III . Investment
i. Policy and Administrative Rules
Catalogue of Related Laws
Foreign Trade Law of the People's Republic of China Customs
Law of the People's Republic of China
Law of the People's Republic of China on Import and Export Commodity Inspection
Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures
Law of the People's Republic of China on Chinese-Foreign Contractual Joint Ventures
Law of the People's Republic of China on Foreign-Capital Enterprises
Company Law of the People's Republic of China
Law of the People's Republic of China on the Entry and Exit Animal and Plant Quarantine
Law of the People's Republic of China on Control of the Entry and Exit of Aliens
Law of the People's Republic of China on the Control of the Exit and Entry of Citizens
Securities Law of the People's Republic of China
Income Tax Law of the People's Republic of China for Enterprises with Foreign Investment and Foreign Enterprises
Individual Income Tax Law of the People's Republic of China
Law of the People's Republic of China on the Administration of Tax Collection
Environmental Protection Law of the People's Republic of China
Law of the People's Republic of China on Evaluation of Environmental Effects
Law of the People's Republic of China on Promotion of Cleaner Production
Law of the People's Republic of China on Prevention and Control of Desertification
Marine Environment Protection Law of the People's Republic of China
Law of the People's Republic of China on the Prevention and Control of Atmospheric Pollution
Law of the People's Republic of China on Prevention and Control of Environmental
Pollution by Solid Waste
Law of the People's Republic of China on Prevention and Control of Water Pollution
Law of the People's Republic of China on Prevention and Control of Environmental
Noise Pollution
Law of the People's Republic of China on Prevention and Control of Radioactive Pollution
Frontier Health and Quarantine Law of the People's Republic of China
Labor Law of the People's Republic of China
Trade Union Law of the People's Republic of China
Searching Website for the Related Laws
1 .Searching System of Laws and Regulations of China (website of National
People's Congress of China)
http://law.npc.gov.cn:87/home/begin1.cbs
2. China Legislative Information Network System
http://www.chinalaw.gov.cn/jsp/jalor/index.jsp
3. Ministry of Commerce
http://www.mofcom.gov.cn
The above-mentioned websites are for reference only.
ii. Catalog of Advantageous Industries of Sichuan Province for Foreign Investment
The development of follow-up industries of national key ecological projects such as returning the formerly cultivated land to forest and grassland and protecting naturally formed forests etc
Development and application of water saving irrigation technology
The intensive processing of rare earth and production of related applicable products
Construction of high yielding and high quality silkworm-eaten mulberry growing base and silk products processing
Ramie fabric and related goods production
Development and production of animal and plant recourses that can be used as medicine (excludes those which have been under the national protection)
Production and development of the downstream chemical products of natural gas
Production of electrician membrane
Construction and operation of natural gas, heat supply, water supply and drainage network in urban areas (controlled by Chinese side in large and middle-sized cities)
The development of scenic areas (spots) and construction, protection and operation of related supporting facilities
Highway passenger transportation
iii. Procedure for Enterprise Establishment & Required Documents
Note:
(1) Infrastructure projects shall be approved by development and reform commission, and technological transformation projects shall be approved by economic commission(commercial department).
According to the Catalogue for the Guidance of Foreign Investment Industries, any encouraged or permitted project with gross investment (including funds raised) of US$ 100 million and above, and any restricted project with gross investment of US$50 million and above shall be examined and verified by relevant provincial authorities according to laws and then shall be submitted to the State Development and Reform Commission for approval. Any encouraged or permitted project with gross investment which ranges from US$ 30 million (inclusive) to US$ 100 million, and any restricted project with gross investment below US$50 million shall be examined and verified by relevant provincial authorities. Any encouraged or permitted project with gross investment below US$ 30 million shall be examined and verified by relevant municipal (prefecture level) authorities. Chengdu municipal authorities are entitled to approve any encouraged or permitted project with gross investment below US$ 100 million.
(2) Project Confirmation Certificate issued by national or provincial tax reduction and exemption authorities shall be required for tax reduction and exemption of foreign invested enterprises.
(3) Besides certificate-issuing right for exploitation and mining of special mineral varieties such as petroleum, natural gas and radioactive minerals and certificate-issuing right for mining of tungsten, tin, magnesium, rare earth, which shall be subject to first level administration stipulated by laws and regulations, Sichuan Provincial Land and Resources Department also exerts right for approving, registering and issuing certificates for foreigner's investment, exploitation, mining of mineral resources in Sichuan province.
