Notice of the State Council on Several Measures for Expanding Opening Up and Vigorously Using Foreign Capital

• Document Number：No. 5 [2017] of the State Council
• Area of Law： Reform and Opening-up
• Level of Authority： Regulatory Documents of the State Council
• Date issued：01-12-2017
• Effective Date：01-12-2017
• Status： Effective
• Issuing Authority： State Council

Notice of the State Council on Several Measures for Expanding Opening Up and Vigorously Using Foreign Capital
(No. 5 [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:
The use of foreign capital, as an important part of China‘s basic state policy of opening up and the open economic system, has played a positive role in economic development and the progress of the deepening of reform. Currently there appears to be a new trend in global transnational investment and industry transfer, China's economy has been integrated into the world economy in depth, the economy has entered the phase of new normal, and there is new conditions and tasks challenging the use of foreign capital. For the purposes of implementing in depth the Several Opinions of the CPC Central Committee and the State Council on Building a New Open Economic System, further vigorously making use of foreign capital, creating a good business environment, constantly deepening the reform of the simplification of administrative procedures, the delegation of powers, the combination of decentralization and control, and service optimization, reducing institutional trading cost, and realizing reciprocity and win-win, the relevant matters are announced as follows:
I. Further expanding opening up.
(1) Following the guidance by the concept of open development and promoting a new round of high-level opening up. The Catalog of Industries for Guiding Foreign Investment and relevant policies and regulations shall be revised, and the restrictions on foreign capital access to the service industry, the manufacturing industry, the mining industry and other fields shall be relaxed. Support shall be provided to foreign investment in the implementation of the innovation-driven development strategy, transformation and upgrade of the manufacturing industry, and the entrepreneurship and development of overseas talents in China. (The National Development and Reform Commission and the Ministry of Commerce shall take the lead)
(2) In services, the restrictions on the access of foreign capital to banking financial institutions, securities companies, securities investment fund management companies, futures companies, insurance institutions, and insurance intermediary agencies shall be relaxed, the restrictions on the access of foreign capital to accounting, audit, architecture design, rating services and other fields shall be removed, and the orderly opening up of telecommunications, the Internet, culture, education, transport and other fields shall be advanced. (The National Development and Reform Commission and the Ministry of Commerce shall take the lead, and the Ministry of Education, the Ministry of Industry and Information Technology, 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 of China, the China Banking Regulatory Commission, the China Securities Regulatory Commission and the China Insurance Regulatory Commission shall be responsible according to the division of functions)
(2) In the manufacturing industry, the restrictions on the access of foreign capital to the manufacturing of rail transport equipment and motorcycles, production of fuel-grade ethyl alcohol, grease processing and other fields shall be canceled. In the mining industry, the restrictions on the access of foreign capital to oil shales, oil sand, shale gas and other unconventional oil gas and the field of mineral resources shall be relaxed. The approval system of foreign cooperation programs in the fields of petroleum and natural gas shall be modified to a filing system. (The National Development and Reform Commission and the Ministry of Commerce shall take the lead, and the Ministry of Industry and Information Technology, the Ministry of Land and Resources, the State Administration of Grain and the National Energy Administration shall be responsible according to the division of functions)
(4) The "Made in China 2025" strategic policies and measures equally applicable to foreign-funded and Chinese-funded enterprises. Foreign investment in high-end, intelligent and green manufacturing and producer service industries such as industrial design and creation, engineering consultation, modern logistics, inspection, testing and certification shall be encouraged to retrofit and upgrade traditional industries. (The National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Commerce and the General Administration of Quality Supervision, Inspection and Quarantine shall be responsible according to the division of functions)
(5) Supporting foreign capital in participating in accordance with the laws and regulations by means of franchise in infrastructure construction, including energy, transport, water conservancy, environmental protection, and public utilities, among others. Relevant supporting policies shall be equally applicable to the construction and operation of foreign-funded franchise projects. (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, and the People's Bank of China shall be responsible according to the division of functions)
(6) Supporting Chinese-funded and foreign-funded enterprises and scientific research institutions in cooperating in research and development. Foreign-funded enterprises shall be supported in establishing research and development centers and enterprise technology centers and applying for the establishment of post-doctoral scientific research studios. Based on the reciprocity principle, foreign-funded enterprises shall be allowed to participate in undertaking national science and technology projects and programs. Incentive policies for weighted deduction of research and development expenses, new high technology enterprises and research and development centers, among others, shall be equally applicable to foreign-funded enterprises. (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 and the State Administration of Taxation shall be responsible according to the division of functions)
