Laws of the People's Republic of China

The State Administration for Industry and Commerce

Circular of the State Administration for Industry and Commerce Concerning the Opinions on Handling Disputes over Stock Equity of Enterprises with Foreign Investment

GongShangWaiQiZi [2002] No.38

February 20, 2002

The administrations for industry and commerce of all provinces, autonomous regions and municipalities directly under the Central Government and the administrations for industry and commerce of the authorized cities:

Recently, the State Administration for Industry and Commerce has continually received complaints and reports on disputes over stock equity of enterprises with foreign investment. The opinions on handling the relevant issues are hereby put forward as follows:

1.

Based on the existing laws and regulations, an enterprise with foreign investment shall be confirmed according to the status of its investors, source of fund, the proportion of the foreign fund and the industry policies, and shall be established according to legal procedures.

2.

Where a dispute over the investment ownership of enterprise with foreign investment arises between the relevant parties and reconfirmation is needed, the legal procedures for examination and approval and the legal procedures for examination and approval for alteration shall be gone through, according to the actual contribution of investment and upon the unanimous agreement of the parties or after the judicial or arbitration organs confirm the ownership according to law.

3.

The relevant parties that provide false documents and cheat to obtain the registration during the process of examination, approval and registration shall bear the corresponding legal liabilities.