MOFCOM Announcement No.12 of 2015 Administrative Measures for the Record-filing of Foreign Investment in Pilot Free Trade Zones (for Trial Implementation)

MOFCOM Announcement No.12 of 2015 Administrative Measures for the Record-filing of Foreign Investment in Pilot Free Trade Zones (for Trial Implementation)
April 10, 2015

In order to further open up to the outside world, promote the reform of foreign investment management system, and create an international, legal and market-oriented business environment in the pilot free trade zones (hereinafter referred to as the "Pilot Free Trade Zone"), upon the authorization of the Standing Committee of the National People's Congress, the State Council has decided to put the foreign investment under the management mode of pre-access national treatment plus the negative list in the Pilot Free Trade Zone. In order to implement the relevant requirements for reforming the foreign investment management model and regulate the record-filing management of foreign investment in the Pilot Free Trade Zone, the Administrative Measures for the Record-filing of Foreign Investment in Pilot Free Trade Zones (for Trial Implementation) are hereby promulgated for implementation after 30 days as of the date of promulgation.

Ministry of Commerce of the People’s Republic of China

                                                                                                                                        April 8, 2015

Administrative Measures for the Record-filing of Foreign Investment in Pilot Free Trade Zones (for Trial Implementation)

Article 1: In order to further open up to the outside world, promote the reform of foreign investment management system, and create an international, legal and market-oriented business environment in China (Guangdong) Pilot Free Trade Zone, China (Tianjin) Pilot Free Trade Zone, China (Fujian) Pilot Free Trade Zone, and China (Shanghai) Pilot Free Trade Zone (hereinafter referred to as the "Pilot Free Trade Zone"), the Administrative Measures for the Record-filing of Foreign Investment in Pilot Free Trade Zones (for Trial Implementation) (hereinafter referred to as the "Measures") are formulated in accordance with the Decision of the Standing Committee of the National People's Congress on Authorizing the State Council to Temporarily Adjust the Administrative Examination and Approval of Relevant Laws in China (Shanghai) Pilot Free Trade Zone, the Decision of the Standing Committee of the National People's Congress on Authorizing the State Council to Temporarily Adjust the Administrative Examination and Approval of Relevant Laws in the China (Guangdong) Pilot Free Trade Zone, the China (Tianjin) Pilot Free Trade Zone, the China (Fujian) Pilot Free Trade Zone and the Expanded Area of China (Shanghai) Pilot Free Trade Zone, other relevant laws, administrative regulations and the decision of the State Council.

Article 2: The investment in the fields other than those mentioned in the Special Administrative Measures (Negative List) for Foreign Investment Access to Pilot Free Trade Zones made by foreign investors in the Pilot Free Trade Zone, the incorporation, alteration and filing of contracts and articles of association of foreign-funded enterprises (hereinafter collectively referred to as the "Investment Implementation") shall be governed by the Measures, or the provisions otherwise specified by the laws, administrative regulations and the decision of the State Council.

The Investment implementation time, for the establishment of foreign-funded enterprises, refers to the time of issuance of business license; for the alteration of foreign-funded enterprises, in case of the renewal of business license, the investment implementation time shall refer to the time of renewal of business license; in case that the renewal of business license is not involved, the investment implementation time shall refer to the time of occurrence of the alteration.

Article 3: Pilot free trade zone management institutions (hereinafter referred to as the "Record-filing Institutions") shall be responsible for the filing management of foreign investment in the Pilot Free Trade Zone.

The Record-filing Institutions shall carry out the filing of foreign investment matters in the Pilot Free Trade Zone through the filing information system for foreign (Hong Kong, Macau, Taiwan and overseas Chinese) investment (hereinafter referred to as the "Record-filing System") of the Ministry of Commerce.

Article 4 If the enterprise set up by a foreign investor in the Pilot Free Trade Zone needs to be filed pursuant to the Measures, the foreign investor may, before the Investment Implementation or within 30 days as of the Investment Implementation, after the receipt of the notice on the pre-approval of enterprise name, log on the pilot free trade zone platform for acceptance (hereinafter referred to as the "Acceptance Platform") to fill in and submit the Declaration Form for Incorporation of Foreign-funded Enterprise in the Pilot Free Trade Zone (hereinafter referred to as the "Incorporation Declaration Form") on line.

Article 5 As for the foreign-funded enterprise that shall be filed pursuant to the Measures, the Declaration Form for Alteration of Foreign-funded Enterprise in the Pilot Free Trade Zone (hereinafter referred to as the "Alteration Declaration Form") shall be filled in and submitted on line to go through the filing formalities for alteration, prior to the Investment Implementation or within 30 days as of the Investment Implementation, in case of the following alteration:

1. the change of the total investment;
2. the change of the registered capital;
3. the change or transfer of the equity or cooperation interests;
4. the equity pledge;
5. the merger or division;
6. the alteration of business scope;
7. the change of the operating period;
8. the early termination;
9. thealteration of contribution form or contribution period;
10. the advance recovery of investment by the foreign partner of the Sino-foreign cooperative enterprise;
11. thealteration of company name; and
12. the change of the registered address.
Specifically, as for those that shall be announced in accordance with the relevant laws and regulations, the foreign-funded enterprise shall state the information on the handling of announcement formalities according to the law in going through the filing formalities for alteration.

Article 6: The foreign-funded enterprise under the filing management shall go through the formalities for examination and approval in accordance with the relevant provisions on foreign investment management as to the alteration of the enterprise that shall be subject to the examination and approval.

