China publishes detailed implementing rules for the reform of its foreign investment regulatory regime
China has recently published certain amendments to its existing laws and some new implementing rules to further reform its foreign investment regulatory regime, in an attempt to improve access for foreign investors and attract foreign investment into China.
Amendments to the Existing FIE Laws
On 3 September 2016, the Standing Committee of the National People's Congress approved the amendments (the "Amendments") to the laws governing foreign-invested enterprises ("FIEs") in China, including:
- the Law on Wholly Foreign-owned Enterprises;
- the Law on Sino-foreign Equity Joint Venture Enterprises ;
- the Law on Sino-foreign Cooperative Joint Venture Enterprises; and
- the Law on the Protection of Investments by Taiwan Compatriots (collectively, the "FIE Laws").
The Amendments took effect on 1 October 2016.
Under the Amendments, approval from the Ministry of Commerce ("MOFCOM") or its local counterparts is no longer required for the establishment of an FIE, as well as various post-incorporation changes (such as changes in registered capital, amendments or termination of joint venture contracts and articles of association, and extension of business term). Instead there is a simple filing procedure (the "Filing Regime"), unless the sector concerned falls within the scope of a national negative list (the "National Negative List"), which will be discussed below.
The Amendments necessitate a series of updates to the existing laws and regulations. Therefore the National Development and Reform Commission ("NDRC"), the Ministry of Commerce ("MOFCOM") and the State Administration for Industry and Commerce ("SAIC") subsequently promulgated detailed implementing rules to help implement the changes introduced by the Amendments.
National Negative List
The negative list approach adopted in the Amendments is not new to China. The concept of a negative list was first introduced and implemented on a trial basis when the China (Shanghai) Pilot Free Trade Zone was launched in 2013, and subsequently rolled out to the other three free trade zones in Guangdong, Fujian and Tianjin through the promulgation of the Special Management Measures for the Market Entry of Foreign Investment in Pilot Free Trade Zones (Negative list) by the General Office of the State Council on 8 April 2015 (the "FTZ Negative List").
It was widely expected that the National Negative List would be a list that reads similar to the FTZ Negative List. However, instead of issuing a formal National Negative List, on 8 October 2016 NDRC and MOFCOM jointly issued a circular ("Circular 22"). Circular 22 states that the National Negative List shall include all of the items set out in the "restricted" and "prohibited" categories in the Foreign Investment Industrial Guidance Catalogue last amended in 2015 (the "Foreign Investment Catalogue"), as well as certain items listed in the "encouraged" category in the Foreign Investment Catalogue that are subject to special requirements on equity and/or senior management. Please refer to the annexure hereto for a detailed list of all of such items. In other words, all the industries in the "permitted" category (i.e. industries that are not specifically listed in the Foreign Investment Catalogue) and the industries in the "encouraged" category that are not subject to any special requirements on equity and/or senior management fall outside of the National Negative List. Furthermore, Circular 22 makes it clear that foreign investors' acquisition of Chinese domestic companies shall be governed by the existing rules (i.e. the Provisions on Foreign Investors' Merger with and Acquisition of Domestic Enterprises last amended in 2009, and, where a listed company is involved, the Administrative Measures for Foreign Investors' Strategic Investment in Listed Companies promulgated in 2005 and last amended in 2015 shall apply).
Compared with the FTZ Negative List, the current National Negative List appears to be broader. For FIEs within the National Negative List, regardless of the investment amount or investment means (greenfield investment or merger and acquisitions), they shall continue to be subject to case-by-case approval administration.
According to NDRC, it will work with MOFCOM to amend the Foreign Investment Catalogue, with a view to "open up wider and create a more open and transparent investment environment"[1] .It appears that Circular 22 is just a transitional arrangement before a formal National Negative List is promulgated.
MOFCOM Measures
On 8 October 2016, MOFCOM issued the Interim Measures on Administration of Filing in respect of Establishment and Changes of Foreign-invested Enterprises (the "MOFCOM Measures"), setting forth detailed rules and procedures for the Filing Regime. Concurrently with the issuance of the MOFCOM Measures, MOFCOM also issued an official explanation in respect of the MOFCOM Measures on its website (the "MOFCOM Explanation").