(7) Supporting the entrepreneurship and development of overseas high-level talents in China. High-level foreign national talents with permanent residence permits for foreigners who established science and technology enterprises shall be granted the same treatment as Chinese nationals. High-level foreign national talents and their spouses and children who apply for multiple-entry visas or residence permits shall be facilitated in accordance with the laws and regulations. (The Ministry of Science and Technology, the Ministry of Public Security, the Ministry of Human Resources and Social Security, and the State Administration of Foreign Experts Affairs shall be responsible according to the division of functions)
II. Further creating an environment of fair competition
(8) All departments shall develop policies for foreign investment, review fair competition under the Opinions of the State Council on Establishing a Fair Competition Review System in the Market System (No. 34 [2016], State Council), solicit opinions publicly in principle, and file important matters with the State Council for approval. All regions and all departments shall strictly implement the policies and regulations issued by the state and ensure the consistency in the implementation of the policies and regulations, and shall not increase restrictions on foreign-funded enterprises without permission. (The people‘s governments of all provinces, autonomous regions and municipalities directly under the Central Government and the departments under the State Council shall be responsible according to the division of functions)
(9) Unless otherwise expressly provided for by the laws and regulations, or save it is indeed necessary for foreign investors to provide information, relevant departments shall, according to the principle of unified standards and time limit for Chinese-funded and foreign-funded enterprises, review the applications for business licenses and qualifications filed by foreign-funded enterprises and promote same treatment to and fair competition among Chinese-funded and foreign-funded enterprises. (The people's governments of all provinces, autonomous regions and municipalities directly under the Central Government and the relevant departments under the State Council shall be responsible according to the division of functions)
(10) Promoting Chinese-funded and foreign-funded enterprises in equally participating in China‘s standardization. The reform of standardization shall be further deepened, and the transparency and openness of the revision of standards shall be improved. Public information disclosure in the whole process of the revision of standards shall be advanced, and the information sharing and social supervision in the process of the revision of standards shall be enhanced. (The Standardization Administration shall take the lead)
(11) Deepening the reform of government procurement, adhering to the principle of openness, transparency and fair competition, equally treating the products manufactured by foreign-funded enterprises in China in accordance with the laws and regulations, and promoting Chinese-funded and foreign-funded enterprises in equally participating in the bidding for government procurement. (The Ministry of Finance shall be take the lead)
(12) Strictly protecting the intellectual property rights of foreign-funded enterprises in accordance with the laws and regulations. The law enforcement mechanism of intellectual property rights shall be improved, and the law enforcement, rights protection assistance, arbitration and mediation of intellectual property rights shall be enhanced. The establishment of the foreign cooperation mechanism of intellectual property rights shall be strengthened and relevant international organizations shall be prompted to establish branch centers for the intellectual property arbitration and mediation in China. (The Ministry of Commerce, the State Administration for Industry and Commerce, the State Intellectual Property Office and the National Copyright Administration shall be responsible according to the division of functions)
(13) Supporting foreign-funded enterprises in expanding financing channels. Foreign-funded enterprises may be listed on the main board, small- and medium-sized enterprises board, and the secondary board market in accordance with the laws and regulations, quoted on the National Equities Exchange and Quotations System, issue corporate bonds, corporation bonds, convertible bonds raise funds, and raise funds by debt financing instruments of non-financial enterprises. (The National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China and the China Securities Regulatory Commission shall be responsible according to the division of functions)
(14) Deepening the reform of the registered capital system of foreign-funded enterprises. Unless otherwise specified by the laws and administrative regulations, the requirement for minimum registered capital of foreign-funded companies shall be canceled, and a unified registered capital system of Chinese-funded and foreign-funded enterprises shall be implemented. (The National Development and Reform Commission, the Ministry of Commerce, and the State Administration for Industry and Commerce shall be responsible according to the division of functions)
III. Further strengthening the attraction of foreign investment
