People’s Governments of Provinces, Autonomous Regions and Centrally Administered Municipalities, Ministries, Commissions and Directly Affiliated Institutions under the State Council: 

The utilization of foreign investment accounts for a pivotal component of China’s basic state policy of opening up and system of open economy. It plays a positive role in the economic development and the deepening reform. Today, across the globe, cross-border investment and industry transfer have displayed new trends. The Chinese economy has fundamentally assimilated into the global economy and ushered in an era of new normal. The utilization of foreign investment is faced with new circumstances and new challenges. In order to implement to a fuller extent Opinions of CPC Central Committee and State Council on the Building of New System of Open Economy, advance the utilization of foreign investment, create a competitive business climate, forward the reforms aimed to streamline administration, delegate power to lower levels, synergize power delegation with tightened oversight and optimize governmental service, reduce the institutional transaction costs and achieve mutual benefit and shared prosperity, the relevant matters are hereby notified as follows:            

I. Further broadening of opening to the outside world

1. A new round of opening should be advanced to a fuller extent, guided by the principle of open development. Catalogue of Industries for Guiding Foreign Investment, relevant policies and regulations should be revised to ease access restrictions for foreign investors in the areas of services, manufacture, mining, etc. The foreign-funded businesses are advocated to take part in the implementation of the innovation-driven development strategy, the upgrade and transformation of the manufacturing sector and the business ventures of overseas talents in China. (Coordinated by National Development and Reform Commission and Ministry of Commerce)  

2. The service sector should be opened wider to foreign investors. As a prior undertaking, the access restrictions to banking institutions, companies dealing with securities, futures and security investment fund management, insurance institutes and insurance intermediaries should be eased, the access restrictions to accounting, auditing, architecture design, rating service, etc. should be removed, and the opening of telecommunication, the Internet, culture, education, transport, etc. should be promoted in an orderly manner. (Coordinated by National Development and Reform Commission and Ministry of Commerce, responsibilities to be taken by Ministry of Education, Ministry of Industry and Information Technology, Ministry of Finance, Ministry of Human Resources and Social Security, Ministry of Housing and Urban-Rural Development, Ministry of Transport, Ministry of Culture, People’s Bank of China, State Administration of Press, Publication, Radio, Film and Television, Cyberspace Administration, China Banking Regulatory Commission, China Securities Regulatory Commission, China Insurance Regulatory Commission and other relevant authorities within their respective purviews)

3. In the manufacturing sector, the restrictions on access for foreign investors should be removed in the areas of rail transport equipment, motorcycles, ethanol fuel and oil. In the mining sector, the restrictions on access for foreign investors should be eased in the areas of mines and nonregular oil, including oil shale, oild sand and shale gas. The review and approval mechanism pertaining to foreign-related oil and natural gas cooperation should be replaced with a registration system. (Coordinated by National Development and Reform Commission and Ministry of Commerce, responsibilities to be taken by Ministry of Industry and Information Technology, Ministry of Land and Resources, State Administration of Grain, National Energy Administration and other relevant authorities within their respective purviews)

4. The domestic- and foreign-funded enterprises are equally eligible for the policies and measures pertaining to the “Made in China 2025” initiative. The foreign businesses are encouraged to invest in advanced manufacture, intelligent manufacture, green manufacture and the like, and the producer services including industrial design and innovation, industrial consultancy, modern logistics, inspection, examination and certification, in view of remodeling and empowering the conventional industries. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Commerce, General Administration of Quality Supervision, Inspection and Quarantine and other relevant authorities within their respective purviews)

5. Foreign investors are advocated, in compliance with relevant laws and regulations, to take part in infrastructure development by means of franchise, covering the segments of energy, transport, water resources, environmental protection, public facilities, etc. Relevant support policies should apply in equal measure to the development and operation of franchised projects funded by foreign investors. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Finance, Ministry of Housing and Urban-Rural Development, Ministry of Transport, Ministry of Water Resources, People’s Bank of China and other relevant authorities within their respective purviews)

6. The enterprises incorporated domestically and overseas and the research institutes are advocated to cooperate in research and development initiatives. The foreign-funded enterprises are advocated to launch research and development centers and corporate technology centers, as well as apply for the establishment of postdoctoral work stations. On the principle of reciprocity, the foreign-funded enterprises are allowed to take part in the national technology programs. The foreign-funded enterprises should be entitled in equal measure to the favorable policies of research and development expenses super deduction, high and new technology enterprises, research and development centers, etc. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Science and Technology, Ministry of Finance, Ministry of Human Resources and Social Security, Ministry of Commerce, State Administration of Taxation and other relevant authorities within their respective purviews) 

