Decree No 3, 1996 Ministry of Foreign Trade and Economic Co-operation of the People’s Republic of China Minister Wu Yi (September 30, 1996) The Provisional Measures on the Establishment of Sino-Foreign Joint-Venture Trading Companies on a Pilot Basis are hereby enacted,
Article 1 With a view to further expanding opening up to the outside world and promoting the development of China’s foreign trade, these Measures Article 2 These measures shall be applicable to Sine-foreign joint-venture trading companies (hereinafter referred to as “joint-venture trading Article 3 A joint-venture trading company shall be a company of limited liabilities. The shares of the Chinese company in the registered capital Article 4 The establishment of a joint-venture trading company shall satisfy the following conditions upon its establishment: 1 The foreign company shall (1) enjoy a turnover of over US$5 billion in the year prior to the application; (2) enjoy an average annual trading volume of over US30 million with China in the three years prior to the application; (3) have established a representative office within the territory of China for more than three years or have made an investment of 2 The Chinese company shall (1) enjoy foreign trade rights; (2) enjoy an average annual foreign trade volume of over US$200 million, among which the export volume shall be no less than US$100 (3) have established more than three branches, subsidiaries and joint ventures outside China, each with an average annual turnover 3 A joint-venture trading company shall (l)have a registered capital of no less than 100 million yuan; (2) have its own name and organization; (3) have its own operational venue, professionals and other necessary physical conditions compatible with its foreign trade operations. Article 5 In applying for the establishment of a joint-venture trading company, the Chinese company shall submit through the local department 1 A project proposal a feasibility study report signed by both the Chinese and foreign parties, the relevant contract and articles 2 (Copies of ) Documents certifying the registrations of all Chinese and foreign parties, and documents certifying the credit worthiness 3 (Conies of) Certificates of approval of the enterprises invested by the foreign company in China or (copies of) certificates of 4 (Copies of) Certificates of the registration of the branches, subsidiaries and joint ventures established by the Chinese company 5 Balance sheets of all Chinese and foreign parties in the recent three-years and certificates of confirmation issued by auditing 6 Business scope of the proposed joint-venture trading company; and 7 Other documents required by the competent State authorities responsible for foreign trade and economic cooperation An approving certificate shall be issued by national authorities responsible for foreign trade and economic co-operation to a joint-venture Article 6 Once an application for the establishment of a joint-venture trading company is approved by the State, the Chinese company shall Article 7 The foreign company shall make its contribution to the registered capital of the joint-venture trading company freely convertible Article 8 A joint venture trading company shall undertake import and export of goods and technology either for for itself or on proxy within Article 9 A joint venture trading company which imports and exports commodities subject to State quota and licensing control shall file an Article 10 A joint-venture trading company shall settle, purchase and transfer foreign exchange according to relevant provisions applicable Article 11 A joint-venture trading company shall pay taxes according to the State’s taxation laws and regulations, while the State shall refund Article 12 A joint-venture trading company shall submit financial, accounting and statistical statements and reports to the local competent Article 13 A joint-venture trading company shall apply for membership in a chamber of commerce for importers and exporters or association of Article 14 A joint-venture trading company shall abide by laws and regulations of the People’s Republic of China and subordinate itself to the A joint-venture trading company which has violated Chinese laws or regulations shall be dealt with according to relevant laws and Article 15 Joint-venture foreign trading companies set up by companies or enterprises in Hong Kong, Macao and Taiwan regions and companies or Article 16 The places for the experimentation and the number of pilot companies shall be determined by the State Council. For the time being, Article 17 These Measures shall enter into force on the date of enactment, and the power of interpretation is vested in the national competent (The English translation is for reference only)
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