(15) All regions shall vigorously promote investment according to the concept of innovative, coordinated, green, open and shared development, based on local actual circumstances. The local governments shall be allowed to develop and issue incentive policies for investment promotion within their statutory powers, projects contributing greatly to employment, economic development, and technology innovation shall be supported, the cost of enterprise investment and operation shall be reduced, and the rights and interests of foreign-funded enterprises and their investors shall be protected in accordance with the law, so as to create a good investment environment. (The people‘s governments of all provinces, autonomous regions and municipalities directly under the Central Government shall be responsible according to the division of functions)
(16) Supporting central, western and northeast China in taking over relocated industries. The Catalog of Priority Industries for Foreign Investment in Central and Western China shall be revised, and the scope of industries in central, western and northeast China in which foreign capital is encouraged to make investment shall be expanded. The enterprise income tax incentive policies shall be implemented for eligible foreign-funded enterprises in the industries in the category of encouragement in western China. Foreign-funded enterprises relocated to central, western and northeast China shall be entitled to funds, land and other incentive policies by which the state supports industry relocation and processing trade. In the case of foreign-funded enterprises relocated from east China to central, western and northeast China, the departments of human resources and social security shall, at application, handle the transfer of social security to different locations in a timely manner. (The National Development and Reform Commission and the Ministry of Commerce shall take the lead, and the Ministry of Industry and Information Technology, the Ministry of Finance, the Ministry of Human Resources and Social Security, the Ministry of Land and Resources and the State Administration of Taxation shall be responsible according to the division of functions)
(17) Supporting foreign-funded projects in using land. Relevant policies for the use of land shall be equally applicable to foreign-funded and Chinese-funded enterprises. Land shall be continuously provided in priority to a foreign-funded industrial project in the category of encouragement with the intensive use of land, and the base price for land assignment may be determined as per not lower than 70% of the minimum price set out in the National Standards for the Minimum Prices for Assignment of Land for Industrial Purposes corresponding to the land grade of the place where the project is located. (The Ministry of Land and Resources shall take the lead)
(18) Advancing the reform of the centralized operation and administration of the funds in Chinese and foreign currencies of foreign-funded transnational companies. Transnational companies shall be vigorously attracted to establish regional headquarters, procurement centers, settlement centers and other functional bodies in China, and foreign-funded transnational companies shall be allowed to centralize the operation of the funds in Chinese and foreign currencies, so as to promote the double-way flow of funds and improve funds utilization efficiency and investment facilitation. (The National Development and Reform Commission and the State Administration of Foreign Exchange shall be responsible according to the division of functions)
(19) Improving the foreign debt management system of foreign-funded enterprises. The administration of the foreign debt of Chinese-funded and foreign-funded enterprises shall be unified, the administration of the foreign exchange of enterprises shall be bettered, and the ability and facilitation of overseas fund raising by foreign-funded enterprises shall be improved. (The National Development and Reform Commission, the Ministry of Commerce, the People's Bank of China and the State Administration of Foreign Exchange shall be responsible according to the division of functions)
(20) Deepening the reform of the foreign investment administration system. The comprehensive implementation of the pre-access national treatment plus negative list management mode for foreign-funded enterprises shall be advanced, and the procedures for the administration of foreign-funded projects and of establishment and modification of foreign-funded enterprises shall be simplified. The integrated handling at the approval part shall be advanced, and the time for undergoing customs registration, application and purchase of invoices and other parts shall be shortened. The development of electronic government shall be enhanced, and one-stop acceptance, conclusion within a prescribed time limit and inquiry into progress shall be promoted, so as to improve the informatization of the administration of foreign investment. The construction of pilot free trade zones shall be advanced and experience shall be promoted and replicated in a larger scope. (The National Development and Reform Commission, the Ministry of Commerce, the General Administration of Customs, the State Administration of Taxation and the State Administration for Industry and Commerce shall be responsible according to the division of functions)
All regions and all departments shall recognize the significance of effective use of foreign capital under new conditions, attach great importance, take active actions, enhance responsibility and cooperate closely, and the National Development and Reform Commission and the Ministry of Commerce shall strengthen supervision and inspection in conjunction with relevant departments to ensure the implementation of all policies and measures. Based on the implementation of all policies and measures, a more open, facilitating and transparent business environment shall be vigorously created, foreign investment and advanced technology and management experience shall be vigorously attracted, the size and pace of foreign investment shall be stabilized, the level and quality of using foreign capital shall be raised or improved, and a new round of high-level opening up shall be promoted in priority, so as to promote reform and development with opening up.
State Council
January 12, 2017