Provisions on Guiding Foreign Investment Direction
Decree [2001] No.336 of the
State Council The Regulation of the People's Republic of China
on the Administration of Insurance Companies with Foreign
Investment has been passed at the 49th executive meeting of
the State Council on December 5, 2001 an d is hereby promulgated
for implementation as of February 1, 2002.Premier of the State
Council: Zhu Rongji December 12, 2001(11-26 10:47)
Article 1: These provisions
are formulated according to the related legal provisions on
foreign investment and requirements of industrial policies
of the State in order to guide the direction of foreign investment,
to make foreign investment in accordance with the plan of
the national economy and social development of our country,
and to serve the purpose of protecting legitimate rights and
interests of investors.
Article 2: These provisions
shall apply to the projects of Sino-foreign equity joint ventures,
Sino-foreign contractual joint ventures, wholly foreign owned
enterprises (hereafter referred to as "foreign investment
enterprises"), as well as to other forms of foreign investment
(hereafter referred to as "foreign investment projects")
within the territory of the People's Republic of China.
Article 3: The State Development Planning Commission (SDPC),
the State Economy and Trade Commission (SETC) and the Ministry
of Foreign Trade and Economic Cooperation (MOFTEC), in conjunction
with the concerned ministries of the State Council, shall
formulate Catalogue for the Guidance of Foreign Investment
Industries and Catalogue of Advantaged Industries for Foreign
Investment in Mid-west China, and promulgate these Catalogues
after approval of the State Council.
According to practical circumstance
that partial adjustment need to be made to these Catalogues,
SETC, SDPC and MOFTEC, in conjunction with the concerned ministries
of the State Council shall make revision and promulgation
in time.
Catalogue for the Guidance of
Foreign Investment Industries and Catalogue of Advantaged
Industries for Foreign Investment in Mid-west China shall
be the basis for the guidance of examination and approval
of foreign investment projects and for the policy application
of foreign investment enterprises.
Article 4: Foreign investment
projects shall be classified into four categories: encouraged,
permitted, restricted and prohibited projects.
Foreign investment projects
belonging to encouraged, restricted and prohibited categories
are listed in Catalogue for the Guidance of Foreign Investment
Industries. Those permitted foreign investment projects which
do not belong to the above three categories are not to be
listed in Catalogue for the Guidance of Foreign Investment
Industries.
Article 5: Those foreign investment
projects under one of the following circumstances shall be
listed as encouraged foreign investment projects:
1. Projects for new agricultural technology, comprehensive
agricultural development and for energy, transportation and
key raw materials industries;
2. Projects for new and high technology, advanced applicable
technology which can improve performance of products and increase
techno-economic efficiency of enterprises or produce new equipment
and new material that domestic capacity is deficient.
3. Projects that meet market demands, and can promote the
quality of products, enter into new markets or strengthen
the competing capability of products in international markets;
4. Projects adopting new technology and new equipment for
saving energy and raw materials, for comprehensive utilization
of resources and renewable resources, and for prevention environment
pollution;
5. Projects that can make full use of man power and resource
advantage in mid-west region and are in accordance with the
State's industrial policies;
6. Other cases that are regulated by laws and administrative
regulations of the State.
Article 6: Those foreign investment
projects under one of the following circumstances shall be
listed as restricted foreign investment projects:
1. Projects adopting out-of-date technologies;
2. Projects unfavorable to resource-saving and ecological
environment improvement;
3. Projects for prospecting and/or mining specified mineral
resources protected by laws and regulations of the State;
4. Projects in those industries that shall be opened gradually;
5. Other cases that are regulated by laws and administrative
regulations of the State.
Article 7: Those foreign investment
projects under one of the following circumstances shall be
listed as prohibited foreign investment projects:
1. Projects that endanger the safety of the State or damage
social and public interests;
2. Projects that pollute environment, destroy natural resources
or impair the health of human beings;
3. Projects that occupy large amounts of arable land, unfavorable
to protection and development of land resources;
4. Projects that endanger the safety of military facility
and its performance;
5. Projects that adopt the unique craftsmanship or technology
of our country to make products;
6. Other cases that are regulated by laws and administrative
regulations of the State.
