We present in this paper a new class of punctured convolutional codes that are complementary (CPC codes), A set of punctured convolutional codes derived from the same original low rate code are said to be complementary if they are equivalent (in terms of their distance properties) and if when combined yield at least the original low rate code. Based on these CPC codes we propose and analyze a variation of the type II hybrid ARQ scheme which we call type III hybrid ARQ scheme, With the type III hybrid ARQ scheme, the starting code rate can be chosen to match the channel noise requirements, and like with the type II scheme, packets that are detected in error are not discarded, but are combined with complementary transmissions provided by the transmitter to help recover the transmitted message, The main advantage is that any complementary sequence sent for a packet that is detected with errors is self decodable. That is the decoder does not have to rely on previously received sequences for the same data packet for decoding, as is generally the ease with incremental redundancy ARQ schemes, This feature is desirable especially in situations where a transmitted packet can be lost or severely damaged as a result of interference, CPC codes can find applications in diversity transmissions systems, A novel complementary diversity scheme which makes use of CPC codes is briefly discussed.