Coverage of the Filing Regime
Compared with the Amendments, the MOFCOM Measures provide a longer list of matters which are subject to the Filing Regime, including:
- establishment of FIEs;
- change of basic corporate information of FIEs;
- change of basic corporate information of the investors of FIEs;
- change of equity interest or cooperative interest;
- merger, division, termination;
- transfer or mortgage of FIE's assets;
- early recovery of investment by foreign partners of a Sino-foreign cooperative joint venture enterprise;
- entrusted operation and management of a Sino-foreign cooperative joint venture enterprise.
Major differences between the old regime and the new regime
Some of the major differences between the old regime and the new regime are set out below[2]:
| old regime | new regime | |
|---|---|---|
| National Negative List |
Not applicable |
Applicable to FIEs nationwide |
| MOFCOM approval for FIE establishment |
Case-by-case approval |
FIEs on the National Negative List: - still subject to case-by-case approval |
| MOFCOM approval for certain FIE changes (e.g. increase or decrease of registered capital, equity transfer, merger, division, termination, etc.) |
Case-by-case approval |
FIEs on the National Negative List: - still subject to case-by-case approval FIEs outside of the National Negative List: - simple record-filing within 30 days after change |
| Processing time | 20 working days from acceptance of application |
FIEs on the National Negative List: FIEs outside of the National Negative List: |
| Impact on effectiveness of certain documents | The following documents shall become effective upon approval by MOFCOM: - joint venture contract - articles of association - equity transfer agreement |
FIEs on the National Negative List: FIEs outside of the National Negative List: |
| Disclosure of ultimate de facto controller[3] | Not required | Required |
A "true" filing system
According to the MOFCOM Explanation, unlike the former case-by-case approval which is in nature an administrative license, the Filing Regime implemented by the MOFCOM Measures is of an informative nature and is not a pre-requisite condition for an FIE to handle other formalities. MOFCOM will only make a formality examination of the information and documents filed by an FIE or its investor and it is the responsibility of the FIE or its investor to ensure the truthfulness, accuracy and completeness of the information filed.
Impact on existing FIEs
Existing FIEs do not need to undergo any formalities immediately to cater for the new regime. For an existing FIE which is on the National Negative List, the regulatory regime remains almost the same as before. For an existing FIE that falls outside of the National Negative List, it only needs to make a filing pursuant to the MOFCOM Measures when a certain change occurs, and its certificate of approval will expire at the same time when it completes the filing procedures.
SAIC Notice
On 30 September 2016, the State Administration for Industry and Commerce ("SAIC") issued the Notice of SAIC on Doing Good Work in Relation to Registration After the Implementation of Record-Filing Management of Foreign-invested Enterprises (the "SAIC Notice"). The SAIC Notice, echoing the aforementioned laws and rules, specifies that for foreign investments in industries outside of the National Negative List, the filing certificate issued by MOFCOM is not a pre-requisite condition for business registration. Local administrations for industry and commerce shall directly accept applications for registration of establishment or changes of an FIE outside of the National Negative List.
Final Remarks
Easier and quicker to set up FIEs not on the National Negative List
The current reform of China's foreign investment regulatory system is good news for foreign investors who wish to establish FIEs not on the National Negative List, as it means simpler documentation requirement, shorter timeframe and more certainty.
Easier and quicker to buy and sell equity interest in an FIE not on the National Negative List
For investors who wish to buy or sell equity interest in an FIE not on the National Negative List, this is welcome news too as MOFCOM approval is no longer required for such equity transfer, and they may be able to complete the transaction more quickly.
Furthermore, parties involved in a transaction for the sale and purchase of equity interest in an FIE not on the National Negative List may use certain deal mechanisms (for example, put/call option, drag-along/tag-along rights, and so on) more freely, as the equity transfer agreement in question is not required to be approved by MOFCOM in order to come into effect.
An important step in a radical reform
The Amendments is an important step in a radical reform of China's foreign investment regulatory regime, pending the promulgation of the PRC Foreign Investment Law, which is intended to replace all of the FIE Laws. A draft of the PRC Foreign Investment Law was published by MOFCOM to solicit public opinion on 19 January 2015 (the "Draft Foreign Investment Law"). The Draft Foreign Investment Law, if suddenly enacted and implemented in its entirety, could result in chaos in the administration and regulation of foreign investment. The Amendments, together with the aforementioned implementing rules, is a first step and effective move towards relaxing the regulatory control over foreign investments. So by the time the Foreign Investment Law is promulgated, certain changes may have already been put in place and worked in practice, and hence any shock to the system will be minimised.
