关于加强外商投资企业审批、登记、外汇及税收管理有关问题的通知 Issues Relevant to Strengthening the Administration of Examination and Approval, Registration, Foreign Exchange and Taxation of Foreign-invested Enterprises Circular
颁布日期：20021230 实施日期：20030101 颁布单位：对外贸易经济合作部、 国家税务总局、 国家工商行政管理总局、 国家外汇管理局
（Issued by the Ministry of Foreign Trade and Economic Cooperation， State Administration of Taxation， State Administration for Industry and Commerce and State Administration of Foreign Exchange on 30 December 2002 and effective as of 1 January 2003.）
The following Circular has been issued in respect of the issues relevant to strengthening the administration of examination and approval， registration， foreign exchange and taxation of foreign-invested enterprises pursuant to the Sino-foreign Equity Joint Venture Law， the Sino-foreign Co-operative Joint Venture Law， the Wholly Foreign-owned Enterprise Law， the Company Law， the Contract Law， the Foreign Exchange Control Regulations and other relevant laws and regulations， in order to adapt to the new situation for absorption of foreign investment， standardize the administration of foreign-invested enterprises， safeguard the healthy development of foreign-invested enterprises and protect the lawful rights and interests of Chinese and foreign investors：
1. The establishment of foreign-invested enterprises and their contracts and articles of association （including any amendment thereto） shall be examined and approved pursuant to the current procedures for examination and approval of foreign-invested enterprises in accordance with the relevant State laws and regulations.
2. According to the provisions of the current laws and regulations on foreign investment， the ratio of capital contribution of the foreign investor in the registered capital of a Sino-foreign equity joint venture or a Sino-foreign cooperative joint venture shall in general be no less than 25%. Where the capital contribution of the foreign investor accounts for less than 25%， the joint venture shall be examined， approved and registered according to the current procedures for examination， approval and registration of establishment of foreign-invested enterprises unless otherwise provided in laws and administrative regulations. If the joint venture has been examined and approved， a foreign-invested enterprise approval certificate with the notation of “foreign investment ratio less than 25%” thereon shall be issued. If it is registered， a foreign-invested enterprise business licence with the notation of “foreign investment ratio less than 25%” following the “Type of Enterprise” column shall be issued.
3. Unless otherwise provided in laws and regulations， a foreign-invested enterprise in which the capital contribution of the foreign investor is less than 25% shall not enjoy tax exemption or reduction on equipment and materials that are imported under the total investment amount of the enterprise for self-use， and shall not enjoy foreign-invested enterprise treatments in respect of other taxes.
Foreign-invested companies limited by shares that are already enjoying foreign-invested enterprise treatments may continue to enjoy such treatments in accordance with the relevant provisions after a capital and share increase or transfer of equity to other foreign investors.
4. Where the investors in a foreign-invested enterprise in which the capital contribution of the foreign investor is less than 25% contribute capital in cash， such capital shall be paid in full within three months of the date the enterprise obtains its business licence. Where the investors contribute capital in kind or with industrial property rights， etc.， such capital shall be paid in full within six months of the date the enterprise obtains its business licence.
5. If a foreign investor acquires equity in a domestic enterprise of any nature or type， such domestic enterprise shall change and re-establish as a foreign-invested enterprise after approval by the examination and approval authority pursuant to the current procedures for examination and approval of foreign-invested enterprises， in accordance with the provisions of the relevant State laws and regulations and in compliance with the industrial policy for foreign investment. After it has been approved， the examination and approval authority shall issue a foreign-invested enterprise approval certificate， and the administration authority for industry and commerce shall issue a foreign-invested enterprise business licence.
Subject to approval， the Chinese natural person shareholders of the original domestic company that have held the status of shareholders for over one year may continue to be Chinese investors of the foreign-invested enterprise that is re-established after the change.
For the time being， Chinese natural persons in China are not permitted to establish foreign-invested enterprises with foreign companies， enterprises， other economic organizations or individuals by way of new establishment or acquisition.
6. If a foreign investor acquires equity in a domestic enterprise， it shall pay the full purchase price within three months of the date of issue of the foreign-invested enterprise business licence. In special circumstances where the payment period needs to be extended， after approval by the examination and approval authority， the foreign investor shall pay over 60% of the total purchase price within six months of the date of issue of the business licence and make full payment within one year， and shall be entitled to distribution of earnings in accordance with the ratio of its actually paid-in capital contribution. Before it has paid the purchase price in full， an investor with controlling equity shall neither obtain the decision making power in the enterprise nor include its rights and interests and assets in the enterprise in its financial statements by way of consolidated statements. The foreign investment exchange registration certificate issued by the foreign exchange control authority at the place where the transferor of the equity is located shall be the valid document evidencing the full payment of the purchase price by the foreign investor.
Where a foreign investor acquires equity in a domestic enterprise， the parties to the equity transfer shall stipulate in the executed equity transfer agreement the time limit for payment of the purchase price for the equity by the foreign investor. Where the relevant time limit is not stipulated in the agreement， such agreement shall not be approved by the examination and approval authority.
7. A foreign-invested enterprise shall handle foreign exchange registration procedures with the foreign exchange control authority at the place of its business registration on the strength of its foreign-invested enterprise approval certificate and foreign-invested enterprise business licence.
When approving a foreign investor's acquisition of the equity of a domestic enterprise， the examination and approval authority shall forward copies of the official reply concerning the equity transfer to the foreign exchange control authorities at the places where the domestic enterprise and the transferor of the equity are located， and the foreign exchange control authority at the place where the transferor of the equity interest is located shall supervise the receipt of foreign exchange.
8. All examination and approval authorities， business registration authorities and foreign exchange control authorities shall strictly enforce the provisions hereof. Beginning from the date of the implementation hereof， no examination and approval， business registration or foreign exchange registration shall be granted unless the procedures for examination and approval have been carried out in accordance herewith.
Enterprises with a foreign investment ratio of less than 25% established prior to the implementation hereof shall carry out the procedures for examination and approval and registration within half a year of the date of implementation hereof. If an enterprise fails to do so in accordance with provisions， the business registration authority shall order it to carry out the procedures within a time limit. If it fails to do so within the time limit， the business registration authority shall impose a penalty in accordance with Article 63 of the Administration of Company Registration Regulations. If the enterprise still fails to carry out the relevant procedures after being penalized， it shall not be allowed to pass the annual inspection for the current year.
All business registration authorities shall duly handle the work regarding the enterprise statistics， adjustment of registration jurisdiction and transfer of enterprise files in accordance herewith. The amendment of registration of enterprises that have carried out examination and approval procedures shall fall within the jurisdiction of the registration authority with the power to register foreign-invested enterprises at the place where the enterprise is located.
9. In the event of any inconsistency between the provisions previously issued and the provisions hereof， the provisions hereof shall prevail.
10. This Circular may be applied to the investment in and establishment of foreign-invested enterprises by Taiwan， Hong Kong and Macao investors in the mainland.
11. This Circular shall be implemented as of 1 January 2003.