Article 8: "Equity joint
venture and contractual joint venture only" or "Chinese
partners shall hold the majority of shares" or "Chinese
partners shall hold relative majority of shares" may
be regulated for certain foreign investment projects in Catalogue
for the Guidance of Foreign Investment Industries.
"Equity joint venture and
contractual joint venture only" means that such projects
shall be conducted in forms of Chinese-foreign equity joint
venture and Chinese-foreign contractual joint venture only;
"Chinese partner shall hold the majority of shares"
means that the sum of shares held by Chinese investor(s) of
such a project shall be 51% of the total or up; "Chinese
partner shall hold the relative majority of shares" means
that the sum of shares held by Chinese investor(s) of such
a project shall greater than the shares held by any single
foreign investor in the project.
Article 9: Encouraged foreign
investment projects apart from the preferential terms stipulated
in the relevant laws or administrative regulations of the
State, may enlarge their scope of business with approval,
if they are engaged in the construction and operation of infrastructure
facilities related to energy, transportation and urban utility
sectors (coal, oil, natural gas, power, railway, highway,
port, airport, urban road, sewerage treatment and garbage
disposal, etc.), which need a large amount of investment and
a long payoff period.
Article 10: Those permitted
projects that export all their products directly shall be
deemed as encouraged projects. Restricted foreign investments
may be deemed as permitted foreign investment projects with
approval from the government of provinces, autonomous regions,
municipalities directly under the Central Government or cities
of direct planning by the State, if the export sales of products
amount to over 70% of the total sales of the product.
Article 11: Restrictions can
be properly eased for those permitted and restricted foreign
investment projects that can really make full use of the advantages
of mid-west regions. Those projects which listed in Catalogue
of Advantaged Industries for Foreign Investment in Mid-west
China can enjoy preferential treatments for encouraged foreign
investment projects.
Article 12: With existing project
approval authorization, foreign investment projects shall
be examined and approved or be filed for record by development
planning departments and economy and trade departments respectively
according to the construction nature of the projects. Contracts
and articles of associations of foreign investment enterprises
shall be examined and approved or be filed for record by the
departments in charge of foreign trade and economic cooperation.
Those restricted foreign investment projects whose investment
is lower than the competence limit shall be examined and approved
by corresponding competent departments of provinces, autonomous
regions, municipalities directly under the Central Government
or cities of direct planning by the State and shall be filed
for record to higher-up responsible ministries and corresponding
line ministries simultaneously. The approval authorization
for restricted foreign investment projects shall not be allowed
to be delegated to the lower levels. Foreign investment projects
in service sectors that shall be opened gradually should be
examined and approved according to relevant regulations of
the State.
Foreign investment projects
that involve issues of quota or license shall apply to the
competent departments of foreign economy and trade for quota
or license.
If laws or administrative regulations
have otherwise stipulations concerning the procedures and
measures of examination and approval of foreign investment
projects, stipulations of those laws or administrative regulations
shall be followed.
Article 13: Examination and
approval organs of higher levels shall cancel the foreign
investment projects that are examined and approved in violation
of these Provisions within 30 working days after receiving
the recorded files of the concerned projects. The contracts
and articles of association shall be invalid. The enterprise
registration organs shall not register these projects. And
the Customs shall not handle import or export formalities
for these projects.
Article 14: The relevant parties
of foreign investment projects who have obtained approval
of the project through swindle or other illicit means shall
be investigated for legal responsibility in the light of the
seriousness of cases according to law. The examination and
approval organs shall cancel the approval of the project,
and relevant competent units should deal with these projects
correspondingly according to the law.
Article 15: Staff of examination
and approval organs who abuse their authority, neglect their
duties, shall be investigated for criminal responsibility
as the crime of authority abusing or the crime of duty neglecting
according to the criminal law. In cases that offenses are
not serious enough to trigger criminal punishments, disciplinary
sanctions harsher than special demerit for record shall be
applied according to laws.
Article 16: Investment projects
sponsored by overseas Chinese and investors from Hong Kong
Special Administrative Region, Macao Special Administrative
Region and Taiwan region shall be handled by reference of
these provisions.
Article 17: These provisions
shall enter into force on Apr. 1, 2002. And Interim Provisions
on Guiding Foreign Investment Direction promulgated by the
State Planning Commission, SETC and MOFTEC on Jun. 20, 1995
shall be abrogated simultaneously.
- End - |