Formal Promulgation of Foreign Investment Negative List, More Publicity m88 bonus Transparency for Market Entry by Foreign Investors in China——Brief Comments on Catalogue of Industries for Guiding Foreign Investment (2017 Revision)
2017.07.10m88 casino bonus code、Yang LIU
The Catalogue m88 bonus Industries for Guiding Foreign Investment (2017 Revision) (“2017 Catalogue”) was jointly promulgated by the National Development m88 bonus Reform Commission (“NDRC”) m88 bonus the Ministry of Commerce (“MOC”) on June 28, 2017. This is the seventh revision to the Catalogue m88 bonus Industries for Guiding Foreign Investment since its implementation. It also indicates the start m88 bonus the formal application m88 bonus the Foreign Investment Negative List nationwide.
I. Overview m88 bonus the Reform m88 bonus Legal Regime for Foreign Investment
The Stm88 bonusing Committee of the National People's Congress revised four laws including the Law of the People’s Republic of China on Foreign-Invested Enterprises m88 bonus the Law of the People's Republic of China on Sino-foreign Equity Joint Ventures September to October 2016. Subsequently, NDRC m88 bonus MOC jointly promulgated the Interim Administrative Measures for Record Filing of the Establishment m88 bonus Change of Foreign-Invested Enterprises. It is provided for in each of these laws that the process for establishing or changing foreign-invested enterprises shall be administered by record filing instead of approval procedures, as long as no special administrative measures for market entry are involved. This officially establishes the implementation of a record-filing system for foreign investment. But the special administrative measures for market entry by foreign investment in conjunction with the record-filing system for foreign investment have fallen behind this promulgation. Announcement No. 22 (“Announcement No. 22”) was jointly promulgated by NDRC m88 bonus MOC, clarifying that the scope of special administrative measures for market entry by foreign investment shall include the restrictions under the Restricted Categories m88 bonus the Prohibited Categories, as well as the requirements of equity percentage or qualification of senior management under the Encouraged Categories, as set forth in the Catalogue of Industries for Guiding Foreign Investment (2015 Revision) (“2015 Catalogue”).
In January 2017, the Circular concerning Several Measures for the Expansion of Opening-Up m88 bonus the Active Use of Foreign Investment (the “State Council Circular”) was promulgated by the State Council, expressly providing for that the opening-up should be further expm88 bonused; the Catalogue of Industries for Guiding Foreign Investment m88 bonus relevant rules m88 bonus policies should be revised to reduce access restrictions on foreign investment in service, manufacturing, mining m88 bonus other sectors; m88 bonus foreign investments are supported for the implementation of the innovation-driven development strategy, the transformation m88 bonus upgrading of manufacturing sectors, m88 bonus career development for overseas talents through entrepreneurship in China.
In this context, the 2017 Catalogue was m88 bonusficially promulgated after the solicitation for public comments.
II.Major Changes in 2017 Catalogue
1.Further Reduction of Restrictive Measures, m88 bonus Expansion of Opened Sectors
The 2017 Catalogue has further reduced the restrictive items. There are a total of 63 items (including 35 restricted items m88 bonus 28 prohibited items) subject to restrictive measures in 2017 Catalogue, which is 30 items less than the 93 items (including 19 encouraged items subject to equity percentage requirement, 38 restricted items m88 bonus 36 prohibited items) in the 2015 Catalogue1. The excluded items mainly fall under manufacturing, service m88 bonus mining sectors, see the table below.
(a)The Following Restricted Items are no Longer Included in m88 bonus Investment Negative List
2015 CatalogueRestricted Categories |
Exploration m88 bonus mining of noble metals (gold, silver m88 bonus platinum groups) |
Mining m88 bonus mine exploration for lithium |
Processing of edible oils m88 bonus fats from soybean, rapeseed, peanut, cottonseed, camellia seed, sunflower seed, palm (with Chinese parties as the controlling shareholders), processing of rice, flour m88 bonus crude sugar, m88 bonus deep processing of corn |
Production of biological liquid fuels including fuel ethanol m88 bonus biodiesel (with Chinese parties as the controlling shareholders) |
Smelting of rare metals including molybdenum, tin (excluding tin compounds), antimony (including antimony oxides m88 bonus antimony sulphides) |
Manufacturing of motorcycles: Chinese parties shall hold at least 50% of the shares. One foreign investor may establish no more than two equity joint ventures in the Mainlm88 bonus to manufacture the same category of motorcycles |
Highway passenger transport companies |
Construction m88 bonus operation of large-scale agricultural products wholesale markets |
Ocean shipping tally companies (limited to Sino-m88 bonus equity/cooperative joint venture operations) |
Credit investigation m88 bonus rating service companies |
(b)Removal m88 bonus Restrictive Requirements under Encouraged Items
2015 CatalogueEncouraged Categories | 2017 Catalogue |
Exploration m88 bonus exploitation of oil shale, oil sm88 bonuss, shale gas, coal-bed methane m88 bonus other unconventional oil m88 bonus gas (limited to Sino-foreign equity/cooperative joint venture operations) | Still Encouraged Category; Not limited to Sino-m88 bonus equity/cooperative joint venture operations |
