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CONSTITUTION OF THE PEOPLE’S REPUBLIC OF CHINA 1982

CIVIL PROCEDURE LAW OF THE PEOPLE’S REPUBLIC OF CHINA

DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS APPROVING THE OPENING OF PORT NANTONG AND PORT ZHANGJIA ON THE YANGTZE RIVER TO VESSELS OF FOREIGN NATIONALITIES

Category  COMMUNICATIONS AND TRANSPORT Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  In Force
Date of Promulgation  1982-11-19 Effective Date  1982-11-19  


Decision of the Standing Committee of the National People’s Congress Approving the Opening of Port Nantong and Port Zhangjia on the
Yangtze River to Vessels of Foreign Nationalities

(Adopted on November 19, 1982)

    Having considered the proposal submitted for approval by the State
Council on the opening of Port Nantong and Port Zhangjia on the Yangtze
River to vessels of foreign nationalities, the 25th Meeting of the Standing
Committee of the Fifth National People’s Congress hereby decides to approve
the opening of Port Nantong and Port Zhangjia on the Yangtze River to
vessels of foreign nationalities.





RULES FOR THE IMPLEMENTATION OF FOREIGN EXCHANGE CONTROL REGULATIONS RELATING TO ENTERPRISES WITH OVERSEAS CHINESE CAPITAL, FOREIGN-CAPITAL ENTERPRISES AND CHINESE-FOREIGN EQUITY JOINT VENTURES

Category  BANKING Organ of Promulgation  The State Council Status of Effect  Invalidated
Date of Promulgation  1983-08-01 Effective Date  1983-08-01 Date of Invalidation  1996-04-01


Rules for the Implementation of Foreign Exchange Control Regulations Relating to Enterprises With Overseas Chinese Capital, Foreign-capital
Enterprises and Chinese-foreign Equity Joint Ventures



(Approved by the State Council of the People’s Republic of China on July

19, 1983 and promulgated by the State Administration of Foreign Exchange
Control on August 1, 1983)(Editor’s Note: These Rules have been annulled
by Regulations of the People’s Republic of China on Foreige Exchange Control
promulgated on January 29, 1996 and effective as of April 1, 1996)

    Article 1  These Rules are formulated for implementing the provisions of
Chapter V of the Interim Regulations on Foreign Exchange Control of the
People’s Republic of China.

    Article 2  In Chapter V of The Interim Regulations on Foreign Exchange
Control of the People’s Republic of China, the term “enterprises with overseas
Chinese capital” refers to corporations, enterprises or other economic
entities registered in China with overseas Chinese capital or capital of
compatriots in the Hong Kong and Macao regions, and managed independently or
jointly with Chinese enterprises; the term “foreign-capital enterprises”
refers to corporations, enterprises or other economic entities registered in
China with foreign capital, and managed independently or jointly with Chinese
enterprises; the term “Chinese-foreign equity joint ventures” refers to
enterprises jointly established, owned and run in China by corporations,
enterprises, other economic entities or individuals with overseas Chinese
capital, capital of compatriots in the Hong Kong and Macao regions or foreign
capital and Chinese corporations, enterprises or other economic entities.

    Article 3  For all foreign exchange receipts and payments, enterprises
with overseas Chinese capital, foreign-capital enterprises and Chinese-foreign
equity joint ventures must act in accordance with the provisions in the
Interim Regulations on Foreign Exchange Control of the People’s Republic of
China as well as these Rules.

    Article 4  Enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures shall open Renminbi
deposit accounts and foreign exchange deposit accounts in China with the Bank
of China or its branch banks or any other banks approved by the State
Administration of Foreign Exchange Control (SAFEC) or its branch offices,
payments and receipts in these accounts being subject to the supervision of
the bank with which the enterprises have established accounts. When applying
for the opening of the accounts, the enterprises shall submit for verification
their business licenses issued by the State Administration for Industry and
Commerce of the People’s Republic of China.

    Article 5  The exploration fund and the fund for cooperative development
and cooperative production provided unilaterally by a foreign-capital
enterprise engaged in cooperative exploitation of offshore petroleum resources
in China are permitted to be deposited with the agreement of the Chinese side
in a bank, of a foreign country or of the Hong Kong or Macao region.

    Article 6  Should they find it necessary to open foreign exchange deposit
accounts with banks abroad or in the Hong Kong and Macao regions other than
the accounts opened in accordance with Article 5 of these Rules, enterprises
with overseas Chinese capital, foreign-capital enterprises and Chinese-foreign
equity joint ventures shall apply to SAFEC or its branch offices for approval.
The enterprises concerned shall submit to SAFEC or its branch offices
quarterly statements of payments into and withdrawal from such accounts within
30 days as of the end of each and every quarter.

    Article 7  All foreign exchange receipts of enterprises maintaining
foreign exchange accounts with banks in China in accordance with Article 4 of
these Rules, must be deposited in the said accounts and all their foreign
exchange disbursements incurred in normal business operations can be effected
through these accounts.

    Article 8  For the implementation of the petroleum operations specified in
their contracts, the foreign-capital enterprises engaged in cooperative
exploitation of offshore petroleum resources may pay directly outside China
wages, salaries, cost of procurements, various labour costs and service
charges to foreign workers and staff members, foreign subcontractors and
suppliers. The foreign workers and staff members and foreign subcontractors
shall pay taxes on their income derived from China in accordance with the
provisions of the tax law of the People’s Republic of China.