Article 7: If the foreign-funded enterprise incorporated in the Pilot Free Trade Zone prior to the implementation hereof alters any of the registered items, or the foreign-funded enterprise outside the Pilot Free Trade Zone moves in, and the alteration or move shall be recorded pursuant to the Measures, the said foreign-funded enterprise shall go through the filing formalities for alteration, and handle in the Certificate of Approval for Foreign-Funded Enterprises (Hong Kong, Macau, Taiwan and Overseas Chinese Investors) for cancellation.

Article 8: Foreign investors or foreign-funded enterprises shall, in submitting the Incorporation Declaration Form or the Alteration Declaration Form, undertake that the contents declared by them are true, complete and effective and that the investment matters they declare are in compliance with the provisions of the relevant laws and regulations.

Article 9: After the submission of the Incorporation Declaration Form or the Alteration Declaration Form by foreign investors or foreign-funded enterprises on line, the Record-filing Institutions shall screen the matters declared for record-filing. The Record-filing Institutions shall complete the filing within three working days if such matters shall be recorded pursuant to the Measures and inform the foreign investors or foreign-funded enterprises thereof. As for those matters that do not need to be recorded pursuant to the Measures, the Record-filing Institutions shall inform the foreign investors or foreign-funded enterprises of going through the examination and approval formalities in accordance with relevant provisions.

Article 10: The Record-filing Institutions shall promptly publish the filing result on the Record-filing System, and share the information on filing result with the Acceptance Platform.

Article 11: After the receipt of the notice on the completion of filing, the foreign investor or foreign-funded enterprise may receive the Filing Certificate of Foreign-funded Enterprises (hereinafter referred to as the "Filing Certificate") from the Record-filing Institution. The following documents are necessary for the receipt:
1. the notice on the Pre-approval of company name (photocopy);
2. the Incorporation Declaration Form signed and sealed by the foreign investor or his or her authorized representative, or the Alteration Declaration Form signed and sealed by the foreign-funded enterprise or its authorized representative; and
3. the subject qualification certificate or identity certificate of the foreign investor or the actual controller (photocopy).

Article 12: The foreign-funded enterprises in the Pilot Free Trade Zone shall log on the Record-filing System no later than June 30 each year to fill in and submit the Annual Report Form for the Investment and Operation of Foreign-funded Enterprises.

Article 13: The Record-filing Institutions shall carry out the supervision and inspection to see that whether the foreign investors and foreign-funded enterprises in the Pilot Free Trade Zone comply with the laws and regulations on foreign investment.

The Record-filing Institutions may adopt the methods such as regular spot checks, checks according to reports, a check based on the recommendation and feedback of the relevant departments or the judiciary organs, initiation of check according to legal powers and so on to carry out the supervision and inspection.

Article 14: The contents of supervision and inspection carried out by the Record-filing Institutions include: whether the foreign investors or foreign-funded enterprises perform the filing procedures pursuant to the provisions herein; whether the investing and operating activities by foreign-funded enterprises are in line with those they fill in for filing; whether the annual report is filled in pursuant to the provisions herein; and whether there is any violation of provisions of laws and regulations on the foreign investment.

Article 15: In the event that any foreign investor or foreign-funded enterprise is found out to be in violation of the laws and regulations on the foreign investment in the supervision and inspection, the Record-filing Institution shall send a written notice to the violator, instructing the violator to make explanation and carry out the investigation according to the law. If the violation does exist as confirmed through the investigation, the violator shall be ordered to make correction within a prescribed time limit; in case of gross violation, the Record-filing Institution shall cancel the filing and submit the application to the relevant department for punishment on the violator according to the law.

Article 16: The information arising from the filing, registration and investing and operating activities of the foreign investors or foreign-funded enterprises, together with the information on their credit as known by the Record-filing Institutions and other competent departments in the supervision and inspection, will be included in the credit file system for foreign (Hong Kong, Macau, Taiwan and overseas Chinese) investment of the Ministry of Commerce.

The Ministry of Commerce and the relevant departments will share the information on the credit of foreign investors and foreign-funded enterprises. If the record-filing information is not real, or the annual report fails to be filled in in accordance with the provisions hereof, the Record-filing Institutions shall record the relevant information into the credit file and take appropriate ways to publicize such information.

The credit information shared and publicized shall not contain any business secret or personal privacy of foreign investors and foreign-funded enterprises.

Article 17: The foreign investment in the Pilot Free Trade Zone involving the national security review or anti-monopoly review shall be dealt with according to the relevant provisions.

Article 18: The investment companies and venture capital enterprises funded by foreign investors that invest in the Pilot Free Trade Zone shall be deemed as the foreign investors and governed by the Measures.

The foreign merger or acquisition, strategic investment by foreign investors in the listed company, contribution by foreign investors with the equities of domestic enterprises in China held by them, and re-investment by foreign-funded enterprises in China shall comply with the requirements of relevant provisions.

Article 19 The Measures shall apply mutatis mutandis to the investment in the fields other than those mentioned in the Special Administrative Measures (Negative List) for Foreign Investment Access to Pilot Free Trade Zones made by investors from Hong Kong Special Administrative Region, Macau Special Administrative Region and Taiwan in the Pilot Free Trade Zone.

Article 20 The Measures shall come into force after 30 days as of the date of promulgation.

Annexes:
1.Declaration Form for Incorporation of Foreign-funded Enterprise in the Pilot Free Trade Zone.doc
2.Declaration Form for Alteration of Foreign-funded Enterprise in the Pilot Free Trade Zone.doc
3. Filing Certificate of Foreign-funded Enterprises in China ( ) Pilot Free Trade Zone.doc

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