Required Documents for Establishment of Foreign-invested Enterprise
1. Documents to be submitted to Development and Reform Commission
A. Project name, business term, profile of investor;
B. Project construction scale, main construction contents and products, main technology and process, product target market, planned number of labor;
C. Address of project, demands on resources including land, fresh water, energy, etc., consumption volume of main raw materials;
D. Price of public products or service;
E. Gross investment of project, registered capital, and amount contributed by each party, contributing mode and financing scheme, equipment to be imported, amount of equipment.
Documents listed below shall be also attached:
A. Certificate of Incorporation (Business License) of Chinese and foreign investors, Business Registration Certificate and the latest financial statements(including balance sheet, profit and loss statement and cash flow statement), credit certificate issued by the deposit bank;
B. Investment intention; projects of capital Increase and acquisition and merger resolution of
Board of directors of the company with projects of capital Increase and acquisition & merger;
C. Financing intention issued by bank;
D. Environmental Impact Report issued by national or provincial environmental protection departments;
E. Planning for Land Use issued by national or provincial land and resources departments;
F. Confirmation documents issued by competent authorities for projects to be invested in form of the state-owned assets or land use right.
(2) Documents to be submitted to business departments
1) Sino-Foreign Equity Joint Venture, Sino-foreign Cooperative Joint Ventures
A. Application for establishment of joint venture;
B. Feasibility Study Report; Approval from Provincial Development and Reform
Commission or Economic Commission;
C. Contract, articles of association (signed by legal representatives of Chinese and foreign investors or authorized persons of the legal representatives);
D. Appointment letter of directors signed by legal representatives of investors;
E. Chinese and foreign investors shall submit business license, incorporation certificate, credit certificate, valid evidences of legal representative.
Documents listed below shall be also attached:
A. Notice for registration approval of enterprise name issued by administration for industry and commerce;
B. A list for equipment to be imported shall be provided (including equipment name, specification, quantity and price), if required;
C. If the state-held enterprises make investment by using the fixed assets, assets evaluation report is required;
D. If any of the above documents is to be signed by the authorized person, an authorization letter (original) of legal representative of investor shall be provided.
2) Foreign-invested enterprises
A. Application concerning establishment of foreign-invested enterprise (signed by legal representative of investor or authorized person);
B. Application concerning establishment of foreign-invested enterprises in China (signed by legal representative of investor or authorized person);
C. Articles of association of foreign invested enterprise (signed by legal representative of investor or authorized person);
D. Legal evidences and credit certificate of investor (bank certificate, deposit certificate or bank statement, or audited report for fiscal year from accountant, or title deed of house property, or renewed business license of Taiwan enterprises. No credit certificate is required for direct investment by any world famous enterprise).
Documents listed below shall be also attached:
A. Notice for registration approval of enterprise's name issued by administration of industry and commerce;
B. Director authorization letter signed by each investor if board of directors is required to be established;
C. ID certification of legal representative of investor (e.g. Passport, ID card, etc.);
D. A list for equipment to be imported shall be provided (including equipment name, specification, quantity and price), if required;
E. Two or more foreign investors who will jointly establish foreign-invested enterprise shall provide duplicate of the signed contract for review;
F. If any of the above documents is to be signed by authorized person, authorization letter (original) of legal representative of investor shall be provided.
(3) Documents required by authority of industry and commerce
A. Application for Establishment and Registration of Foreign-invested Enterprise;
B. Approval documents issued by approval authority (one duplicate of reply and approval certificate); joint-stock company limited established in fund-raising manner shall submit approval documents of securities administration departments of the state council;
C. Approval documents for relevant project proposal or feasibility study report;
D .Contracts (not required for exclusively foreign-owned enterprise) and articles of association;
E. Name pre-approval Notice of foreign-invested enterprise;
F. Legal business-opening certificate and credit certificate of investor;
G. Original of appointment document of legal representative/director/supervisor; duplicated copies of ID cards;
H. Registration/Record Form for Property Right of state-owned assets(only
applicable for state-owned enterprises);
I. Certificate for use of dwelling house;
J. Cahier of establishment meeting, agreement of sponsor, financial audit report for establishing the company (only applicable for joint-stock company limited);
K. Capital verification certificate issued by competent capital verification institution (applicable for joint-stock company limited and financial institutions);
L. Project priority examination and approval documents or certificates, if applicable;
M. Other related documents or certificates.
Foreign Exchange Registration
Applying for foreign exchange registration of foreign-invested enterprises Before doing this at the Administration of Foreign Exchange, foreign-invested enterprises should beforehand get permission from authority of commerce and Approval Certificate of Foreign-invested Enterprises and acquire Business License from administrative authority of industry and commerce.
