Notice of the State Council about Several Measures for Opening Wider to the Outside World and Actively Using Foreign Capitals

GF (2017) No. 5

People's governments of all provinces, autonomous regions and municipalities directly under the Central Government, the ministries and commissions and directly affiliated institutions under the State Council:

Utilization of foreign capitals is our basic state policy of opening-up and an important component of the open economy system, and it plays a positive role in economic development and reform deepening process. Nowadays, the global transnational investment and industrial transfer present a new tendency, our economy has deeply blended in the world economy, and the economy development enters into a new normal, thus the utilization of foreign capitals has to face the new tendency as well as new tasks. To deepen the implementation of the Opinions of the Central Committee of the Communist Party of China and the State Council about Construction of New Open Economy System, further actively use foreign capitals, create an excellent business environment, keep deepening streamline administration and institute decentralization, delegate power and strengthen regulation, optimize the service reform, reduce the systematic transaction cost to realize mutual benefit, relevant issues are noticed as below:

I.Further Opening-up

(I)Promote a new round of high-level opening-up under the guidance of the open development philosophy. Revise the Catalogue of Industries for Guiding Foreign Investment as well as relevant policies, laws and regulations, and relax the permission for foreign investment in fields such like service industry, manufacturing industry, mining industry, etc. Support foreign capitals to participate in innovation to promote the implementation of development strategies, the transformation and upgrade of manufacturing industry, as well as the entrepreneurship and development of overseas talents in China. (Under the leadership of the National Development and Reform Commission and the Ministry of Commerce)

(II) Give priority to relax the permission of foreign investment of service industry in banking financial institutions, security companies, security investment fund companies, futures companies, insurance companies, and insurance intermediaries; relax the permission of foreign investment in fields such like accounting audit, architectural design, rating service, etc.; and promote the orderly opening-up of fields such like, telecommunication, internet, culture, education, communication and transportation, etc. (Under the leadership of the National Development and Reform Commission and the Ministry of Commerce; implemented by the Ministry of Education, the Ministry of Industry and Information, the Ministry of Finance, the Ministry of Human Resources and Social Security, the Ministry of Housing and Urban-Rural Development, the Ministry of Transport, the Ministry of Culture, the People's Bank of China, the State Administration of Press, Publication, Radio, Film and Television, the Cyberspace Administration, the China Bank Regulatory Commission, the China Securities Regulatory Commission, the China Insurance Regulatory Commission, etc. as per their respective responsibilities)

(III) Give priority to cancel the permission of foreign investment of manufacturing industry in fields such like transportation facilities manufacturing, motorcycle manufacturing, fuel ethanol production, grease processing, etc. Relax the permission of foreign investment of mining industry in fields such like unconventional gas and oil such as oil shale, oil sand and shale gas, as well as mineral resources. Change the examination and approval system of foreign cooperation projects in oil and gas fields to the register system. (Under the leadership of the National Development and Reform Commission and the Ministry of Commerce; implemented by the Ministry of Industry and Information, the Ministry of Land and Resources, the State Administration of Grain, the National Energy Administration, etc. as per their respectively responsibilities)

(IV)Equally apply the "Made in China 2025" strategic policy measures to both foreign-funded enterprises and domestic enterprises. Encourage foreign investment in high-end manufacturing, intelligent manufacturing, green manufacturing, etc., as well as production service industry such as industrial design, engineering consultation, modern logistics, inspection, test and certification, etc., transform and upgrade traditional industries. (Implemented by the National Development and Reform Commission, the Ministry of Industry and Information, the Ministry of Commerce, the General Administration of Quality Supervision, Inspection and Quarantine, etc. as per their respective responsibilities)

(V) Support foreign capitals to legally participate in infrastructure construction by means of franchise, including energy, traffic, water conservancy, environmental protection, municipal utility projects, and the like. Equally apply relevant supportive policies on construction and operation of franchised foreign investment projects. (Implemented by the National Development and Reform Commission, the Ministry of Finance, the Ministry of Housing and Urban-Rural Development, the Ministry of Transport, the Ministry of Water Resources, the People's Bank of China, etc. as per their respective responsibilities)