    Article 9  Enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures shall submit within the
prescribed time limit to the SAFEC or its branch offices the following
statements with explanatory notes in detail:

    (1) Balance sheet as of December 31 of the previous year, profit and loss
statement and statement of receipts and payments of foreign exchange for the
previous year shall be submitted before March 31 of each year, along with
audit reports by accountants registered in the People’s Republic of China.

    (2) Budget of foreign exchange receipts and payments for the coming year
shall be submitted before December 1 of each year (subsequent amendments, if
any, shall be reported immediately).

    The SAFEC and its branch offices are authorized to request the enterprises
with overseas Chinese capital, foreign-capital enterprises and Chinese-foreign
equity joint ventures to provide information about their business activities
involving foreign exchange, and to check on their foreign exchange incomes and
expenditures.

    Article 10  Any currency conversion of enterprises with overseas Chinese
capital, foreign-capital enterprises and Chinese-foreign equity joint ventures
must be conducted according to the official rates of foreign exchange quoted
by the SAFEC; the export of the products of these enterprises may be dealt
with in accordance with the relevant provisions governing China’s foreign
trade exchange conversions.

    Article 11  Except where otherwise approved by the SAFEC or its branch
offices, the foreign exchange receipts realized from exports by the
enterprises with overseas Chinese capital, foreign-capital enterprises and
Chinese-foreign equity joint ventures shall be transferred back and credited
to their foreign exchange deposit accounts with banks in China and the
enterprises shall also go through the procedure of cancelling their
commitments for foreign exchange receipts from these exports.

    Article 12  Renminbi shall be used in the settlement of accounts between
enterprises with overseas Chinese capital, foreign-capital enterprises or
Chinese-foreign equity joint ventures on the one hand, and agencies,
enterprises (including enterprises with overseas Chinese capital,
foreign-capital enterprises, Chinese-foreign equity joint ventures), or
individuals in China on the other, except in the following cases:

    (1) For products manufactured by these enterprises and sold to Chinese
entities or enterprises engaged in foreign trade which would otherwise have
to import, foreign currencies may be used in pricing and in settlement of
accounts, provided that prior approval by Chinese foreign trade authorities
has been obtained and that agreement on this arrangement has been reached
between seller and buyer; the prices of the products may be such as to be
commensurate with those current in world markets.

    (2) If enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures purchase, for the sake
of production, the commodities to be exported or imported by Chinese entities
engaged in foreign trade, foreign currencies may be used in pricing the said
commodities with reference to those current in world markets and in settlement
of accounts, with prior approval of Chinese foreign trade authorities and
arrangement between seller and buyer.

    (3) Foreign currencies may be used in pricing and in the settlement of
accounts related to construction work performed by Chinese construction
entities according to contracts, provided that prior approval from the SAFEC
or its branch offices has been obtained.

    (4) Other items which can be priced and settled in foreign currencies
are prescribed by the State Council or approved by the SAFEC or its branch
offices.

    For all transactions which can be priced and settled in foreign currencies
as approved, the receipts and payments may be made through foreign exchange
deposit accounts.

    Article 13  Overseas Chinese investors of enterprises with overseas
Chinese capital or foreign investors of foreign-capital enterprises or of
Chinese-foreign equity joint ventures may apply to the banks with which they
have opened accounts for remitting abroad their profits as well as other
justified earnings after taxation, by debiting the foreign exchange deposit
accounts of the enterprise concerned. At the time of application, the
investors concerned shall submit for examination the written decision on
profit distribution adopted by the board of directors or by another organ of
power equivalent to the board of directors, documentary evidence showing that
all taxes have been duly paid as well as the contracts containing stipulations
with regard to the distribution of profits or earnings.

    Overseas Chinese investors of enterprises with overseas Chinese capital
or foreign investors of foreign-capital enterprises or of Chinese-foreign
equity joint ventures shall apply to the SAFEC or its branch offices for
transferring their foreign exchange capital abroad by debiting the foreign
exchange deposit accounts of the enterprises concerned.

    Article 14  Enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures engaged in cooperative
exploitation of such resources as offshore petroleum and coal, and in other
contractual or equity joint ventures, whose capital is to be recovered and
profits to be realized in kind as stipulated in their contracts, may transport
out of China the products as their shares of recovered capital and realized
profits, but such enterprises shall remit back the amount of tax to be paid in
the People’s Republic of China as well as other required payments. If the
products are to be sold within China, the case shall be handled in accordance
with provisions of Article 12 of these Rules, and the foreign exchange
proceeds derived from these sales may be remitted out after taxation and other
required payments.

    Article 15  Staff members and workers of foreign nationality and those
from the Hong Kong and Macao regions employed by enterprises with overseas
Chinese capital, foreign-capital enterprises and Chinese-foreign equity joint
ventures may remit abroad their wages and other justified earnings, after
taxation according to law, and if the remittance exceeds 50% of their wages
and other earnings, they may apply to the SAFEC or its branch offices. The
amounts remitted shall all be debited to the foreign exchange deposit accounts
of the enterprises concerned.

