Approved by the State
Council on September 2,1997 and promulgated by Decree [1997] No.2
of the Ministry of Foreign Trade and Economic Cooperation and the
State Administration for Industry and Commerce
In order to strengthen the administration of investment contributions
made by investors of foreign investment enterprises (including those
foreign investment enterprises established by purchasing assets or
stocks of internal enterprises), these Supplementary Provisions are
hereby formulated as follows to the Several Provisions Concerning
the Investment Made by the Various Parties to Chinese-foreign Equity
Joint Ventures.
1. Any foreign investor who establishes a foreign investment enterprise
by purchasing assets or stocks of an internal enterprise(s) shall
pay fully purchasing charges within three months as of the date the
business licence of the said foreign investment enterprise is issued.
If extension of payment is required due to special circumstances,
after approval by the examining and approving authorities, more than
60% of the total amount of the purchasing charges shall be paid within
six months as of the date the business licence is issued, and within
one year the total amount shall be paid up; the distribution of profit
shall be made in proportion as the actual payment of investment contributions.
Unless the total amount of the purchasing charges has been paid up,
any holding investor may not have the enterprise's decision-making
power, nor he may in the form of a combination statement incorporate
rights and interests or assets of the said enterprise into his accounting
statement.
2. Investors in a Chinese-foreign equity joint venture must simultaneously
pay up their respective investment contributions according to the
percentage and deadline stipulated in the contract. If any of them
cannot do so, the case shall be reported to the original examining
and approving authorities for approval and the distribution of profit
be made according to the percentage of the actual payment of his investment
contributions. With regard to the holding (including relatively holding)
investor in a Chinese-foreign equity joint venture, before the actual
payment of his investment contributions attains his total amount of
his subscribed payment, he shall not obtain the enterprise's decision-making
power, nor he can in the form of a combination statement incorporate
rights and interests or assets of the said enterprise into his accounting
statement.
3. Chinese-foreign contractual joint ventures and solely foreign invested
enterprises shall be handled with reference with these Provisions.
Promulgated by The Ministry of Foreign Trade and Economic Cooperation,
the State Administration for Industry and Commerce on 1997-9-29 |
