Notice of the State Council on Several Measures for Promoting Growth of Foreign Investment

· Document Number：No. 39 [2017] of the State Council

· Area of Law： Foreign-funded Enterprises

· Level of Authority： Regulatory Documents of the State Council

· Date issued：08-08-2017

· Effective Date：08-08-2017

· Status： Effective

· Issuing Authority： State Council

Notice of the State Council on Several Measures for Promoting Growth of Foreign Investment
(No. 39 [2017] of the State Council)
The people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government; all ministries and commissions of the State Council; and all institutions directly under the State Council:
Vigorously utilizing foreign investment is a major content of China's opening-up strategy. As the current economic globalization shows new characteristics, China is facing new situations and tasks in utilizing foreign investment. Relevant matters are hereby announced as follows for purposes of deepening the supply-side structural reform, advancing the reform of simplification of administrative procedures, delegation of powers, combination of decentralization and control, and optimization of services, further making China's foreign investment environment more law-oriented, internationalized and facilitating, promoting the expansion of foreign investment, and improving the quality of utilization of foreign investment:
I. Further reducing restrictions on foreign investment access
(1) Fully implementing the pre-access national treatment plus negative list administration system. Foreign investment negative lists which have been implemented in pilot free trade zones on a trial basis shall be promoted across the country as soon as possible, and the opening degree, transparency and regulation of the investment environment shall be further enhanced. (The National Development and Reform Commission and the Ministry of Commerce shall be responsible)
(2) Further expanding the scope of opening-up of market access. The opening of manufacturing of special-purpose vehicles and new energy vehicles, ship design, repair of regional airliners and utility aircrafts, international maritime transport, rail passenger transport, gas stations, business premises for the Internet access services, calling centers, performance brokerage, banking industry, securities industry, and insurance industry to foreign investment shall be continuously advanced, and the timetable and road maps of the opening shall be specified. (The Publicity Department of the CPC Central Committee, the Office of the Central Leading Group for Cyberspace Affairs, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Transport, the Ministry of Commerce, the Ministry of Culture, the People's Bank of China, the China Banking Regulatory Commission, the China Securities Regulatory Commission, the China Insurance Regulatory Commission, the National Railway Administration, the Civil Aviation Administration of China, and the China Railway Corporation shall be responsible according to the division of duties)
II. Making fiscal and tax supporting policies
(3) Encouraging overseas investors to constantly expand their investment in China. Where the profit is distributed by a resident enterprise in China to an overseas investor who directly invests it in an investment project, which is in the encouragement category and is in conformity with specified conditions, the project shall be entitled to the deferred tax payment policy and be provisionally exempt from withholding tax. (The Ministry of Finance and the State Administration of Taxation shall be responsible according to the division of duties)
(4) Bringing into play the positive role of foreign investment in optimizing the structure of trade in services. The qualified technologically advanced service enterprise income tax incentives in service outsourcing demonstration cities shall be promoted across the country, and more foreign capital shall be guided into high-technology, high value added services. (The Ministry of Finance, the Ministry of Commerce and the State Administration of Taxation, among others, shall be responsible according to the division of duties)
(5) Promoting the combination of utilization of foreign investment with outbound investment. With respect to qualified income remitted to China by China's resident enterprises (including the regional headquarters of transnational corporations) from overseas, relevant tax supporting policies shall be researched and issued. (The Ministry of Finance and the State Administration of Taxation shall be responsible according to the division of duties)
(6) Encouraging transnational corporations to invest in and establish regional headquarters in China. All regions shall be supported in issuing in accordance with the laws and regulations policies and measures attracting regional headquarters of transnational corporations, including funding support, so as to vigorously participate in the adjustment of global industry structure. (All provincial-level people's governments shall be responsible)
(7) Promoting the relocation of foreign investment into western China and old industrial bases in northeast China. The role of existing fiscal grants shall be fully brought into play, and the building of national development zones (including economic and technological development zones, high and new tech development zones and areas under special customs supervision, and the same rule applies hereinafter) in western China and old industrial bases in northeast China in the fields such as science and technology innovation, ecological and environmental protection, and public service shall be supported vigorously, in order to improve the business attraction environment, better the quality of investment introduction, and take over high-level relocated manufacturing industry. (The Ministry of Science and Technology, the Ministry of Finance, the Ministry of Commerce and the General Administration of Customs shall be responsible according to the division of duties)
