Laws of the People's Republic of China

The State Administration for Industry and Commerce

Reply of the State Administration for Industry and Commerce on the Retroactivity and Objects of Application of the Revised Implementing Rules of the People's Republic of China for Business Entity Registration Administration

GongShangQiZi [1998] No.138

July 7, 1998

Hunan Administration for Industry and Commerce:

We have studied your Request for Instructions dated April 20, 1998 on the Retroactivity and Objects of Application of the Revised Implementing Rules of the People's Republic of China for Business Entity Registration Administration (XiangGongShangFaZi[1998]No.64) and now reply as follows:

I.

As for behaviors on the part of enterprises and operating units in violation of enterprise registration administration prior to December 25, 1996, competent registration administration authorities should conduct punishments in accordance with the previous unrevised version of the Implementing Rules of the People's Republic of China for Controlling the Registration of Enterprises as Legal Persons.

II.

As for behaviors of fake investment and withdrawal of registered capital on the part of enterprises with foreign investment, competent registration administration authorities should first conduct punishment in accordance with the Regulations of the People's Republic of China for Controlling the Registration of Enterprises as Legal Persons and its Implementing Rules, as provided for in Article 15 of the Implementing Opinions on Related Issues of the Application of Regulations on Company Registration Administration for Registration Administration of Enterprises with Foreign Investment of the State Administration for Industry and Commerce (GongShangQiZi [1995] No.177).

III.

Contracting parties of Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures should be handled in accordance with the Provisions on Investment Appropriation of Contracting Parties of Chinese-foreign equity joint ventures approved by the State Council for failures to appropriate due investment. Enterprises with foreign investment should be handled in accordance with Articles 31 and 32 of the Implementing Rules of the Law of the People's Republic of China on Foreign-capital Enterprises for failures to appropriate due investment.