Annexure
1. Items listed in the "restricted" category in the Foreign Investment Catalogue
| 1. 农作物新品种选育和种子生产（中方控股） |
1. Selection and cultivation of new varieties of crops, and production of seeds (with Chinese parties as the controlling shareholders) |
| 2. 特殊和稀缺煤类勘查、开采（中方控股） |
2. Exploration and mining of special and rare kinds of coal (with Chinese parties as the controlling shareholders) |
| 3. 贵金属（金、银、铂族）勘查、开采 |
3. Exploration and mining of noble metals (gold, silver and platinum group) |
| 4. 石墨勘查、开采 | 4. Exploration and mining of graphite |
| 5. 锂矿开采、选矿 | 5. Mining and mine selection of lithium mines |
| 6. 豆油、菜籽油、花生油、棉籽油、茶籽油、葵花籽油、棕榈油等食用油脂加工（中方控股），大米、面粉、原糖加工，玉米深加工 | 6. Processing of edible oils and fats from soybean, rapeseed, peanut, cottonseed, camellia seed, sunflower seed, palm (with Chinese parties as the controlling shareholders), processing of rice, flour and crude sugar, and deep processing of corn |
| 7. 生物液体燃料（燃料乙醇、生物柴油）生产（中方控股） | 7. Production of biological liquid fuels (fuel ethanol and biodiesel) (with Chinese parties as the controlling shareholders) |
| 8. 出版物印刷（中方控股） | 8. Printing of publications (with Chinese parties as the controlling shareholders) |
| 9. 钨、钼、锡（锡化合物除外）、锑（含氧化锑和硫化锑）等稀有金属冶炼 | 9. Smelting of rare metals including tungsten, molybdenum, tin (excluding tin compounds), antimony (including antimony oxides and antimony sulphides) |
| 10. 稀土冶炼、分离（限于合资、合作） | 10. Smelting and separation of rear earth (limited to Sino-foreign equity/cooperative joint venture operations) |
| 11. 汽车整车、专用汽车和摩托车制造：中方股比不低于50%，同一家外商可在国内建立两家（含两家）以下生产同类（乘用车类、商用车类、摩托车类）整车产品的合资企业，如与中方合资伙伴联合兼并国内其他汽车生产企业可不受两家的限制 | 11. Manufacturing of automobile whole vehicles, special use vehicles and motorcycles: Chinese parties shall hold at least 50% of the shares. One foreign investor may establish two or less equity joint ventures in the Mainland to manufacture the same category of whole vehicle products (i.e. the category of passenger cars, the category of commercial vehicles or the category of motorcycles), provided that the foregoing restrictions on the maximum of two joint ventures are not applicable if the same foreign investor engages in the merger of other domestic auto manufacturers jointly with its Chinese joint venture partners. |
| 12. 船舶（含分段）的修理、设计与制造（中方控股） | 12. Repair, design and manufacture of vessels (including sections) (with Chinese parties as the controlling shareholders) |
| 13. 卫星电视广播地面接收设施及关键件生产 | 13. Production of satellite telecasting ground receiving facilities and key components |
| 14. 小电网范围内，单机容量30万千瓦及以下燃煤凝汽火电站、单机容量10万千瓦及以下燃煤凝汽抽汽两用机组热电联产电站的建设、经营 | 14. Construction and operation of, in small grids, power plants using coal-fired and steam condensation thermal generator sets with a single generator capacity of 300,000 kilowatts or less, and thermoelectric power stations using coal-fired, steam condensation and extraction thermal generator sets with a single generator capacity of 100,000 kilowatts or less |
| 15. 城市人口50万以上的城市燃气、热力和供排水管网的建设、经营（中方控股） | 15. Construction and operation of pipeline networks for gas, heat, water supply and sewage in cities with the population over 0.5 million (with Chinese parties as the controlling shareholders) |
| 16. 铁路旅客运输公司（中方控股） | 16. Railway passenger transport companies (with Chinese parties as the controlling shareholders) |
| 17. 公路旅客运输公司 | 17. Highway passenger transport companies |
| 18. 水上运输公司（中方控股） | 18. Water transport companies (with Chinese parties as the controlling shareholders) |
| 19. 公务飞行、空中游览、摄影、探矿、工业等通用航空公司（中方控股） | 19. General aviation companies for business flights, air sight-seeing tours, photography, prospecting and industrial purposes (with Chinese parties as the controlling shareholders) |