    Article 16  Foreign exchange expenses required in the normal business
operations of the branches or offices abroad or in the Hong Kong and Macao
regions set up with the approval of competent authorities by enterprises with
overseas Chinese capital, foreign-capital enterprises and Chinese-foreign
equity joint ventures may be remitted to these branches or offices, debiting
to the foreign exchange deposit accounts of the enterprises concerned, with
the approval of the SAFEC or its branch offices.

    Article 17  Enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures may borrow foreign
exchange directly from banks or enterprises of foreign countries or of the
Hong Kong and Macao regions, but they must report such borrowing to the SAFEC
or its branch offices for the record.

    Article 18  Enterprises with overseas Chinese capital, foreign-capital
enterprises and Chinese-foreign equity joint ventures winding up operations
in accordance with legal procedures, shall carry out liquidation within the
scheduled period, under the joint supervision of China’s finance, taxation
and foreign exchange control authorities. Overseas Chinese investors or
foreign investors shall be responsible for their taxes due and their
outstanding liabilities within China. After completion of the liquidation,
overseas Chinese investors and foreign investors may apply to the SAFEC or its
branch offices for remitting out the funds owned by or distributed to them.
And the remittance shall be debited to the foreign exchange accounts
of the liquidated enterprises.

    Article 19  The measures to control foreign exchange receipts and payments
of banks with overseas Chinese capital, banks with foreign capital,
Chinese-foreign equity joint banks and other financial institutions shall be
formulated by the SAFEC separately.

    Article 20  These Rules shall be promulgated and put into effect by the
SAFEC upon approval of the State Council.





REGULATIONS ON THE ADMINISTRATION OF THE REGISTRATION OF ENTERPRISES IN THE XIAMEN SPECIAL ECONOMIC ZONE

Regulations on the Administration of the Registration of Enterprises in the Xiamen Special Economic Zone

    

(Effective Date 1984.07.14)

   Article 1. These Regulations are formulated in accordance with the relevant laws and statutory regulations of the People’s Republic
of China.

   Article 2. Enterprises established in the Special Zone must carry out registration procedures with the Xiamen Municipal Industry
and Commerce Administration Bureau. Any enterprise which is not registered will not be permitted to go into operation.

   Article 3. In applying for registration, a Special Zone enterprise shall produce the following documents:

(i) a document of approval issued by the Xiamen Municipal People’s Government or the organ in charge authorised
by the Municipal People’s Government;

(ii) copies of the approved agreement, contract and articles of association signed by the various parties to the enterprises;

(iii) copies of the business licence or other relevant documents issued by the government department in charge in
the country (or region) in which each of the parties to the enterprise is based.

A Special Zone enterprise shall also submit the approval document issued by the relevant department in charge should
its undertaking be classified by the State as a specialised line of business or trade.

   Article 4. In applying for registration, a Special Zone enterprise shall fill out a registration form in triplicate in Chinese
or in both Chinese and foreign languages. The main items to be registered are: the name of the enterprise, the address,
the scope of production or business, the form of production or business, the registered capital, the shares of the respective
joint equity or co-operative parties, or the chairman and vice-chairmen of the board of directors, the general manager
and deputy general manager, or the director and deputy directors of the factory, the number of employees, the number
of foreign employees, the document approving organ, the approval document’s number and date of approval.

   Article 5. Resident representative offices to be established in the Special Zone by foreign enterprises, enterprises run by
Overseas Chinese, or persons from Hong Kong, Macao and Taiwan, and Sino-foreign joint ventures based outside China
shall, within 30 days of the date of approval, register with the Xiamen Municipal Industry and Commerce Administration
Bureau by presenting copies of the approval document and the registration certificate issued by the organ in charge
in the country (or region) in which the enterprise is located or other evidence of credit-worthiness, together with the
representative’s letter of authorisation. Without registration, a resident office will not be permitted to engage
in business activities.

   Article 6. Special Zone enterprises and resident offices are deemed to be officially established on the day on which their business
licence or registration certificate is obtained. Their proper business activities and legitimate rights and interests
are protected by the law of the People’s Republic of China.

   Article 7. A Special Zone enterprise or resident office, shall present its business licence or registration certificate for opening
an account with a bank established in the Xiamen Special Zone and register with the Xiamen Municipal Taxation Bureau
for taxation purposes.

   Article 8. When a Special Zone enterprise changes its name or location, its line of production, increases, decreases or transfers its
registered capital, changes the scope of its production or business, or extends the duration of its contract, the
enterprise shall register the change with the Xiamen Municipal Industry and Commerce Administration Bureau within 30
days of the change being approved by the original examining and approval organ. In the event of the replacement of
an enterprise’s chairman or general manager, the enterprise shall register the change within seven days of the decision
of the board of directors. The registration of other changes shall be submitted in writing to the Xiamen Municipal
Industry and Commerce Administration Bureau at the end of each year.

   Article 9. The registration certificate for a resident office will be renewed every year. When changing the name of the resident
office, the resident representative(s), the scope of operations, the location of the resident office and the
term of residency, the registration of the same shall be made by producing the approval document to the Xiamen Municipal
Industry and Commerce Administration Bureau within seven day of the changes being approved by the original approval organ.

   Article 10. When applying for registration or the registration of changes, Special Zone enterprises or resident offices shall
pay the fee for registration or the registration of changes in accordance with regulations.

