were valued at approximately US$19.14 million in 2023. With the new tax provisions, Jordanian businesses may find it more attractive to engage with Hong Kong’s dynamic market.

Conversely, Hong Kong’s exports to Jordan were around US$4.31 million in 2023, and the CDTA could encourage Hong Kong enterprises to explore opportunities in Jordan, particularly in sectors like renewable energy, technology, and infrastructure.

Meanwhile, comprehensive trade flows between China and Jordan reached approximately $2.3 billion in 2024, reflecting growing commercial engagement across multiple sectors, including chemicals, machinery, and consumer goods.

Implications for Jordan businesses

As of 2025, the Hong Kong–Jordan CDTA complements these efforts by providing Jordanian investors with greater access to Hong Kong’s international financial markets, including capital markets and the city’s growing gold trading sector. Reduced withholding taxes on dividends, interest, and royalties, together with clear rules for double taxation relief, improve investment predictability and reduce compliance burdens. These measures make it easier for Jordanian companies to channel funds into international expansion, technology acquisition, and joint ventures, supporting economic diversification beyond traditional infrastructure projects.

Implications for Hong Kong businesses

From Hong Kong’s perspective, the CDTA strengthens the city’s role as a global financial hub and as a gateway for Middle Eastern companies into Asia. By establishing a transparent legal and fiscal framework, the agreement enhances Hong Kong’s attractiveness for Jordanian investment, while also facilitating financial and commercial linkages between Hong Kong, Jordan, and wider regional markets.

BRI and key cooperation sectors

In addition to BRI-related projects, the DTA is likely to stimulate collaboration in sectors such as renewable energy, fintech, education, and logistics.

For instance, Hong Kong-based financial institutions may explore investment opportunities in Jordanian ventures, while technology and education partnerships can benefit from clearer cross-border tax arrangements.

On the other hand, this multidimensional engagement aligns with Jordan’s national development priorities, including economic diversification, innovation, and capacity-building, and further consolidates its role as a regional hub for trade and investment.

In short

In conclusion, the Hong Kong–Jordan CDTA is more than a bilateral agreement: it is a strategic tool that supports economic diversification, enhances financial connectivity, and promotes regional cooperation.

Besides, as both regions move forward, this agreement is expected to play a pivotal role in shaping their economic landscapes and fostering long-term prosperity.

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