Utilization m88 bonus mine gas (limited to Sino-foreign equity/cooperative joint venture operations) | Still Encouraged Category; Not limited to Sino-m88 bonus equity/cooperative joint venture operations |
Automobile electronic bus network technologies (limited to Sino-m88 bonus equity joint venture operations) | Still Encouraged Category; Not limited to Sino-m88 bonus equity joint venture operations |
Electronic controllers for electric power steering system (limited to Sino-m88 bonus equity joint venture operations) | Still Encouraged Category; Not limited to Sino-m88 bonus equity joint venture operations |
Design m88 bonus manufacture of civil satellites, m88 bonus manufacture of civil satellite payloads (with Chinese parties as the controlling shareholders) | Still Encouraged Category; Not limited to Chinese parties as the controlling shareholders |
Manufacture of key parts m88 bonus components of new energy automobiles: high energy power batteries (energy density ≥110Wh/kg, cycle life ≥2000 times m88 bonus the proportion of foreign investment not exceeding 50%) | Removed; Not included in m88 bonus Investment Negative List |
Track transportation equipment (limited to Sino-m88 bonus equity/cooperative joint venture operations) | Removed; Not included in m88 bonus Investment Negative List |
Manufacture m88 bonus repair of marine engineering equipment (including modules) (with Chinese parties as the controlling shareholders) | Removed; Not included in m88 bonus Investment Negative List |
Manufacture of low m88 bonus medium-speed diesel engines of vessels m88 bonus bent axle (with the Chinese Parties holding majority of the shares) | Removed; Not included in m88 bonus Investment Negative List |
Accounting m88 bonus auditing (the chief partner shall be of Chinese nationality) | Removed; Not included in m88 bonus Investment Negative List |
Construction m88 bonus operation of comprehensive water control projects (with Chinese parties as the controlling shareholders | Removed; Not included in m88 bonus Investment Negative List |
(c)Certain Encouraged Items with Restrictive Measures are Incorporated into Foreign Investment Negative List, Continue to Enjoy Preferential Industrial Policies m88 bonus Encouraged Category
2015 CatalogueEncouraged Categories | 2017 Catalogue |
Exploration m88 bonus exploitation of oil m88 bonus natural gas (including oil shale, oil sm88 bonuss, shale gas, coal-bed methane m88 bonus other unconventional oil m88 bonus gas) (limited to Sino-foreign equity/cooperative joint venture operations)Encouraged Category + Foreign Investment Negative List (Restricted Category) (excluding unconventional oil m88 bonus gas); | Same restrictions on equity percentage |
Design, manufacture m88 bonus maintenance of civil aircrafts: aircrafts for trunk lines, regional aircrafts (with Chinese parties as the controlling shareholders), m88 bonus general aircrafts (limited to Sino-foreign equity/cooperative joint venture operations) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Design m88 bonus manufacture of civil helicopters: those of three tons or more (with Chinese parties as the controlling shareholders) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Manufacturing of ground-effect m88 bonus water-effect aircrafts, m88 bonus design m88 bonus manufacturing of UAV m88 bonus aerostats (with Chinese parties as the controlling shareholders) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Construction m88 bonus operation of nuclear power stations (with Chinese parties as the controlling shareholders) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Construction m88 bonus operation of power grids (with Chinese parties as the controlling shareholders) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Construction m88 bonus operation of network of trunk railway lines (with Chinese parties as the controlling shareholders) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage remains |
Construction m88 bonus operation of civil airports (with the Chinese Parties holding a relative majority of the shares) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
Air transportation companies (with Chinese parties as the controlling shareholders, m88 bonus the investment of a single foreign investor m88 bonus its affiliated enterprises not exceeding 25%) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage; Legal Representative must have Chinese nationality |
General airline companies for agriculture, forestry, m88 bonus fishery (limited to Sino-foreign equity/cooperative joint venture operations) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Limited to Sino-m88 bonus equity joint venture operations; Legal Representative must have Chinese nationality |
Scheduled or non-scheduled international marine transportation services (limited to Sino-m88 bonus equity/cooperative joint venture operations) | Encouraged Category + Not included in m88 bonus Investment Negative List (Restricted Category); Same restrictions on equity percentage |
2.Structure Adjustment m88 bonus Establishment of Foreign Investment Negative List
Another major change of the 2017 Catalogue is a structural adjustment. Different from the long-lasting three-part structure consisting of Encouraged Categories, Restricted Categories m88 bonus Prohibited Categories, the 2017 Catalogue is composed of two parts: Encouraged Categories m88 bonus the Special Administrative Measures for Market Entry by Foreign Investment (Foreign Investment Negative List).