   Article 11. Upon the expiry of the term of operations or residency period, or upon the approved pre-term closure or termination of
business, a Special Zone enterprise or resident office shall undertake the cancellation of registration, and hand
in for cancellation the business licence or registration certificate with the Xiamen Municipal Industry and Commerce
Administration Bureau.

   Article 12. The Xiamen Municipal Industry and Commerce Administration Bureau shall examine, verify and give an official reply
to Special Zone enterprises or resident offices, within seven days of receiving the various documents from the enterprises
or offices concerning registration or the registration of changes.

   Article 13. The Xiamen Municipal Industry and Commerce Administration Bureau supervises and inspects Special Zone enterprises
and resident offices in accordance with the law. In the case of violation of these Regulations, the enterprise
or resident office concerned shall, on the basis of the seriousness of each specific case, be given a warning, a fine,
be ordered to suspend operations, or have is business licence or registration certificate revoked. In the case
of suspension of operations or revocation of the business licence or registration certificate, the matter must be
reported to the Xiamen Municipal People’s Government for examination and approval and be filed with the Industry
and Commerce Administration Bureau.

   Article 14. These Regulations will be effective from the date fo promulgation.

    





CUSTOMS RULES OF THE PEOPLE’S REPUBLIC OF CHINA ON THE IMPORT OF LEGACIES

PROVISIONS OF THE MINISTRY OF FOREIGN ECONOMIC RELATIONS AND TRADE, THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE CONCERNING THE INVESTMENTS MADE BY THE VARIOUS PARTIES OF CHINESE-FOREIGN EQUITY JOINT VENTURES

19871230the State Council

The Ministry of Foreign Economic Relations and Trade, the State Administration for Industry and Commerce

Provisions of the Ministry of Foreign Economic Relations and Trade, the State Administration for Industry and Commerce Concerning
the Investments Made by the Various Parties of Chinese-foreign Equity Joint Ventures

January 1,1988

(Approved by the State Council on December 30, 1987, Promulgated by the Ministry of Foreign Economic Relations and Trade and the State
Administration for Industry and Commerce on January 1, 1988)

Article 1

These Provisions are formulated in accordance with the Law of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures
and other pertinent laws and regulations in order to protect the lawful rights and interests of the various parties to Chinese-foreign
equity joint ventures (hereinafter referred to as the “joint ventures”), and to maintain the social economic order.

Article 2

The investments contributed by the various parties to a joint venture in accordance with the stipulations of the contract of the said
joint venture must be the cash owned by the parties themselves as well as the physical goods, the industrial property rights, the
proprietary technology and etc. that are owned by the parties themselves and have not been used to establish any security interests.

In cases where physical goods, industrial property rights and proprietary technology are used as investments at the evaluated price,
the investor shall present valid documents attesting their proprietary rights and their right of disposal.

Article 3

No party to a joint venture may use the loans, rented equipment or other assets it has obtained in the name of the joint venture,
or the assets of persons other than the parties as its own investment contribution to the joint venture; nor may it use the assets
or rights and interests of the joint venture, or the assets or rights and interests of the other parties to the joint venture as
the warranty for its investment contribution to the joint venture.

Article 4

The various parties to a joint venture shall set the time limit in their joint venture contract for paying up their respective investment
contributions to the joint venture, and they shall pay fully their respective investment contributions within the time limit stipulated
in the joint venture contract. The investment contribution certificates issued by the joint venture in accordance with the pertinent
stipulations shall be submitted to the original examining and approving authorities and the relevant administrative department for
industry and commerce for the record.

If the joint venture contract stipulates that investment contributions shall be paid up in one lump, the various parties to the said
joint venture shall make the full payment of their respective investment contributions within six months from the date the business
licence is signed and issued.

If the joint venture contract stipulates that investments shall be paid by installments, the first installment paid by the various
parties shall not be less than 15% of the total amount of their respective investment contributions and be paid within three months
as of the date the business licence is signed and issued.

Article 5

In the event that the various parties to a joint venture fail to make the full payment of their respective investment contributions
within the time limit prescribed in Article 4 , the joint venture shall be considered to be dissolved of its own accord, and the
approval certificate for the joint venture shall automatically cease to be effective. The joint venture shall go through the procedures
for cancellation of registration with the administrative department for industry and commerce, and hand in its business licence for
cancellation; if a joint venture fails to go through the procedures for cancellation of registration or to hand in its business licence
for cancellation, the administrative department for industry and commerce shall revoke its business licence and announce this publicly.

Article 6

After the various parties to a joint venture have paid the first installment of their respective investment contributions, if they
fail to pay or to pay fully any of the remaining installments three months beyond the deadline as stipulated in the joint venture
contract, the administrative department for industry and commerce shall, in conjunction with the original examining and approving
authorities, issue a notice to the various parties to the said joint venture, enjoining them to pay the full amount due within one
month. In the event that the various parties to the said joint venture still fail to make the full payment of their respective investment
contributions in accordance with the time limit prescribed in the notice mentioned in the preceding paragraph, the original examining
and approving authorities have the right to revoke the approval certificate for the said joint venture. After the approval certificate
has been revoked, the said joint venture shall go through the procedures for cancellation of registration with the administrative
department for industry and commerce, hand in its business licence for cancellation, and settle claims and debts. If it fails to
go through the procedures for cancellation of registration or to hand in its business licence for cancellation, the administrative
department for industry and commerce has the right to revoke its business licence and to announce this publicly.

