[Home] [Databases] [WorldLII] [Search] [Feedback] Laws of the People's Republic of China

You are here:  AsianLII >> Databases >> Laws of the People's Republic of China >> CIRCULAR OF THE STATE COUNCIL REGARDING THE FURTHER OPENING OF NANNING, KUNMING, PINGXIANG AND OTHER FOUR BORDER CITIES (OR COUNTIES OR TOWNS)

[Database Search] [Name Search] [Noteup] [Help]

CIRCULAR OF THE STATE COUNCIL REGARDING THE FURTHER OPENING OF NANNING, KUNMING, PINGXIANG AND OTHER FOUR BORDER CITIES (OR COUNTIES OR TOWNS)

    1. The policies for costal open cities shall be implemented in the cities
of Nanning and Kunming.

    2. The following policies shall be implemented in some cities (or counties
or towns)--Pingxiang, Dongxing, Wanting, Ruili, and Hekou:

    (1) Border trade and economic cooperation with foreign companies shall
be carried out in accordance with relevant regulations approved by the State
Council. The people's governments of Guangxi Zhuang Autonomous Region and
Yunnan Province within the limit of their authority, may grant certain
authority to the governments of the five cities (or counties or towns)
concerning the administration of border trade and economic cooperation so
that they may have the right to examine and approve some economic contracts
concerning border trade, product processing, and labor service cooperation
without asking a superior department for instructions. The five cities (or
counties or towns) may, with the approval of the Ministry of Foreign Trade
and Economic Cooperation, increase the number of companies dealing with border
trade by one or two.      

    (2) The development of processing trades and foreign-exchange-earning
agriculture shall be encouraged in these regions. During the Eighth Five-Year
Plan period, the five cities (or counties or towns) shall be exempt from
import duties and product taxes (value-added taxes) for imported seeds, seed
plants, breeding stocks, fodder, related technical equipment for developing
the export of agricultural products, and imported machinery and other
materials for processing and export of agricultural products and for
technological reform of enterprises.

    (3) Both domestic and foreign investment should be actively absorbed to
promote development of the economy. The governments of Guangxi Zhuang
Autonomous Region and Yunnan Province, within the limit of their authority,
may extend the authority of the governments of the five cities (or counties or
towns) to examine and approve foreign-funded projects. Income taxes shall be
levied on foreign-funded enterprises in the five cities (or counties or towns)
at a reduced rate of 24 percent.

    (4) Investors from neighboring countries may include the means of
production or other materials and equipment in the total amount of their
investment. These goods may be sold in accordance with the regulations
concerned, and the import duties and the consolidated industrial and
commercial tax shall be reduced by half.

    (5) Qualified cities (or counties or towns) are allowed to establish
border economic cooperation zones, and set up export-oriented processing
enterprises and relevant tertiaries. The specific scope of border economic
cooperation zones shall be examined and approved by the Special Economic
Zones Office of the State Council in conjunction with relevant departments.
The imported machines, equipment, and other materials, as well as office
articles within a reasonable quantity, so long as they are used for
infrastructure construction of border economic cooperation zones, shall be
exempt from import duties and product taxes (value-added taxes). During the
Eighth Five-Year Plan period, the newly-earned financial income of the
economic cooperation zones should be reserved for the construction of local
infrastructure.

    (6) If the scale of production and export of export-oriented productive
enterprises which have links with the inland areas in the border economic
cooperation zones reaches a certain volume, they shall be granted the right
to import from and export to the neighboring countries with the approval of
the Ministry of Foreign Trade and Economic Cooperation. The income taxes of
the inland-associated enterprises shall be levied at a reduced rate of 24
percent supposing the profits remain in the locality, but an additional amount
of nine percent shall be collected by the region in which the inland investors
are if they transfer the profits to inland areas. Until the end of the Eighth
Five-Year Plan period, the above-mentioned enterprises shall be exempt from
regulation tax on investment orientation.

    (7) The commodities received through barter by inland-associated
enterprises and foreign-funded enterprises in the border economic cooperation
zones may be sold by enterprises themselves, and import duties and
consolidated industrial and commercial tax shall be reduced by half for these
commodities. For importing commodities on which the state has placed
restrictions, the formalities of import examination and approval should be
handled in accordance with the relevant regulations of the state.

    (8) The state shall grant appropriate subsidies to assist construction of
customs and other port facilities in these five cities (or counties or towns).
The specific amount and means of subsidization shall be appraised and decided
by the Ministry of Finance.

    The five cities (or counties or towns) are allowed to collect managerial
fees (0.6 yuan/ton) on goods passing through the ports. These fees shall be
used for maintenance and construction of the port facilities and cities.

    (9) Every year during the Eighth Five-Year Plan period, the People's Bank
shall allocate to Wanting and Ruili 10 million yuan each, and to Pingxiang,
Dongxing, and Hekou 20 million yuan each as credit for fixed assets. These
allocations shall be used for the construction of the border cities and the
border economic cooperation zones and shall be included in the state's credit
and investment plan.

    (10) From this year to the end of the Eighth Five-Year Plan period, each
of the five cities (or counties or towns) shall be allowed to import 30 items
of transportation for their own use, which shall be exempt from import duties,
value-added taxes and special consumption taxes. These vehicles are to be used
only within the local region, and resale or conveyance outside is forbidden.
This shall be strictly supervised by the local customs offices. The authority
to check and issue import licences shall be granted to the department of
economy and trade of the Guangxi Zhuang Autonomous Region and Yunnan Province.

    (11) Investment and establishment of overseas enterprises in peripheral
countries shall be permitted. According to Document No.13 issued by the State
Council in 1991, the projects with a total investment volume below US$1
million shall be examined and approved by the Guangxi Zhuang Autonomous Region
and Yunnan Province, and licences shall be issued after authority is granted
by the Ministry of Foreign Trade and Economic Cooperation.

    The governments of the Guangxi Zhuang Autonomous Region and the Yunnan
Province should reinforce their leading role over the further-opened cities
and border towns and help them make overall plans for construction and
development. The scale of construction for land development should be suited
to the practical conditions of the localities. While expanding opening up and
speeding up economic construction, the two regions should strengthen
construction of the legal system and socialist spiritual civilization, tighten
macro-control over the economy, take strong measures against crimes such as
smuggling and narcotics trafficking so as to guarantee the security and
stability of the borders and the sound development of all undertakings.