Thursday 12 March 2009

Beijing eases FDI rules, makes approvals easier

Under the new rules, normal merger deals with a price tag below US$100 million only need approval from local commerce authorities, rather than the Ministry of Commerce in Beijing.

1 comment:

Guanyu said...

Beijing eases FDI rules, makes approvals easier

Reuters in Beijing
12 March 2009

Beijing has devolved authority for approving more foreign investment projects to local authorities, making it easier for foreign investors to set up shop in mainland, according to new rules published on Thursday.

The easing in regulations comes amid a slowdown in inflows of foreign direct investment (FDI). Mainland drew US$7.54 billion in FDI in January, the fourth straight month of decline from year-earlier levels.

Under the new rules, normal merger deals with a price tag below US$100 million only need approval from local commerce authorities, rather than the Ministry of Commerce in Beijing.

For foreign investors intending to start business in sectors that mainland wants to develop, they can go to the local commerce bureau for approval. Previously they had to run their plans through Beijing.

The relaxed rules, which came into effect on March 5, are aimed at “boosting domestic demand and promoting stable but rapid economic growth”, the Ministry of Commerce said on its website.

Another relaxation in the rules is that foreign-funded automobile makers no longer have to apply to the Ministry of Commerce for permission to broaden their production - they only need to notify local authorities when producing new models or increasing capacity.

Commerce Minister Chen Deming said on Tuesday that the ministry plans to review and adjust its foreign investment policies to lure more investment.