Article 7

The failure of one of the parties to a joint venture to make the payment, or the full payment, of its investment contribution on time
in accordance with the stipulations of the joint venture contract constitutes a breach of the contract. The observant party (parties)
shall urge the defaulting party to make the payment, or the full payment, of its investment contribution within one month. If the
defaulting party still fails to do so before the deadline, this shall be considered as the abandonment by the defaulting party of
all its rights as stipulated in the joint venture contract and its withdrawal from the joint venture of its own accord. The observant
party (parties) shall, within one month from the date when the defaulting party’s prescribed payment is overdue, make an application
to the original examining and approving authorities for the approval to dissolve the said joint venture, or for the approval to find
another joint venture party to assume the defaulting party’s rights and obligations as stipulated in the joint venture contract.
The observant party (parties) may, according to law, claim compensation from the defaulting party for the economic losses caused
by the latter’s failure to make the payment, or the full payment, of its investment contribution.

If the defaulting party mentioned in the preceding paragraph has paid part of its prescribed investment contribution, this part of
investment payment shall be liquidated by the joint venture.

In the event that the observant party (parties) fails (fail) to make an application to the original examining and approving authorities,
in accordance with the provisions of the first paragraph of this Article, for the approval to dissolve the joint venture, or for
the approval to find another joint venture party, the examining and approving authorities have the right to revoke the approval certificate
issued to that joint venture. After the approval certificate has been revoked, the said joint venture shall go through the procedures
for cancellation of registration with the administrative department for industry and commerce, and hand in its business licence for
cancellation; if it fails to go through the procedures for registration cancellation or to hand in its business licence for cancellation,
the administrative department for industry and commerce has the right to revoke its business licence and to announce this publicly.

Article 8

With respect to any joint venture which obtained its business licence before the date these Provisions become effective, if the various
parties or any one of these parties have (has) failed to make the payment of the respective investment contributions in accordance
with the time limits stipulated in the joint venture contract, they (it) shall, within two months as of the date these Provisions
become effective, make the full payment of the prescribed investment contributions in accordance with the provisions of the contract.

In the event that the various parties or any one of the parties still fail(s) to make the full payment of the respective investment
contributions within the time limit prescribed in the preceding paragraph, the case may be handled in accordance with the provisions
in Article 5 through Article 7 of these Provisions.

Article 9

With respect to any joint venture which obtained its business licence before the date these Provisions become effective, if the various
parties to that joint venture have not stipulated in their joint venture contract the respective time limits for making their respective
investment contributions, and they have not made the full payment, the various parties shall, within two months as of the date these
Provisions become effective and in accordance with these Provisions, conclude and sign a supplementary agreement to their joint venture
contract prescribing the time limits for the various parties to the joint venture to make the payment of their respective investment
contributions, and submit this supplementary agreement to the original examining and approving authorities for examination and approval;
after they have obtained the approval, they shall submit their case to the administrative department for industry and commerce for
the record.

In the event that a joint venture mentioned in the preceding paragraph fails to establish itself or to start its operations after
six full months since the date of the issuance of its business licence owing to the failure of its various parties to conclude and
sign a supplementary agreement to their joint venture contract within two month prescribed in the preceding paragraph, prescribing
the time limits for making their respective investment payments, and the failure to pay full their respective investment contributions,
the original examining and approving authorities have the right to revoke the approval certificate issued to that joint venture.
After the approval certificate has been revoked, the said joint venture shall go through the procedures for cancellation of registration
with the administrative department for industry and commerce, and hand in its business licence for cancellation. If the said joint
venture fails to go through the procedures for cancellation of registration or to hand in its business licence for cancellation,
the administrative department for industry and commerce has the right to revoke its business licence and to announce this publicly.

Article 10

The investment payment made by the various parties to a Chinese-foreign contractual joint venture shall be handled with reference
to these Provisions.

Article 11

These Provisions shall enter into force as of March 1, 1988.



 
The Ministry of Foreign Economic Relations and Trade, the State Administration for Industry and Commerce
1988-01-01

 






MEASURES OF SHANGHAI MUNICIPALITY GOVERNING COMMODITY PURCHASING AND PRODUCT SALES BY FOREIGN INVESTMENT ENTERPRISES

Measures of SHANGHAI Municipality Governing Commodity Purchasing and Product Sales by Foreign Investment Enterprises

     (Effective Date:1989.07.01–Ineffective Date:)

   Article 1. These Measures are formulated in accordance with the provisions of the Law of the People’s Republic of China on Sino-foreign Joint
Equity Enterprises, the Law of the People’s Republic of China on Sino-foreign Co-operative Enterprises, the Law of the People’s Republic
of China on Enterprises with Sole Foreign Investment and other relevant administrative laws and decrees, while taking into account
the specific circumstances of the city.

   Article 2. These Measures shall apply to the purchase of commodities and sale of products by Sino-foreign joint equity enterprises, Sino-foreign
co-operative enterprises and sole foreign investment enterprises (hereinafter referred to as foreign investment enterprises) established
within the administrative district of Shanghai Municipality.

   Article 3. A foreign investment enterprise shall have the right to import commodities required for its own use and to export its own products
independently within the approved scope of its contract, but any goods subject to State import or export licence control shall be
handled in accordance with the relevant provisions of the Ministry of Foreign Economic Relation and Trade governing the application
for import and export licences by foreign investment enterprises.