The Special Administrative Measures for Market Entry by Foreign Investment (Foreign Investment Negative List) includes restricted items m88 bonus prohibited items, consolidates certain encouraged items with restrictions on equity percentage, m88 bonus deletes 11 restricted m88 bonus prohibited items applicable to both domestic m88 bonus foreign investment under the 2015 Catalogue, see details below.
Restricted/Prohibited Items Applicable to Both Domestic m88 bonus Foreign Investment |
-Construction m88 bonus operation of, in small grids, power plants using coal-fired m88 bonus steam condensation thermal generator sets with a single generator capacity of 300,000 kilowatts or less, m88 bonus thermoelectric power stations using coal-fired, steam condensation m88 bonus extraction thermal generator sets with a single generator capacity of 100,000 kilowatts or less |
-Construction m88 bonus operation of large theme parks; |
-Processing of traditional Chinese medicinal materials listed in the Regulations on the Administration for Protection of Wild Medicinal Resources m88 bonus the Catalogue of China's Rare m88 bonus Endangered Plants under Protection; |
-Ivory carving; |
-Tiger bone processing; |
-Construction m88 bonus operation of, within mass grids, power plants using coal-fired m88 bonus steam condensation thermal generator sets with a single generator capacity of 300,000 kilowatts or less, m88 bonus thermoelectric power stations using coal-fired, steam condensation m88 bonus extraction thermal generator sets with a single generator capacity of 200,000 kilowatts or less; |
-Education institutions in military affairs, police, politics m88 bonus other special fields, m88 bonus Party schools; |
-Construction of golf courses m88 bonus villas; |
-Projects endangering the safety m88 bonus performance of military facilities; |
-Gambling m88 bonus lottery industry (including horse race tracks for gambling purposes); |
-Pornography industry. |
The promulgation of Special Administrative Measures for Market Entry by Foreign Investment (Foreign Investment Negative List) will increase the transparency of foreign investment regime in China m88 bonus foreign investors may easily refer to it for restrictions applicable to investments under consideration with respect to the market entry, equity percentage m88 bonus qualifications of senior management.
3.Increase in Encouraged Items m88 bonus Promotion of Industrial Restructuring m88 bonus Optimization
In addition to the reduction of restricted items, the 2017 Catalogue has increased certain encouraged items, such as, development m88 bonus production of formula food for special medical use; research & development m88 bonus manufacture of Virtual Reality (VR) m88 bonus Augmented Reality (AR) equipment; research & development m88 bonus manufacture of 3D printing equipment key components; construction m88 bonus operation of hydrogen refueling stations; manufacture of intelligent emergency medical rescue equipment; manufacture of hydrological monitoring sensors; manufacture of flue gas desulfurization equipment m88 bonus flue gas dust removal equipment; construction m88 bonus operation of urban parking facilities; m88 bonus so on – so as to further encourage foreign investment in the areas like advanced manufacturing, high technology, energy saving technologies, environmental protection technologies, etc.
III.Other Changes
In addition to the above reduction of restrictive measures m88 bonus structural adjustments mentioned above, we also noted that the 2017 Catalogue has strengthened the restrictions on foreign investment in cultural areas under the Foreign Investment Negative List. For example, the 2015 Catalogue prohibits foreign investment in the publishing of books, newspapers, periodicals, audio-visual products m88 bonus electronic publications; m88 bonus in the 2017 Catalogue such prohibition has been expm88 bonused to include editing m88 bonus publishing thereof. Furthermore, the 2017 Catalogue also added three more prohibited items, prohibiting foreign investment in radio m88 bonus video on-demm88 bonus businesses m88 bonus satellite television broadcasting ground receiving facilities installation services; internet public information service; m88 bonus the establishment m88 bonus operation of humanities m88 bonus social sciences research institutes.
The 2017 Catalogue also provides that, if any domestic company or enterprise or Chinese individual acquires a domestic company affiliated thereto by a company that it has legitimately established or controls outside China (“Affiliated Acquisition”), the resulting establishment or change of a foreign-invested project m88 bonus an enterprise shall be dealt with according to the existing regulations. We understm88 bonus based on such provisions that the Affiliated Acquisition shall still be subject to the approval of MOFCOM as set forth under the Provisions on Foreign Investors' Merger with m88 bonus Acquisition of Domestic Enterprises. The amended Interim Administrative Measures for Record Filing of the Establishment m88 bonus Change of Foreign-Invested Enterprises is still currently under the period for soliciting public comments. Upon the adoption of the amendment, the process for establishing m88 bonus changing a foreign-invested enterprise (resulting from an acquisition by foreign investors falling outside the scope of the Foreign Investment Negative List) shall be subject to the record-filing system. However, the acquisition by foreign investors under the Foreign Investment Negative List shall still be subject to approval procedures.
1. Response to reporters regarding Catalogue of Industries for Guiding Foreign Investment (2017 Revision) by a relevant official from National Development m88 bonus Reform Commission
http://www.ndrc.gov.cn/xwzx/xwfb/201706/t20170628_852888.html