(VI)Support research and development cooperation between foreign-invested and domestic enterprises and scientific research organizations. Support foreign-funded enterprises to set up research & development centers and enterprise technology centers, as well as apply for setting up post-doctorial scientific research stations. According to the principle of reciprocity, allow foreign-funded enterprises to participate in and undertake projects of the national science and technology plan. Equally apply preferential policies such as research & development investment weighted deduction, new high-tech enterprise and research & development center on foreign-funded enterprises. (Implemented by the National Development and Reform Commission, the Ministry of Science and Technology, the Ministry of Finance, the Ministry of Human Resources and Social Security, the Ministry of Commerce, the State Administration of Taxation, etc. as per their respective responsibilities)

(VII)Support entrepreneurship and development of high-level overseas talents in China. Give same treatment to scientific and technological enterprises established by high-level foreign talents having Foreigner's Permanent Residence Cards as that to Chinese citizens. Provide high-level foreign talents and their spouse and children of foreign nationality with convenience pursuant to laws and regulations to apply for multiple entry visa or residence certificate. (Implemented by the Ministry of Science and Technology, the Ministry of Public Security, the Ministry of Human Resources and Social Security, the State Administration of Foreign Expert Affairs, etc. as per their respective responsibilities)

II. Further Create a Fair Competitive Environment

(VIII) While preparing foreign capital policies, each department shall examine the fair competition according to the Opinions of the State Council about Establishment of Fair Competition Examination System During Market System Construction (GF (2016) No. 34); in principle, public opinions shall be sought for, and important issues shall be reported to the State Council for approval. All regions and departments shall strictly implement national policies, laws and regulations to guarantee the consistency of policy and law enforcement; unauthorized restrictions on foreign-funded enterprises are not allowed. (Implemented by the people's government of each province, autonomous region and directly-controlled municipality as well as departments of the State Council as per their respective responsibilities)

(IX)  Unless otherwise indicated by laws and regulations, or provision of foreign investor's information is necessary, relevant department shall check and approve the business license and qualification applications of foreign-funded enterprises in accordance with the principle of unified standard and unified time limit for both foreign-invested and domestic enterprises, so as to facilitate the fair competition of foreign-invested and domestic enterprises. (Implemented by the people's government of each province, autonomous region and directly-controlled municipality as well as departments of the State Council as per their respective responsibilities)

(10) Promote domestic and foreign-funded enterprises to participate in our standardization works on a fair basis. Further deepen the standardization reform, increase the transparency and openness of standard preparation and revision. Promote information disclosure of whole standard preparation and revision process, strengthen information share and social supervision during standard preparation and revision. (Under the leadership of the Standardization Administration)

(XI) Deepen the government procurement reform, stick to the principle of openness and transparency and fair competition, equally treat products made by foreign-funded enterprises in China pursuant to laws and regulations, facilitate domestic and foreign-funded enterprises to participate in government procurement bidding and tendering on a fair basis.  (Under the leadership of the Ministry of Finance)

(XII)Strictly protect intellectual properties of foreign-funded enterprises pursuant to laws and regulations. Improve intellectual property law enforcement mechanism, strengthen intellectual property law enforcement, rights protection aid and arbitration & intercession works. Strengthen construction of intellectual property foreign cooperation mechanism, facilitate relevant international organizations to set up intellectual property arbitration and intercession sub-centers in China. (Implemented by the Ministry of Commerce, the State Administration for Industry & Commerce, the State Intellectual Property Office, the National Copyright Administration, etc. as per their respective responsibilities)

(XIII)Support foreign-funded enterprises to expand their financing channels. Pursuant to laws and regulations, foreign-funded enterprises can list on the main board, the small and medium-sized enterprises board and the growth enterprise market, list on the National Equities Exchange and Quotations, issue enterprise bonds, corporation bonds and convertible bonds, and finance with non-financial enterprise debt financing instrument. (Implemented by the National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China, the China Securities Regulatory Commission, etc. as per their respective responsibilities)

(XIV)Deepen the reform of capital registration system of foreign-funded enterprises. Unless otherwise stipulated by laws and administrative regulations, the minimum registered capital requirement to foreign-invested companies shall be canceled; the unified capital registration system for domestic and foreign-funded enterprises shall be put into practice. (Implemented by the National Development and Reform Commission, the Ministry of Commerce, the State Administration for Industry & Commerce, etc. as per their respectively responsibilities)