An import or export licence application which comes within the authorised scope of approval of the Shanghai Municipal Commission of
Foreign Economic Relations and Trade (hereinafter referred to as the Shanghai COFERT) shall be examined, verified and, where appropriate,
an import or export licence issued within five working days of receiving the application.

   Article 4. Before endorsing the establishment of a foreign investment enterprise which proposes to manufacture products subject to State export
licence control, the local municipal examining and approval organ shall consult the Shanghai COFERT or, through it, the higher authorities
in charge of foreign economic relations and trade, and shall urge the applicant to undertake and supervise its completion of all
necessary formalities.

   Article 5. Commodities required by a foreign investment enterprise for its production and business operations may be purchased on the international
marker or from local Shanghai markets or other domestic Chinese markets.

A foreign investment enterprise may purchase commodities from local Shanghai markets through the following channels:

(1) local municipal foreign investment enterprise commodity service companies;

(2) commodity dealers;

(3) foreign trade corporations;

(4) commodity producers;

(5) bonded warehouses;

(6) commodity fairs and trade centres.

Units or enterprises dealing in commodities shall give priority to meeting the needs of exporting enterprises and technologically
advanced enterprises, providing the same conditions prevail.

   Article 6. A foreign investment enterprise may purchase without restriction on local Shanghai markets any amount of office supplies and domestic
consumer goods that it may require.

   Article 7. The supply of materials needed by a foreign investment enterprise to manufacture products listed in State or local municipal production
plans or purchasing contracts shall be assured by the department which organised the production plan or allocated the contract.

Materials required by a foreign investment enterprise for a capital construction project which is included in the city’s commodity
distribution plans shall be supplied by the relevant units or enterprises dealing in those materials, in accordance with the plans.

   Article 8. In the case of a Chinese investor which, together with a foreign partner, invests all or part of its assets in the establishment
of a foreign investment enterprise, unless the approval documents specifically exclude materials from inclusion in the commodity
distribution plan, the relevant departments shall ensure that, in accordance with its investment status, the Chinese investor’s original
commodity supply channels are maintained and commodity dealers shall continue to provide materials pursuant to the original supply
plans.

   Article 9. A foreign investment enterprise may use its profits as investment to form affiliated enterprises with other enterprises in China
and to establish commodity supply bases relevant to its production needs. These affiliated enterprises may enjoy preferential treatment
in accordance with the relevant provisions of the State and local municipal authorities regarding the development of horizontal integration.

Before an affiliated enterprise may be established, a foreign investment enterprise shall be required to submit documents clarifying
the source of investment funds and investment projects to the original examining and approval organ and the local municipal administration
for industry and commerce and, after these documents have been examined and approved, it shall complete formalities for the registration
of affiliated enterprises in accordance with the relevant provisions.

   Article 10. In addition to a foreign investment enterprise itself importing required commodities, it may also engage as an import agent a municipal
foreign investment enterprise commodity service company, a commodity dealer authorised to conduct import operations or a State or
local municipal foreign trade corporation.

All units and enterprises dealing in commodities shall be required to provide good service to foreign investment enterprises.

   Article 11. Foreign investment enterprises shall strive to sell their products on the international market. Products manufactured by a foreign
investment enterprise which are urgently required by the State or Shanghai Municipality or which are currently imported may be sold
primarily on the local market, subject to approval.

The provisions of the Ministry of Foreign Economic Relations and Trade Measures for Foreign Investment Enterprises Purchasing Domestic
Products for Export to Achieve a Balance of Foreign Exchange Income and Expenditure shall be implemented if a foreign investment
enterprise needs to purchase domestic products for export in order to remedy its foreign exchange shortfall.

   Article 12. In addition to exporting its products itself, a foreign investment enterprise may also sell its products on a commission or agency
basis through the following channels:

(1) the foreign partner’s sales outlets;

(2) State foreign trade organs based in Shanghai;

(3) local foreign trade corporations and enterprises with import/ export rights;

(4) State or local export commodity fairs and trade conferences.

   Article 13. Those products of a foreign investment enterprise which are classified as planned distribution commodities shall be included in the
distribution plan of the commodity control department and sold to the designated users. In the case of production material for key
industrial goods, sales shall be conducted at the producer goods markets of large or medium size cities or through designated sales
agents in accordance with State regulations.

   Article 14. A foreign investment enterprise may establish commodity purchasing and product sales agents abroad, subject to approval from relevant
examining and approval organs.

   Article 15. Administration of enterprises invested in and established in Shanghai Municipality by Overseas Chinese, Hong Kong, Macao or Taiwanese
businesspeople shall be handled in accordance with the provisions of these Measures.

   Article 16. The Shanghai Municipal Foreign Investment Commission and the Municipal Material and Equipment Bureau shall be jointly responsible
for the interpretation of these Measures.

   Article 17. These Measures shall take effect from 1 July 1989. The Regulations on Commodity Supply and Marketing and Price Control for Sino-foreign
Joint Equity Ventures in Shanghai Municipality (Trial Implementation), promulgated 5 December 1984 by the Shanghai Municipal People’s
Government, shall be abrogated simultaneously.