(8) Supporting the construction of infrastructures and major projects of key investment attraction platforms. Provincial-level people's governments shall be encouraged to issue local government bonds to support infrastructure construction in national development zones, border economic cooperation zones, and cross-border economic cooperation zones. The pilot program of developing varieties of special local government bonds featuring self-balance of project proceeds and financing shall be accelerated, and the demand of qualified major projects in the aforesaid regions for funding shall be guaranteed in priority. (The Ministry of Science and Technology, the Ministry of Finance, the Ministry of Commerce, the General Administration of Customs, and all provincial-level people's governments shall be responsible according to the division of duties)
III. Improving the comprehensive investment environment of national development zones
(9) Fully conferring the power of investment administration on national development zones. National development zones shall be supported in conducting pilot programs of reform of relatively centralized administrative licensing power. National development zones shall be guided in further advancing the reform of simplification of administrative procedures, delegation of powers, combination of decentralization and control, and optimization of services so as to play a demonstrating and leading role in creating a good foreign investment environment and in other aspects. (The State Commission Office of Public Sectors Reform, the Ministry of Science and Technology, the Ministry of Commerce, the General Administration of Customs, and the Legislative Affairs Office of the State Council shall be responsible according to the division of duties)
(10) Supporting national development zones in guaranteeing the implementation of projects. All regions shall be allowed to, on the premise of compliance with economic and social development plans, overall planning on land utilization, and overall urban planning, prioritize and maximize the guarantees for the construction land quotas required by national development zones for projects of utilizing foreign investments. (The Ministry of Science and Technology, the Ministry of Land and Resources, the Ministry of Housing and Urban-Rural Development, the Ministry of Commerce, the General Administration of Customs, and all provincial-level people's governments shall be responsible according to the division of duties)
(11) Supporting national development zones in expanding the space to attract investment. Qualified national development zones shall be allowed to adjust or expand their zones with the approval of the State Council, adjacent and nearby development zones shall be integrated, enclave parks shall be established, and in relation to reserved land insufficiently used, facilitation such as planning adjustment and simplification of approval shall be correspondingly provided. (The Ministry of Science and Technology, the Ministry of Land and Resources, the Ministry of Housing and Urban-Rural Development, the Ministry of Commerce, the General Administration of Customs, and all local people's governments shall be responsible according to the division of duties)
(12) Supporting national development zones in improving the capability to provide services for industries. Regions with mature conditions shall introduce foreign-funded producer service enterprises, conduct pilot programs of high-technology, high value added project maintenance business at home and abroad, and promote processing trade in extending to the medium and high end of the global industry and value chains. (The Ministry of Commerce and the General Administration of Customs shall take the charge.)
IV. Facilitating entry and exit of talents
(13) Improving the foreign talent introduction system. The permit system for foreigners to work in China shall be implemented across the country, and foreign talents shall be facilitated in handling work permits by the means such as "notification plus commitment" and "acceptance notwithstanding temporary lack of some documents." In 2018, the regulation on administration of foreigners working in China will be developed and issued, and a permit system for foreigners to work in China featuring unified standards and regulated procedures will be established. (The Ministry of Foreign Affairs, the Ministry of Public Security, the Legislative Affairs Office of the State Council, and the State Administration of Foreign Experts Affairs, among others, shall be responsible according to the division of duties)
(14) Vigorously bringing in high-end international talents. In the latter half of 2017, detailed implementation rules for foreign talent visas will be developed and issued, the foreign talent appraisal standards will be improved, and the scope of issuance will be expanded; and the validity period of visas for foreign talents will be extended, and long-term (five to ten years), multi-entry visas will be issued to qualified foreigners who may apply for work permits and work-class residence certificates by virtue of the visas. Regulation on administration of permanent residence of foreigners shall be developed and issued, and the conditions and procedures for foreigners to apply for and obtain permanent residence qualifications shall be specified. (The Ministry of Foreign Affairs, the Ministry of Public Security, the Legislative Affairs Office of the State Council, and the State Administration of Foreign Experts Affairs, among others, shall be responsible according to the division of duties)
V. Optimizing the business environment
(15) Improving the foreign investment legal system without delay. The laws and regulations on Chinese and foreign investment shall be unified at a faster pace, and a new fundamental foreign investment law shall be formulated. Laws, regulations, rules and policy documents involving foreign investment shall be reviewed, and the repeal within a given period or revision of laws, regulations or provisions in contrary to the state's overall direction and principle of opening-up to the world shall be promoted. (Relevant departments and all provincial-level people's governments shall be responsible according to the division of duties)