7. High level talents from abroad are advocated to start business in China. A high level talent of foreign nationality with a foreigner’s permanent residence identity card should receive the same treatment as a Chinese national in technology-oriented business ventures. A high level talent of foreign nationality, his/her marital partner of foreign nationality and children should be granted facilities in the application for multiple entry visas or residence papers, as per relevant laws and regulations. (Responsibilities to be taken by Ministry of Science and Technology, Ministry of Public Security, Ministry of Human Resources and Social Security, State Administration of Foreign Experts Affairs and other relevant authorities within their respective purviews)

II. Greater efforts on shaping a business climate of fair competition 

8. The design of any policy on foreign investment by the competent authorities should undergo the fair competition review as per Opinions of State Council on the Institutionalization of Fair Competition Review in Market System Development (Guofa [2016] No. 34) and as a general rule, solicit opinions from the public, while key issues thereof are submitted to the State Council for approval. All the localities and authorities should closely observe state policies and regulations, so as to ensure consistent enforcement. They are prohibited from introducing arbitrary limits on foreign-funded enterprises. (Responsibilities to be taken by the People’s Governments of Provinces, Autonomous Regions and Centrally Administered Municipalities and the authorities under the State Council within their respective purviews)

9. In the view of promoting equal treatment of and fair competition between domestic- and foreign-funded enterprises, the competent authorities should verify the application for business licenses and certificates by foreign-funded enterprises on the principle of uniform standards and uniform timeframes for domestic- and foreign-funded enterprises, unless the supply of additional information by foreign investors is explicitly stipulated by laws and regulations or necessiated by circumstances. (Responsibilities to be taken by the People’s Governments of Provinces, Autonomous Regions and Centrally Administered Municipalities and the authorities under the State Council within their respective purviews)

10. Efforts should be made to promote the fair participation of the domestic- and foreign-funded enterprises in China’s standardization undertaking. The reform on the standardization undertaking should be deepened, with a view to increasing the transparency and openness in standard compilation and modification. Efforts should be made towards the public release of the information regarding the full cycle of standard compilation and modification. Information sharing and societal supervision should be strengthened through the compilation and modification of the standards. (Coordinated by Standardization Administration)

11. The reform on government procurement should be deepened. With adherence to the principle of openness, transparency and fair competition, the products produced by foreign-funded enterprises within China should receive nondiscriminatory and equal treatment as per relevant laws and regulations. Efforts should be made towards the fair participation of the domestic- and foreign-funded enterprises in government bids. (Coordinated by Ministry of Finance)

12. The intellectual property rights of the foreign-funded enterprises should be entitled to rigid safeguard as per relevant laws and regulations. The enforcement mechanism pertaining to the intellectual property rights should be consolidated. The work on enforcement of intellectual property rights, assistance in legal rights proection, arbitration and mediation should be strengthened. Initiatives should be set in motion to encourage relevant intentional bodies to establish in China sub-centers of arbitration and mediation on intellectual property rights. (Responsibilities to be taken by Ministry of Commerce, State Administration for Industry and Commerce, State Intellectual Property Office, National Copyright Administration and other relevant authorities within their respective purviews)

13. The foreign-funded enterprises are advocated to enrich the means of financing. The foreign-funded enterprises may raise funds by means of going public in the Main Board, the Second Board and the Growth Enterprise Board, listing in the New OTC Board, issuing enterprise bonds, corporate bonds and convertible bonds, and leveraging debt instruments available to non-financial enterprises. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Commerce, People’s Bank of China, China Securities Regulatory Commission and other relevant authorities within their respective purviews)

14. The institutional reform on the registered capital by foreign-funded enterprises should be deepened. In view of implementing a uniform capital registration system for domestic- and foreign-funded enterprises, the minimum requirement on the registered capital by foreign-funded enterprises should be removed, unless otherwise stipulated by relevant laws and regulations. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Commerce, State Administration for Industry and Commerce and other relevant authorities within their respective purviews) 