III. Further Strengthen Foreign Investment Attraction Works

(XV)All regions shall actively carry out investment promotion events in accordance with the development philosophy of innovation, harmony, green, openness and share, based on their local actual conditions. Local governments are allowed to issue preferential investment attraction policies within their statutory extent of competence and support projects making great contributions to employment, economy development and technological innovation to reduce enterprises' investment and operation cost, as well as protects foreign-funded enterprises and their owners' equity to create an excellent investment environment. (Implemented by the people's government of each province, autonomous region and directly-controlled municipality as per their respective responsibilities)

(XVI)Support foreign-invested industries to transfer to central and west regions as well as northeast regions. Revise the Catalogue of Dominant Industries for Foreign Investment in the Central and Western Regions, expand the scope of encouraged foreign-invested industries in the central and west regions as well as northeast regions. Apply preferential income tax policies on eligible foreign-funded enterprises encouraged in west regions. Apply preferential policies about fund and land for state-supported industry transfer and processing trade on the foreign-funded enterprises transferred to the central and west regions as well as northeast regions. For foreign-funded enterprises transfer from east regions to the central, west and northeast regions, Administrations of Human Resources and Social Security shall timely handle their social insurance off-site transfer and handover procedures as per their applications. (Under the leadership of the National Development and Reform Commission; implemented by the Ministry of Industry and Information, the Ministry of Finance, the Ministry of Human Resources and Social Security, the Ministry of Land and Resources, the State Administration of Taxation, etc. as per their respective responsibilities)

(XVII）Support land use for foreign-invested projects. Apply same land acquisition policy on both domestic and foreign-funded enterprises. Keep supplying land preferentially to encouraged foreign-invested industrial projects of intensive land use, for which the land leasing base price can be determined on the basis of 70% of the minimum national industrial land leasing price corresponding to the grade of the local land. (Under the leadership of the Ministry of Land and Resources)

(XVIII)Promote the reform of RMB and foreign currency funds intensive operation management of foreign capital transnational companies. Actively attract transnational companies to set up functional institutions such as regional headquarters, procurement centers and settlement centers in China, allow foreign capital transnational companies to intensively operation RMB and foreign currency funds to facilitate the bidirectional fund flow and increase the fund utilization ratio as well as the investment convenience degree. (Implemented by the People's Bank of China, the State Administration of Foreign Exchange, etc. as per their respective responsibilities)

(XIX)Improve external debt management system of foreign-funded enterprises. Unify external debt management of domestic and foreign-funded enterprises, improve enterprises' foreign exchange management, promote the overseas financing capability and convenience of foreign-funded enterprises. (Implemented by the National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China, the State Administration of Foreign Exchange, etc. as per their respective responsibilities)

(XX)Deepen the reform of foreign investment management system. Facilitate the "National Treatment + Negative List" management mode before admittance is fully implemented on foreign investment, simplify management procedure of foreign-invested projects as well as establishment and change management of foreign-funded enterprises. Facilitate interlinking of approval procedures, shorten the handling time of custom registration and invoice application procedures, etc. Strengthen the construction of E-government, carry out one-window reception, time-limit completion and progress query, and promote the informationalized level of foreign investment management. Facilitate the construction of pilot free trade zone, publicize and copy the experience in a larger range. (Implemented by the National Development and Reform Commission, the Ministry of Commerce, the General Administration of Customs, the State Administration of Taxation, the State Administration for Industry & Commerce, etc. as per their respective responsibilities)

All regions and departments shall fully understand the significance of doing excellent foreign capital utilization works under the new tendency, pay high attentions to these works, take active measures, strengthen responsibilities, and make close cooperation. The National Development and Reform Commission and the Ministry of Commerce shall strengthen the supervision and examination jointly with other departments concerned, so as to ensure all policies and measures are put into practice. In connection with the implementation of policies and measures, great efforts shall be contributed to create a more open, convenient and transparent business environment, in order to actively attract foreign investment as well as advanced technology and management experience, stabilize the foreign investment scale and speed, increase the level and quality of foreign capital utilization, facilitate a new round of high-level opening-up, and facilitate the reform and development by opening up.

The State Council

12.01.17