Law of the People's Republic of China on Wholly Foreign-owned Enterprises (Amended in 2000)

Law of the People's Republic of China on Wholly Foreign-owned Enterprises (Amended in 2000)

Order of the President of the People's Republic of China No. 41

October 31, 2000

Adopted at the 4th Session of the 6th National People's Congress on April 12, 1986 and amended according to the Decision on Revising the Wholly Foreign-owned Enterprise Law made at the 18th Session of the Standing Committee of the 9th National People's Congress on October 31, 2000.

Article 1 In order to expand foreign economic cooperation and technological exchange, and promote the development of the Chinese economy, the People's Republic of China permits foreign enterprises and other economic organizations or individuals (hereinafter referred to as "foreign investors") to establish wholly foreign-owned enterprises within the territory of the People's Republic of China, and shall protect the lawful rights and interests of such enterprises.

Article 2 The term "wholly foreign-owned enterprise" as used in this Law refer to any enterprise established within the territory of the People's Republic of China in accordance with applicable Chinese laws with capital provided solely by a foreign investor, but does not include any branch established in China by a foreign enterprise or other economic organization.

Article 3 Wholly foreign-owned enterprises must benefit the development of the Chinese economy. The State encourages the establishment of wholly foreign-owned enterprises that export commodities or that are technologically advanced.
The State Council is to provide for industries in which the establishment of wholly foreign-owned enterprises is prohibited or restricted.

Article 4 The investments, profits and other legitimate rights and interests of foreign investors in China are protected by Chinese law.
Foreign investors must obey Chinese laws and regulations, and shall not harm the public interest of China.

Article 5 The State is not to nationalize, or expropriate the assets of, wholly foreign-owned enterprises.
　　......