    





INTERIM PROVISIONS FOR THE ADMINISTRATION OF FOREIGN CHAMBERS OF COMMERCE IN CHINA

Category  FOREIGN ECONOMIC RELATIONS AND TECHNOLOGICAL COOPERATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1989-06-14 Effective Date  1989-07-01  


Interim Provisions for the Administration of Foreign Chambers of Commerce in China



(Adopted by the State Council at the 39th Executive Meeting on April 28,

1989, promulgated by Decree No. 36 of the State Council of the People’s
Republic of China on June 14, 1989, and effective as of July 1, 1989)

    Article 1  These Provisions are formulated with a view to promoting
international trade and economic and technological exchanges, strengthening
the administration of foreign chambers of commerce and protecting their
legitimate rights and interests.

    Article 2  A foreign chamber of commerce in China refers to a
non-profit-making organization which is set up in accordance with these
Provisions within the Chinese territory by foreign commercial establishments
and personnel in the Chinese territory and does not engage in any business
transactions.

    The activities of foreign chambers of commerce in China shall be aimed at
promoting trade and economic and technological exchanges between their members
and Chinese counterparts and facilitating their research in and discussions
about the development of international trade and economic and technological
exchanges.

    Article 3  Foreign chambers of commerce in China must abide by the laws
and regulations of the People’s Republic of China and shall not jeopardize
the state security and social and public interests of China.

    Article 4  For the setting up of a foreign chamber of commerce in China,
the following conditions shall be satisfied:

    (1) articles of association reflecting the common will of the Chamber’s
members;

    (2) a certain number of sponsoring members and responsible persons;

    (3) premises as its permanent office; and

    (4) lawful sources of funds.

    Article 5  Foreign chambers of commerce in China shall be set up according
to their respective country origins and may have both group members and
individual members.

    Group members mean those which join the chamber in the name of commercial
establishments. Commercial establishments refer to representative offices or
branches set up in the Chinese territory according to law by foreign
companies, enterprises and other economic organizations.

    Individual members mean those staff members of non-Chinese nationality
working in commercial establishments or enterprises with foreign investment
and join the chamber in their own names.

    Article 6  The name of a foreign chamber of commerce in China shall be
preceded by the name of its own country plus the word “China”.

    Article 7  For the setting up of a foreign chamber of commerce in China, a
written application shall be submitted to the China Chamber of International
Commerce for further transmission to the Ministry of Foreign Economic
Relations and Trade of the People’s.

    Republic of China (hereinafter referred to as the examining authorities)
for examination.

    The examining authorities shall complete the examination within 60 days
after the date of receiving the written application and all the attached
papers. It shall issue an approval certificate if the conditions laid down in
Article 4 are satisfied or reject the application if the above-mentioned
conditions are not satisfied. The examining authorities shall give
explanations if it cannot complete the examination within the prescribed
time-limit on account of special circumstances.

    Article 8  The written application for the setting up of a foreign chamber
of commerce in China shall be duly signed by the chief sponsor and accompanied
by the following papers:

    (1) Articles of association of the chamber in quintuplicate, in which the
following items shall be included:

    a. name and address;

    b. organizational structure;

    c. names and status of the Chairman, Vice-Chairmen and Managing Director;

    d. procedure for the admission of members and their rights and
obligations;

    e. scope of activities; and

    f. financial information.

    (2) A list of the sponsoring members of the chamber in quintuplicate with
the group members and individual members listed separately. For each of the
group members, the name, address, business scope and names of the responsible
persons shall be indicated. For each of the individual members, the name of
the commercial establishment or enterprise with foreign investment for which
the individual member works, as well as his position and personal resume or
a brief account of his commercial activities in China shall be indicated.

    (3) Name and resume of each of the Chairman, Vice-Chairmen and Managing
Director of the chamber in quintuplicate.

    Article 9  After the application for the setting up of a foreign chamber
of commerce in China has been examined and approved by the examining
authorities, the chief sponsor shall, in accordance with the stipulations of
these Provisions and other relevant laws and regulations, submit the approval
certificate to the Ministry of Civil Affairs of the People’s Republic of China
(hereinafter referred to as the registration authorities) for registration. A
foreign chamber of commerce in China is established at the time its
registration is accepted and a registration certificate is issued.

    Article 10  A foreign chamber of commerce in China shall set up account
books in its office. Its membership fees and other funds obtained in
accordance with the stipulations of its Articles of Association shall be used
to cover the expenditures specified in its Articles of Association and shall
not, under any name, be used as payments to its members or remitted out of
the Chinese terntory.

    Article 11  A foreign chamber of commerce in China shall submit in January
of every year a report on its activities in the previous year to the examining
authorities and the registration authorities through the China Chamber of
International Commerce.

    The China Chamber of International Commerce shall provide foreign chambers
of commerce in China with consultative and other services for their activities
and contacts with relevant Chinese authorities.

    Article 12  When a foreign chamber of commerce in China needs to amend its
Articles of Association or replace its Chairman, Vice-Chairman, or
ManagingDirector or change the address of its premises, it shall apply for
examination and approval and register such changes in accordance with the
procedures laid down in Articles 7, 8 and 9.

    Article 13  A foreign chamber of commerce in China shall subject itself to
the supervision of relevant Chinese authorities.

    Should a foreign chamber of commerce in China violate these Provisions,
the registration authorities have the power to apply sanctions by imposing
a warning or ordering to ban it.

