During their talks in Hong Kong from October 28 to 30, 1992, representatives of the mainlandbased Association for Relations Across the Taiwan Straits (ARATS) and the Straits Exchange Foundation (SEF) in Taiwan discussed the definition of the "One China principle" in cross-Straits commercial exchanges. ARATS offered that the definition can be left open to discussion, so long as the Taiwan side acknowledges the "one China principle." After more rounds of discussions, a SEF representative proposed: the "one China principle" shall be interpreted by each side in a way it sees fit.

On November 16, ARATS delivered an official notification to the SEF that its proposal would be respected and accepted, and that the political meaning of "one China" is not to be discussed in cross-Straits commercial talks. In its reply on December 3, the SEF expressed agreement, and the ultimate accord came to be commonly referred to as the "1992 Consensus."

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