| 20. 电信公司：增值电信业务（外资比例不超过50%，电子商务除外），基础电信业务（外资比例不超过49%） | 20. Telecommunications companies: value-added telecommunications services (with the proportion of foreign investment of not exceeding 50%, excluding e-commerce); basic telecommunications services (with the proportion of foreign capital of not exceeding 49%) |
| 21. 粮食收购，粮食、棉花批发，大型农产品批发市场建设、经营 | 21. Purchase of grains, wholesale of grains and cotton, and construction and operation of large-scale agricultural products wholesale markets |
| 22. 船舶代理（中方控股）、外轮理货（限于合资、合作） | 22. Vessel agencies (with Chinese parties as the controlling shareholders) and ocean shipping tally companies (limited to Sino-foreign equity/cooperative joint venture operations) |
| 23. 加油站（同一外国投资者设立超过30家分店、销售来自多个供应商的不同种类和品牌成品油的连锁加油站，由中方控股）建设、经营 | 23. Construction and operation of gas stations (in the case of those having established more than 30 chain gas stations funded by the same foreign investors and selling product oil of different varieties and brands from multiple suppliers, the Chinese parties shall be the controlling shareholders) |
| 24. 银行（单个境外金融机构及被其控制或共同控制的关联方作为发起人或战略投资者向单个中资商业银行投资入股比例不得超过20%，多个境外金融机构及被其控制或共同控制的关联方作为发起人或战略投资者投资入股比例合计不得超过25%，投资农村中小金融机构的境外金融机构必须是银行类金融机构） | 24. Banks (a single overseas financial institution and the affiliated parties under its control or joint control are only allowed to invest in not more than 20% of the shares of a single Chinese-funded commercial bank as promoters or strategic investors; multiple overseas financial institutions and the affiliated parties under their control or joint control are only allowed to invest in a total of not more than 25% of the shares of a single Chinese-funded commercial bank as promoters or strategic investors; and, overseas financial institutions investing in rural small and medium-sized financial institutions shall be banking financial institutions) |
| 25. 保险公司（寿险公司外资比例不超过50%） | 25. Insurance companies (in the case of life insurance companies, the proportion of foreign investment shall not exceed 50%) |
| 26. 证券公司（设立时限于从事人民币普通股、外资股和政府债券、公司债券的承销与保荐，外资股的经纪，政府债券、公司债券的经纪和自营；设立满2年后符合条件的公司可申请扩大业务范围；外资比例不超过49%）、证券投资基金管理公司（外资比例不超过49%） | 26. Securities companies (a securities company is limited to engaging in the underwriting and sponsorship of ordinary RMB-denominated shares, foreign shares, treasury bonds and corporate bonds, the brokerage of foreign shares, and the brokerage and proprietary trading of treasury bonds and corporate bonds upon establishment, and may apply for expanding its business scope two years after establishment if it satisfies relevant conditions. The proportion of foreign investment in a securities company shall not exceed 49%), and securities investment fund management companies (with the proportion of foreign investment of not exceeding 49%) |
| 27. 期货公司（中方控股） | 27. Futures companies (with Chinese parties as the controlling shareholders) |
| 28. 市场调查（限于合资、合作，其中广播电视收听、收视调查要求中方控股） | 28. Market investigations (limited to Sino-foreign equity/cooperative joint venture operations; specifically, Chinese parties shall be the controlling shareholders for survey of television and radio program ratings) |
| 29. 资信调查与评级服务公司 | 29. Credit investigation and rating service companies |
| 30. 测绘公司（中方控股） | 30. Surveying and mapping companies (with Chinese parties as the controlling shareholders) |
|
31. 高等教育机构（限于合作、中方主导） 中方主导是指校长或者主要行政负责人应当具有中国国籍，中外合作办学机构的理事会、董事会或者联合管理委员会的中方组成人员不得少于1/2（下同） |
31. Institutions of higher learning (limited to Sino-foreign cooperative joint venture operations led by Chinese parties) Being led by Chinese parties shall mean that the principal or major persons in charge of administrative matters of an institution of higher learning shall be of Chinese nationality, and that the Chinese members of the council, board of directors or joint management committee of an education institution run by Sino-foreign cooperation shall not be less than ½ (hereinafter the same). |