    Article 14  When a foreign chamber of commerce in China is to be
dissolved, it shall submit an application duly signed by its Chairman
together with a certificate proving the completion of its liquidation to the
registration authorities for cancelling its registration and report to the
examining authorities for the record.

    A foreign chamber of commerce in China shall stop any of its activities
as of the date when it returns its registration certificate to the
registration authorities.

    Article 15  These Provisions shall go into effect as of July 1, 1989.?






DECISION OF THE NATIONAL PEOPLE’S CONGRESS REGARDING THE REVISION OF THE CHINESE-FOREIGN EQUITY JOINT VENTURES

Category  FOREIGN ECONOMIC RELATIONS AND TECHNOLOGICAL COOPERATION Organ of Promulgation  The National People’s Congress Status of Effect  In Force
Date of Promulgation  1990-04-04 Effective Date  1990-04-04  


Decision of the National People’s Congress Regarding the Revision of the Law of the People’s Republic of China on Chinese-foreign
Equity Joint Ventures



(Adopted at the Third Session of the Seventh National People’s Congress on

April 4, 1990, promulgated by Order No. 27 of the President of the People’s
Republic of China and effective as of the date of promulgation)

    The Third Session of the Seventh National People’s Congress, having
considered the proposal of the State Council regarding the Amendment to the Law
of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures
(Draft), decides to make the following revisions to the Law of the People’s
Republic of China on Chinese-Foreign Equity Joint Ventures:

    1. A new paragraph shall be added to Article 2 as paragraph 3: “The state
shall not nationalize or requisition any equity joint venture. Under special
circumstances, when public interest requires, equity joint ventures may be
requisitioned by following legal procedures and appropriate compensation shall
be made.”

    2. Article 3 shall be amended as: “The equity joint venture agreement,
contract and articles of association signed by the parties to the venture shall
be submitted to the state’s competent department in charge of foreign economic
relations and trade (hereinafter referred to as the examination and approval
authorities) for examination and approval. The examination and approval
authorities shall decide to approve or disapprove the venture within three
months. When approved, the equity joint venture shall register with the state’s
competent department in charge of industry and commerce administration,
acquire a business license and start operations”.

    3. Paragraph 1 of Article 6 shall be amended as: “An equity joint venture
shall have a board of directors; the number of the directors thereof from each
party and the composition of the board shall be stipulated in the contract and
articles of association after consultation among the parties to the venture;
such directors shall be appointed and replaced by the relevant parties. The
chairman and the vice-chairman (vice-chairmen) shall be determined through
consultation by the parties to the venture or elected by the board of
directors. If the Chinese side or the foreign side assumes the office of the
chairman, the other side shall assume the office(s) of the vice-chairman
(vice-chairmen). The board of directors shall decide on important issues
concerning the joint venture on the principle of equlity and mutual benefit.”

    4.Paragraph 2 of Article 7 shall be amended as: “An equity joint venture
may, in accordance with provisions of the relevant laws and administrative
rules and regulations of the state on taxation, enjoy preferential treatment
for reduction of or exemption from taxes.”

    5. Paragraph 1 of Article 8 shall be amended as: “An equity joint venture
shall, on the strength of its business license, open a foreign exchange account
with a bank or any other financial institution which is permitted by the state
agency for foreign exchange control to handle foreign exchange transactions.”

    Paragraph 1 of Article 10 shall be amended as: “The net profit which a
foreign joint venturer receives as its share after performing its obligations
under the laws, and the agreements or the contract, the funds it receives upon
the expiration of the venture’s term of operation or its early termination, and
its other funds may be remitted abroad in accordance with foreign exchange
control regulations and in the currency or currencies specified in the contract
concerning the equity joint venture.”

    Article 11 shall be amended as: “The wages, salaries or other legitimate
income earned by a foreign worker or staff member of an equity joint venture,
after payment of the individual income tax under the tax laws of the People’s
Republic of China, may be remitted abroad in accordance with foreign exchange
control regulations.”

    6. Article 12 shall be amended as: “Based on different lines of trade and
different circumstances, arrangements for the duration of equity joint ventures
may be made differently through agreement by the parties to the venture.
Equity joint ventures engaged in certain lines of trade shall specify their
duration in the contracts, while equity joint ventures engaged in certain other
lines of trade may choose to or not to specify their duration in the contract.
Where an equity joint venture has had its duration specified and the parties
to the venture agree to extend the duration, the venture shall file an
application for the purpose with the examination and approval authorities six
months before its expiration. The examination and approval authorities shall,
within one month after receipt of the application, decide on its approval or
disapproval.”

    7. Article 13 shall be amended as: “In case of heavy losses, failure of a
party to perform its obligations under the contract and the articles of
association, or force majeure etc., the parties to the joint venture may
terminate the contract through their consultation and agreement, subject to
approval by the examination and approval authorities and to registration with
the state’s competent department in charge of industry and commerce
administration. In case of losses caused by a breach of contract, the financial
responsibility shall be borne by the party that has breached the contract.”

    This Decision shall enter into force as of the date of promulgation.

    The Law of the People’s Republic of China on Chinese-Foreign Equity Joint
Ventures shall be republished after being correspondingly amended according to
this Decision.?






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CONSTITUTION ACT, 1982 – page 22

NOTES (1) The enacting clause was repealed by the Statute Law Revision Act, 1893, 56-57 Vict., c. 14 (U.K.). It read as...

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

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