The Government of China’s Hong Kong Special Administrative Region has signed a comprehensive avoidance of double taxation agreement (CDTA) with Serbia, signifying the government’s sustained efforts in expanding Hong Kong’s tax treaty network, a government spokesman said Friday.

The CDTA is the 44th such agreement that Hong Kong has concluded. It sets out the allocation of taxing rights between the two jurisdictions and will help investors better assess their potential tax liabilities from cross-border economic activities.

Serbia is one of the emerging economies participating in China’s Belt & Road Initiative, which brings about vast business opportunities.

The CDTA will promote economic and trade connections between China’s Hong Kong and Serbia, and offer additional incentives for the business sector of both sides to do business or make investments, Secretary for Financial Services and Treasury Christopher Hui said.

Under the CDTA, double taxation will be avoided in that any tax paid in Serbia by Hong Kong companies in accordance with the CDTA will be allowed as a credit against the tax payable in China’s Hong Kong on the same income, subject to the provisions of the tax laws of Hong Kong.

Likewise, for Serbian Companies, the tax paid in China’s Hong Kong will be allowed as a deduction from the tax payable on the same income in Serbia.