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The State Administration for Industry and Commerce
Reply of the Department of Enterprise Registration of the State Administration for Industry and Commerce Concerning the Interpretation
of Article 5 of the Interim Provisions of the State Administration for Industry and Commerce on the Proportion of the Registered
Capital and the Total Investment Amount of Chinese-foreign Equity Joint Ventures
GongShangQiWaiZi [1987] No.54
September 17, 1987
Commission of Foreign Economic Relations and Trade of Tianjin:
Your Letter Requesting for Instructions on the Interpretation of Article 5 of the Interim Provisions of the State Administration
for Industry and Commerce on the Proportion of the Registered Capital and the Total Investment Amount of Chinese-foreign Equity Joint
Ventures has been transferred here by the Bureau of Foreign Investment of the Ministry of Foreign Economic Relations and Trade.
We hereby give the interpretation of Article 5 of the Interim Provisions of the State Administration for Industry and Commerce on
the Proportion of the Registered Capital and the Total Investment Amount of Chinese-foreign Equity Joint Ventures (hereinafter referred
to as the Interim Provisions) as follows:
Chinese-foreign equity joint ventures that increase their investment upon approval and registration, the supplementary registered
capital should be calculated in relation to the increased investment and the proportion should be determined in accordance with Article
3 of the Interim Provisions. For example, the approved registered investment of a project is 5 million US dollars, the registered
capital 2.5 million US dollars, and then an increased investment worth 2 million US dollars is approved; in that case, the supplementary
registered capital should be 7/10 of the 2 million or 1.4 million and the total registered capital after altered registration should
be 3.9 million US dollars (i.e. 1.4 million plus 2.5 million).
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