After this is done at the Administration of Foreign Exchange, enterprises will obtain Certificate of Foreign Currency of Foreign invested Enterprises.
This certificate shall be shown when the enterprises doing foreign exchange transaction in the Administration of Foreign Currency or banks.
Application Materials
(1) Basic Information Form of Foreign invested Enterprises marked by seal of applying company and Certificate of Foreign Currency Registration for Foreign-invested Enterprises.
(2) The duplicate of business license of legal person of enterprise, non-legal person Sino-foreign contractual joint venture should provide business license (the original or a copy marked with original seal; copy retained)
(3) Permissive files and originals of certifi cates issued by commercial authority.
(4) Permissive files and originals of joint venture or cooperation agreement and constitutions (originals or duplicate copy with original seals shall be checked and the duplicate copy shall be kept for records)
(5) Organization Code Certificate issued by State Quality and Technology Supervision Bureau.
(6) When re-applying for Certificate of Foreign Currency Registration for Foreign invested Enterprises, an enterprise should publish a loss claim on a national scale newspaper.
Note: Other information can be gained from local foreign currency administrative bodies.
Regulations for employment
In accordance with Labor Law of the People's Republic of China and Regulations of the People's Republic of China on Labor Management in Foreign-invested Enterprise, foreign-invested enterprise may decide setup of frame organizations and personnel recruitment at its discretion according to production and operation. Employee must be over 16 years old; and employee engaged in toxic or harmful work or extremely heavy manual work must be over 18 years old. Any foreigner working in China must hold employment certificate and employment permit certificate.
iv. Residence Environment
Rules of Exit and Entrance
When a foreigner is going to enter into Chinese territory, he or she should apply for a visa to Chinese diplomatic representative bodies or other bodies authorized by Ministry of Foreign Affairs of China. Under special circumstances, a foreigner can according to rules set up by State Council apply for a visa to a visa authority at a port designated by Chinese government.
When a foreigner is going to leave the country, he/she shall be holding his/her valid passport or other valid certificates.
Work and Residence Permit
A foreigner has to acquire an ID certificate or residence certificate issued by Chinese government. The tenure of these certificates depends on reasons of entrance.
Foreigners resident in China should have their certificates checked at local public security bureaus on a regulated date. Foreigners who are in need of long-term stay in China for reasons of joint venture, or technological, cultural and economic cooperation with Chinese enterprises, can acquire long-term or permanent residence permit approved by Chinese authority. Foreign students in China, and foreigners resident in China without a residence certificate cannot be allowed to seek employment unless approved so by Chinese authority.
Foreigners who have visa or residence permit can travel in areas open to them under Chinese regulations. Under condition that they want to go to areas not so opened, they should apply for travel certificates at local public security bureaus.
Environment for Urban Life
Sichuan has good environment for residence, by the end of 2005, urbanization rate was up to 33%, percentage of forest cover was up to 28.98%,percentage of cities with over 3-level air quality was 86.9%, up-to-standard ratio of 73 water quality items of five big rivers was 71.2%.
Urban sewage and rubbish treatment ability has been increased, sewage treatment ratio was up to 32%; innocuous treatment ratio of urban solid waste was up to 38%.
Medical Care
There are 1,144 hospitals in Sichuan, 123,995 ward beds, and 142,017 medical care personnel. Public hygiene system including disease prevention center is built up perfectly, state-of-art technologies are available in many fields such as specialty of ophthalmology, E.N.T. department, oral cavity, and cardiovascular diseases.
Driving License
Those holding non-Chinese driving license can be provided with a Chinese motor driving license on condition that they fit for driving qualifications set up by public security authority of State Council, and they pass an according driving examination. When applying for a driving license, foreigners should fill in Application Form of Motor Driving License and present following certificates: (1)ID certification of the applicant; (2) Physical condition certifi cation issued by county-level and above medical authorities; (3)present motor driving license. A Chinese translation version is needed if the license is not written in Chinese.
v. Reference Prices of Basic Elements
Related Articles:
Doing Business in Sichuan Province of China:I. Survey
Doing Business in Sichuan Province of China:II. Economy
Doing Business in Sichuan Province of China:IV. Development Zones