| 32. 普通高中教育机构（限于合作、中方主导） | 32. Ordinary senior high schools (limited to Sino-foreign cooperative joint venture operations led by Chinese parties) |
| 33. 学前教育机构（限于合作、中方主导） | 33. Pre-school education institutions (limited to Sino-foreign cooperative joint venture operations led by Chinese parties) |
| 34. 医疗机构（限于合资、合作） | 34. Medical institutions (limited to Sino-foreign equity/cooperative joint venture operations) |
| 35. 广播电视节目、电影的制作业务（限于合作） | 35. Production of radio and television programs and movies (limited to Sino-foreign cooperative joint venture operations) |
| 36. 电影院的建设、经营（中方控股） | 36. Construction and operation of cinemas (with Chinese parties as the controlling shareholders) |
| 37. 大型主题公园的建设、经营 | 37. Construction and operation of large theme parks |
| 38. 演出经纪机构（中方控股） | 38. Performance agency institutions (with Chinese parties as the controlling shareholders) |
2. Items listed in the "prohibited" category in the Foreign Investment Catalogue
| 1. 我国稀有和特有的珍贵优良品种的研发、养殖、种植以及相关繁殖材料的生产（包括种植业、畜牧业、水产业的优良基因） | 1. Research and development, breeding and planting of China's rare and special varieties, and production of relevant breeding materials (including quality genes in planting industry, husbandry and aquaculture) |
| 2. 农作物、种畜禽、水产苗种转基因品种选育及其转基因种子（苗）生产 | 2. Seed selection of the genetically modified varieties of crop seeds, breeding livestock and poultry, and aquatic fingerlings, and the production of their genetically modified seeds (seedlings) |
| 3. 我国管辖海域及内陆水域水产品捕捞 | 3. Fishing in the sea area and inland waters under China's jurisdiction |
| 4. 钨、钼、锡、锑、萤石勘查、开采 | 4. Exploration and mining of tungsten, molybdenum, tin, stibonium and fluorite |
| 5. 稀土勘查、开采、选矿 | 5. Exploration, mining and selection of rare earth elements |
| 6. 放射性矿产的勘查、开采、选矿 | 6. Exploration, mining and selection of radioactive minerals |
| 7. 列入《野生药材资源保护管理条例》和《中国稀有濒危保护植物名录》的中药材加工 | 7. Processing of traditional Chinese medicinal materials listed in the Regulations on the Administration for Protection of Wild Medicinal Resources and the Catalogue of China's Rare and Endangered Plants under Protection |
| 8. 中药饮片的蒸、炒、炙、煅等炮制技术的应用及中成药保密处方产品的生产 | 8. Application of such processing techniques as steaming, stir-frying, moxibustion, and calcination for making small pieces of ready-for-use traditional Chinese medicines; and production of traditional Chinese patent medicine of secret prescriptions |
| 9. 放射性矿产冶炼、加工，核燃料生产 | 9. Radioactive mineral smelting and processing, and nuclear fuel production |
| 10. 武器弹药制造 | 10. Manufacturing of weapons and ammunition |
| 11. 象牙雕刻 | 11. Ivory carving |
| 12. 虎骨加工 | 12. Tiger bone processing |
| 13. 宣纸、墨锭生产 | 13. Production of Xuan paper and Chinese ink ingot |
| 14. 大电网范围内，单机容量30万千瓦及以下燃煤凝汽火电站、单机容量20万千瓦及以下燃煤凝汽抽汽两用热电联产电站的建设、经营 | 14. Construction and operation of, within grand grids, power plants using coal-fired and steam condensation thermal generator sets with a single generator capacity of 300,000 kilowatts or less, and thermoelectric power stations using coal-fired, steam condensation and extraction thermal generator sets with a single generator capacity of 200,000 kilowatts or less |
| 15. 空中交通管制 | 15. Air traffic control |
| 16. 邮政公司、信件的国内快递业务 | 16. Postal companies; domestic express delivery business of mails |
| 17. 烟叶、卷烟、复烤烟叶及其他烟草制品的批发、零售 | 17. Wholesale and retail of tobacco leafs, cigarettes, re-dried tobacco leafs and other tobacco products |
| 18. 社会调查 | 18. Social investigations |
| 19. 中国法律事务咨询（提供有关中国法律环境影响的信息除外） | 19. Consulting on Chinese legal affairs (excluding the provision of information on the environmental impact of Chinese laws) |
| 20. 人体干细胞、基因诊断与治疗技术开发和应用 | 20. Development and application of human stem cell and genetic diagnosis and treatment technology |