(16) Improving services for foreign investment. The foreign-funded enterprise complaint mechanisms of the Central Government and local governments shall be improved, the prominent problems reported by overseas investors shall be coordinated and solved, the national treatment which foreign-funded enterprises are entitled to after access shall be better guaranteed, and a unified, open, orderly-competition market environment shall be created with efforts. Enterprise-related fees or charges catalog and list systems including administrative charges, government funds, and enterprise-related charges for commercial services priced by the government shall be established. (The National Development and Reform Commission, the Ministry of Finance, the Ministry of Commerce and other relevant departments, and all provincial-level people's governments shall be responsible according to the division of duties)
(17) Ensuring the free remittance of profits by overseas investors. The profits, dividends and other returns on investments obtained by any overseas investors in China may be remitted abroad freely in Chinese currency or foreign exchange in accordance with the law. (The People's Bank of China and the State Administration of Foreign Exchange shall be responsible according to the division of duties)
(18) Deepening information sharing and business coordination in the administration of foreign-funded enterprises. "Internet plus government services" shall be advanced vigorously, the mechanism of "supervision through inspections of randomly selected entities by randomly selected inspectors and the public release of inspection results" shall be further improved, and an efficient, convenient foreign investment interim and ex-post supervision and service system shall be developed. The interconnection between the information management systems of the Ministry of Commerce and the departments of industry and commerce, customs, quality inspection, and foreign exchange, among others, shall be enhanced so as to realize cross-level, cross-department sharing of the information with regard to foreign-funded enterprises from their establishment to operation. The pilot program of the acceptance mode of "single window and single form" in the business recordation and industrial and commercial registration of foreign-funded enterprises shall be conducted. (The Ministry of Commerce, the General Administration of Customs, the State Administration for Industry and Commerce, the General Administration of Quality Supervision, Inspection and Quarantine, the State Administration of Foreign Exchange and other relevant departments shall be responsible, and all local people's governments shall be responsible according to the division of duties)
(19) Encouraging foreign investment to participate in the optimization and restructuring of domestic enterprises. Procedures shall be simplified, restrictions shall be eased, and overseas investors shall be supported in establishing foreign-funded enterprises by merger and acquisition. Domestic enterprises shall be supported in introducing internationally advanced technologies, management experience and marking channels through diverse channels. Foreign investment shall be encouraged to participate in the reform of the mixed ownership system of state-owned enterprises. (The National Development and Reform Commission, the Ministry of Commerce, and the State-Owned Assets Supervision and Administration Commission of the State Council shall be responsible according to the division of duties)
(20) Improving protection of intellectual property rights of foreign-funded enterprises. Concentrated rectification action shall be taken against online infringements and piracy and infringements upon patents, exclusive right to use trademark and other intellectual property rights, judicial protection and administrative law enforcement shall be enhanced, and the punishment of illegal acts of infringements shall be enhanced. (The Office of the National Leading Group on the Fight against IPR Infringement and Counterfeiting, the State Administration for Industry and Commerce, the State Administration of Press, Publication, Radio, Film and Television, and the State Intellectual Property Office shall be responsible according to the division of duties)
(21) Improving the international competitiveness of the research and development environment. Facilitating conditions shall be created for the operation of research and development centers, the formalities for the import of samples and reagents, among others, used for research and development of qualified research and development centers shall be simplified in accordance with the law, and foreign investment in research and development shall be promoted. (The General Administration of Customs and the General Administration of Quality Supervision, Inspection and Quarantine, among others, shall be responsible according to the division of duties)
(22) Maintaining the stability and continuity of foreign investment policies. The local people's governments at various levels shall strictly honor their policy promises made to investors and foreign-funded enterprises in accordance with the law and conscientiously perform various contracts entered into in accordance with the law in business and investment attraction and other campaigns. (All provincial-level people's governments shall be responsible)
All regions and all departments shall attach great importance to the utilization of foreign investment under new situations and follow division of duties to voluntarily take action and closely cooperate with each other. The Ministry of Commerce shall strengthen supervision and inspection in conjunction with relevant departments to ensure the effective implementation of all measures, constantly improve China's new advantages in attracting investments, and promote the realization of stable growth by using foreign investment.
State Council
August 8, 2017