III. Further strengthening of the work on foreign investment attraction

15. All the localities should make proactive and tailored efforts on investment promotion, following the development concepts of innovation, coordination, green development, opening up and sharing. The local governments are allowed, under their jurisdiction, to introduce favorable policies on investment attraction. Support should be granted to the projects substantially conducive to job creation, economic development and technology innovation. The costs of investment and operation for the enterprises should be reduced. The rights and interests of the foreign-funded enterprises should be safeguarded by law. A friendly investment climate should be put in place. (Responsibilities to be taken by the People’s Governments of Provinces, Autonomous Regions and Centrally Administered Municipalities and the authorities under the State Council within their respective purviews)

16. The central, western and northeastern regions are advocated to accommodate the relocation of foreign-funded businesses. Catalogue of Industries for Guiding Foreign Investment in Central and Western Regions should be revised with a view to enlarging the coverage of industries in central, western and northeastern regions wherein foreign investment is encouraged. The qualified foreign-funded enterprises belonging to the encouraged industries of the western regions should be eligible for corporate income tax incentives. The foreign-funded enterprises relocated to central, western and northeastern regions should be entitled to the favorable policies pertaining to industry relocation and processing trade, in terms of financial support, land use, etc. With regards to the foreign-funded enterprises relocated from eastern regions to central, western and northeastern regions, the human resources and social security authorities should deal with the transfer and extension of social security for the individuals thus affected in a timely manner, upon the application of the latter. (Coordinated by National Development and Reform Commission and Ministry of Commerce, responsibilities to be taken by Ministry of Industry and Information Technology, Ministry of Finance, Ministry of Human Resources and Social Security, Ministry of Land and Resources, State Administration of Taxation and other relevant authorities within their respective purviews) 

17. The land use by the foreign-funded projects should be supported. Relevant land policies should apply to domestic- and foreign-funded enterprises in equal measure. The priority supply of land to foreign-funded industrial projects that use land in an intensive manner should be continued. The transfer of the land usage rights pertaining to the abovementioned projects should, in compliance with the national land rating, start with 70% of the minimum price of the industrial lands. (Coordinated by Ministry of Land and Resources)

18. Efforts should be made to forward the reform on the administration of foreign multinationals’ centralized operations of RMB and foreign currency funds. Proactive efforts should be made to attract multinationals to set up regional headquarters, procurement centers, settlement centers and other functional bodies in China. The foreign multinationals should be allowed to conduct centralized operations of RMB and foreign currency funds, in view of boosting bidirectional capital flows, fostering greater efficiency in fund use and furthering investment facilitation. (Responsibilities to be taken by People’s Bank of China, State Administration of Foreign Exchange and other relevant authorities within their respective purviews) 

19. The foreign debt administration concerning the foreign-funded enterprises should be consolidated. The domestic- and foreign-funded enterprises should be encompassed by a uniform mechanism of foreign debt administration. The foreign exchange administration concerning the enterprises should be improved. The foreign-funded enterprises should be granted more instruments and greater facilities of raising funds abroad. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Commerce, People’s Bank of China, State Administration of Foreign Exchange and other relevant authorities within their respective purviews)

20. The institutional reform on foreign investment administration should be deepened. Progress should be made in the full implementation of pre-entry national treatment and negative list. The procedures concerning the management of foreign-funded projects and the establishment and alteration of foreign-funded enterprises should be simplified. Progress should be made in the parallel processing of review and approval procedures. The timeframes for customs registration, invoice application, etc. should be shortened. Greater efforts should be made on the development of electronic government. The application of information technology in foreign investment administration should be advanced to a fuller extent, by introducing the practices of single window acceptance, compulsory deadline and traceable progress. The development of pilot free trade zones should be further cultivated and the successful experience thereof should be duplicated on a broader scale. (Responsibilities to be taken by National Development and Reform Commission, Ministry of Commerce, General Administration of Customs, State Administration of Taxation, State Administration for Industry and Commerce and other relevant authorities within their respective purviews)

All the localities and authorities should build up sharp awareness of the vitality of foreign investment utilization under new circumstances. They should pay high attention, take the initiative, strengthen the responsibilities and work in close association in this undertaking. National Development and Reform Commission and Ministry of Commerce should work in concert with relevant authorities to enhance supervision and inspection, so as to ensure the full implementation of all the policies and measures in this regard. With these policies and measures in place, a more open, friendly and transparent business climate should be hammered into shape. Efforts should be made to proactively attract foreign investment, advanced technology and sophisticated management expertise, stabilize the scale and pace of foreign investment, improve the cultivation and performance of foreign investment utilization, advance the extent of opening to a higher order of magnititude and take full advantage of opening to promote the cause of reform and development.            

State Council

January 12, 2017