| 21. 大地测量、海洋测绘、测绘航空摄影、行政区域界线测绘、地形图、世界政区地图、全国政区地图、省级及以下政区地图、全国性教学地图、地方性教学地图和真三维地图编制、导航电子地图编制，区域性的地质填图、矿产地质、地球物理、地球化学、水文地质、环境地质、地质灾害、遥感地质等调查 | 21. Geodetic surveying, marine charting, aerial photography for surveying and mapping purposes, administrative boundary surveying and mapping, compilation of topographic maps, maps of world political zones, national administrative divisions and administrative divisions at and below the provincial level, national teaching maps, local teaching maps and true three-dimensional maps, compilation of electronic maps for navigation purposes, regional geological mapping, mineral geology, geophysics, geochemistry, hydrogeology, environmental geology, geological disasters, geological remote sensing and other surveys |
| 22. 自然保护区和国际重要湿地的建设、经营 | 22. Construction and operation of natural reserves and internationally important wetlands |
| 23. 国家保护的原产于我国的野生动、植物资源开发 | 23. Development of wild animal and plant resources originated in and protected by China |
| 24. 义务教育机构，军事、警察、政治和党校等特殊领域教育机构 | 24. Compulsory education institutions, education institutions in military affairs, police, politics and other special fields, and Party schools |
| 25. 新闻机构 | 25. News agencies |
| 26. 图书、报纸、期刊的出版业务 | 26. Publishing of books, newspapers, and periodicals |
| 27. 音像制品和电子出版物的出版、制作业务 | 27. Publishing and production of audio-visual products and electronic publications |
| 28. 各级广播电台（站）、电视台（站）、广播电视频道（率）、广播电视传输覆盖网（发射台、转播台、广播电视卫星、卫星上行站、卫星收转站、微波站、监测台、有线广播电视传输覆盖网） | 28. All radio stations, television stations, radio and television channels (frequencies), radio and television transmission and coverage networks (transmitting stations, relay stations, radio and television satellites, satellite uplink stations, satellite receiving and transmitting stations, microwave stations, monitoring stations, and cable radio and television transmission and coverage networks) |
| 29. 广播电视节目制作经营公司 | 29. Radio and television program production and operating companies |
| 30. 电影制作公司、发行公司、院线公司 | 30. Movie production companies, distribution companies and cinema companies |
| 31. 新闻网站、网络出版服务、网络视听节目服务、互联网上网服务营业场所、互联网文化经营（音乐除外） | 31. Operation of news websites, online publication services, online audio and video program streaming services, business premises for Internet access services, and Internet cultural business (excluding music) |
| 32. 经营文物拍卖的拍卖企业、文物商店 | 32. Auction houses and cultural relics shops engaging in the auction of cultural relics |
| 33. 高尔夫球场、别墅的建设 | 33. Construction of golf courses and villas |
| 34. 危害军事设施安全和使用效能的项目 | 34. Projects endangering the safety and performance of military facilities |
| 35. 博彩业（含赌博类跑马场） | 35. Gambling and lottery industry (including horse race tracks for gambling purposes) |
| 36. 色情业 | 36. Pornography industry |
3. Items listed in the "encouraged" category in the Foreign Investment Catalogue that subject to special requirements on equity and/or senior management
| 11. 石油、天然气（含油页岩、油砂、页岩气、煤层气等非常规油气）的勘探、开发和矿井瓦斯利用（限于合资、合作） | 11. Exploration and exploitation of oil and natural gas (including oil shale, oil sands, shale gas, coal-bed methane and other unconventional oil and gas), and utilization of mine gas (limited to Sino-foreign equity/cooperative joint venture operations) |
| 206. 汽车电子装置制造与研发：汽车电子总线网络技（限于合资），电动助力转向系统电子控制器（限于合资） | 206. Manufacture and research & development of automobile electronic devices: automobile electronic bus network technologies (limited to Sino-foreign equity joint venture operations); electronic controllers for electric power steering system (limited to Sino-foreign equity joint venture operations) |
| 209. 轨道交通运输设备（限于合资、合作） | 209. Track transportation equipment (limited to Sino-foreign equity/cooperative joint venture operations) |
