Provisions on the Administration of Foreign-funded Telecommunications Enterprises (2016 Revision)

Provisions on the Administration of Foreign-funded Telecommunications Enterprises (2016 Revision) Provisions on the Administration of Foreign-funded Telecommunications Enterprises (Issued by Order No. 333 of the State Council of the People's Republic of China on December 11, 2001, amended for the first time according to the Decision of the State Council on Amending the Provisions on the Administration of Foreign-funded Telecommunications Enterprises on September 10, 2008 (Order No. 534 of the State Council of the People's Republic of China) and amended for the second time according to the Decision of the State Council on Amending Certain Administrative Regulations on February 6, 2016 (Order No. 666 of the State Council of the People's Republic of China)) Article 1 The present Provisions have been formulated according to relevant laws and administrative regulations concerning foreign investment and the Telecommunications Regulation of the People's Republic of China for the purpose of satisfying the demand of opening the telecommunications industry to the outside world and promoting the development of the telecommunications industry. Article 2 A foreign-funded telecom enterprise is one established by foreign investors and Chinese investors within the territory of the People's Republic of China by way of a sino-foreign equity joint venture for engagement in the telecom services. Article 3 Foreign-funded telecom enterprises shall, apart from observing the present Provisions in their telecom business activities, abide by the provisions of the Telecommunications Regulation and other relevant laws and administrative regulations. Article 4 Foreign-funded telecom enterprises may be engaged in the basic telecom services and value-added services, the specific business classifications shall be implemented according to the provisions of the Telecommunications Regulation. The geographical areas in which foreign-funded telecom enterprises may do business shall be provided by the administrative department of industry and information technology under the State Council according to relevant provisions. Article 5 The foreign-funded telecom enterprise shall meet the following provisions in terms of their registered capital: 1.If the enterprises is engaged in the basic telecom business nationwide or beyond a single province, autonomous region or municipality directly under the Central Government, it shall have a registered capital of not less than 1 billion yuan. If it is engaged in the value-added telecom businesses, it shall have a registered capital of not less than 10 million yuan; 2.If the enterprise is engaged in the basic telecom business within a province, autonomous region or municipality directly under the Central Government, it shall have a registered capital of not less than 100 million yuan. If it is engaged in the value-added businesses, it shall have a registered capital of not less than 1 million yuan; Article 6 The ultimate proportion of contribution of the foreign investors of a foreign-funded telecom enterprise that is engaged in the basic telecom services (except the radio paging services) shall not be more than 49%. The ultimate proportion of contribution of the foreign investors of a foreign-funded telecom enterprise that is engaged in the value-added services (including the radio paging business in the basic telecom services) shall not be more than 50%. The different proportions of contribution of the Chinese and foreign investors in a foreign-funded telecom enterprise at different stages shall be determined by the administrative department of industry and information technology under the State Council according to relevant provisions. Article 7 In order to engage in the telecom businesses, a foreign-funded telecom enterprise shall not only meet the conditions as mentioned in Articles 4, 5 and 6 of the present Provisions but also those as provided in the Telecommunications Regulation for engaging in the basic telecom businesses and value-added telecom businesses. Article 8 The major Chinese investor of a foreign-funded telecom enterprise that is engaged in the basic telecom businesses shall meet the conditions as mentioned below: 1.It is a legally established company; 2.It has capitals and a staff that suit its business operations; 3.It satisfies the requirements of the administrative department of industry and information technology under the State Council for discreet and special industries. The term “major Chinese investor in a foreign-funded telecom enterprise” as mentioned in the preceding paragraph shall be the investor that makes the largest contribution among all the Chinese investors and has a share of over 30% of the total investment made by all the Chinese investors. Article 9 The major foreign investor of a foreign-fu......