| 210. ���用飞机设计、制造与维修：干线、支线飞机（中方控股），通用飞机（限于合资、合作） | 210. Design, manufacture and maintenance of civil aircrafts: aircrafts for trunk lines, regional aircrafts (with Chinese parties as the controlling shareholders), and general aircrafts (limited to Sino-foreign equity/cooperative joint venture operations) |
| 212. 民用直升机设计与制造（3吨级及以上需中方控股） | 212. Design and manufacture of civil helicopters: those of three tons or more (with Chinese parties as the controlling shareholders) |
| 214. 地面、水面效应飞机制造及无人机、浮空器设计与制造（中方控股） | 214. Manufacturing of ground-effect and water-effect aircrafts, and design and manufacturing of UAV and aerostats (with Chinese parties as the controlling shareholders) |
| 221. 海洋工程装备（含模块）的制造与修理（中方控股） | 221. Manufacture and repair of marine engineering equipment (including modules) (with Chinese parties as the controlling shareholders) |
| 223.船舶低、中速柴油机及曲轴的制造（中方控股） | 223. Manufacture of low and medium-speed diesel engines of vessels and bent axle (with the Chinese Parties holding majority of the shares) |
| 261. 民用卫星设计与制造、民用卫星有效载荷制造 （中方控股） | 261. Design and manufacture of civil satellites, and manufacture of civil satellite payloads (with Chinese parties as the controlling shareholders) |
| 293. 核电站的建设、经营（中方控股） | 293. Construction and operation of nuclear power stations (with Chinese parties as the controlling shareholders) |
| 295. 电网的建设、经营（中方控股） | 295. Construction and operation of power grids (with Chinese parties as the controlling shareholders) |
| 301. 铁路干线路网的建设、经营（中方控股） | 301. Construction and operation of network of trunk railway lines (with Chinese parties as the controlling shareholders) |
| 307. 民用机场的建设、经营（中方相对控股） | 307. Construction and operation of civil airports (with the Chinese Parties holding a relative majority of the shares) |
| 308. 航空运输公司（中方控股，且一家外商及其关联企业投资比例不得超过25%） | 308. Air transportation companies (with Chinese parties as the controlling shareholders, and the investment of a single foreign investor and its affiliated enterprises not exceeding 25%) |
| 309. 农、林、渔业通用航空公司（限于合资、合作） | 309. General airline companies for agriculture, forestry, and fishery (limited to Sino-foreign equity/cooperative joint venture operations) |
| 310. 定期、不定期国际海上运输业务（限于合资、合作） | 310. Scheduled or non-scheduled international marine transportation services (limited to Sino-foreign equity/cooperative joint venture operations) |
| 318. 会计、审计（首席合伙人需具有中国国籍） | 318. Accounting and auditing (the chief partner shall be of Chinese nationality) |
| 341. 综合水利枢纽的建设、经营（中方控股） | 341. Construction and operation of comprehensive water control projects (with Chinese parties as the controlling shareholders |
1. See http://www.sdpc.gov.cn/gzdt/201610/t20161008_821985.html
2. FIEs in the four free trade zones are not taken into account for the purpose of this comparison.
3. According to the MOFCOM Explanation, the ultimate de facto controller is, in respect of an FIE, a natural person, enterprise, government agency or international organization that has ultimate direct or indirect control over that FIE by way of equity, contract, trust or other means; and, in respect of an investor of an FIE, a natural person, enterprise, government agency or international organization that has ultimate direct or indirect control over that investor by way of equity, contract, trust or other means. Where the aforementioned de facto controller is an overseas entity, it shall be chased up to an overseas listed company, a foreign natural person, a foreign government agency (including governmental fund) or an international organization; where the de facto controller is a Chinese entity, it shall be chased up to a domestic listed company, a domestic natural person or a State-owned/collectively-owned enterprise.
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