Administration of Foreign-invested Urban Planning Services Enterprises Provisions

(Promulgated by the Ministry of Construction and the Ministry of Foreign Trade and Economic Cooperation on February 13 2003 and effective as of May 1 2003.)

Article 1: These Provisions are formulated in order to further open up to the outside world, to regulate investment in urban planning services enterprises by foreign companies, enterprises and other economic organizations or individuals and to strengthen the administration of urban planning service activities conducted by foreign-invested urban planning services enterprises in accordance with the PRC Wholly Foreign-owned Enterprise Law, the PRC Sino-foreign Equity Joint Venture Law, the PRC Sino-foreign Cooperative Joint Venture Law and the PRC Urban Planning Law.

Article 2: These Provisions are applicable to the establishment of foreign-invested urban planning services enterprises within the People's Republic of China, the application for Urban Planning Services Qualification Certificate for Foreign-invested Enterprises and to the supervision and administration of foreign-invested urban planning services enterprises.

Article 3: For the purposes of these Provisions, the term "foreign-invested urban planning services enterprises" means Sino-foreign equity joint ventures, Sino-foreign cooperative joint ventures and wholly foreign-owned enterprises that are established according to the laws of the People's Republic of China and that engage in urban planning services.

For the purposes of these Provisions, the term "urban planning services" means to engage in the formulation of urban plans and urban plan consulting activities in connection with any urban planning other than overall planning.

Article 4: A foreign company, enterprise and other economic organization or individual that engages in urban planning services shall establish a Sino-foreign equity joint venture, a Sino-foreign cooperative joint venture or a wholly foreign-owned enterprise according to law and obtain an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises.

No urban planning services shall be conducted without obtaining an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises.

Article 5: The State Council administrative department in charge of foreign trade and economic cooperation shall be responsible for the administration of the establishment of foreign-invested urban planning services enterprises; the State Council administrative department in charge of construction shall be responsible for the administration of the qualifications of foreign-invested urban planning services enterprises.

The administrative department in charge of foreign trade and economic cooperation of the people's government of the province, autonomous region or municipality directly under the central government shall be responsible for the preliminary examination of the establishment of foreign-invested urban planning services enterprises within their own local administrative regions; the administrative department in charge of urban planning of the people's government at or above the county level shall be responsible for the supervision and administration of the urban planning services activities conducted by foreign-invested urban planning services enterprises within their own local administrative regions.

Article 6: Apart from satisfying the conditions of Chinese laws and regulations governing foreign-invested enterprises, the establishment of foreign-invested urban planning services enterprises shall also be subject to the following conditions:

1. the foreign party is an enterprise that, or a professional technician who, engages in urban planning services in its or his home country or region;

2. the number of professional technicians who are experienced in the areas of urban planning, construction, road transportation, landscaping and related engineering projects shall be at least 20, of which foreign professional technicians shall constitute no less than 25% of the total number of professional technicians, and there shall be at least one foreign professional technician specializing in the areas of urban planning, construction, road transportation and landscaping, respectively; and

3. it shall have in place technical equipment and a permanent workplace that are both in compliance with State standards.

Article 7: When applying for the establishment of a foreign-invested urban planning services enterprise, an application for verification and approval of the name of the proposed foreign-invested urban planning services enterprise shall be submitted to the State Administration for Industry and Commerce or the local administration for industry and commerce authorized by the State Administration for Industry and Commerce according to law.

Article 8: After obtaining the verification and approval of the name of the proposed foreign-invested urban planning services enterprise, the applicant shall apply for the establishment of the foreign-invested urban planning services enterprise with and submit the following materials to the administrative department in charge of foreign trade and economic cooperation of the people's government of the province, autonomous region or municipality directly under the central government in which the proposed enterprise is to be located:

1. the application form for the establishment of a foreign-invested enterprise signed by the legal representatives of the investors;

2. the feasibility study, project proposal and proposal on the establishment of the enterprise (including staffing of professionals, the technology and equipment plan and the area of the working premises, etc.) that have been prepared or approved by the investors;

3. the contracts and articles of association in respect of the foreign-invested enterprise that have been signed by the legal representatives of the investors (in the case of a wholly foreign-owned enterprise, only articles of association are required);

4. the notice on the preliminary verification and approval of the name of the enterprise;

5. the legal person registration certificates of the investors and certificates of creditworthiness issued by the banks of the investors;

6. documents relating to the investors' proposed appointment of the chairman, members of the board of directors, manager, responsible persons for engineering and technology, etc. and the documentary evidence relating thereto;

7. the balance sheets and profit and loss statements of the investors, which have been audited by certified accountants or accounting firms, for the most recent three years;

8. the enterprise registration certificate of the foreign party for engaging in urban planning services in the country or region where it is located and a certificate of creditworthiness issued by the bank in relation thereto; and

9. evidence showing the experience and track record of the foreign investor in respect of urban planning services issued by the department in charge or the industry association, society or notary institution of the country or region in which the foreign investor is located.

Article 9: The administrative department in charge of foreign trade and economic cooperation of the people's government of the province, autonomous region or municipality directly under the central government shall complete the preliminary examination within 30 days after the date of accepting the application. After preliminary examination approval, such application shall be submitted to the State Council administrative department in charge of foreign trade and economic cooperation.

Article 10: The State Council administrative department in charge of foreign trade and economic cooperation shall, within 10 days from the date of receiving the preliminarily approved application materials, forward such application materials to the State Council administrative department in charge of construction for comment. The State Council administrative department in charge of construction shall, within 30 days from the date of receiving the application materials, issue its comments. The State Council administrative department in charge of foreign trade and economic cooperation shall, within 30 days from the date of receiving the written opinion issued by the State Council administrative department in charge of construction, determine whether to approve or reject the application. If approval is granted, it shall issue the Foreign-invested Enterprise Approval Certificate; if the application is rejected, it shall provide a written explanation.

Article 11: After obtaining the Foreign-invested Enterprise Approval Certificate, the applicant shall complete the industry and commerce registration formalities and obtain a business licence.

Article 12: After obtaining a business licence, the applicant shall apply for an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises with the State Council administrative department in charge of construction.

Article 13: The following materials shall be submitted when applying for an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises:

1. the application form for the Urban Planning Services Qualification Certificate for Foreign-invested Enterprises;

2. the Foreign-invested Enterprise Approval Certificate;

3. the Enterprise Legal Person Business Licence;

4. employment contracts made with the professional technicians and materials evidencing the qualifications of the professional technicians, both of which have been filed at the department of labour and personnel for the record; and

5. materials relating to technology and equipment possessed by the enterprise.

Article 14: Foreign-invested urban planning services enterprises shall, within 30 days after obtaining their Urban Planning Services Qualification Certificates for Foreign-invested Enterprises, file with the administrative departments in charge of urban planning of the cities or provinces in which they are registered for the record.

Article 15: If a foreign-invested urban planning services enterprise contracts for the provision of urban planning services outside its place of registration, it shall file with the administrative department in charge of urban planning of the city or province in which the urban planning services are provided for the record.

Article 16: All materials submitted by the applicant shall be in Chinese. If the documentary evidence is in a foreign language, a Chinese translation shall be provided.

Article 17: Foreign-invested urban planning services enterprises engaging in urban planning services shall be subject to the laws, regulations, technical standards and specifications of China relating to urban planning.

Article 18: Each of the foreign professional technicians employed by the foreign-invested urban planning services enterprise shall stay in China for a period of no less than six months in total each year.

Article 19: The State Council administrative department in charge of construction shall conduct an annual inspection of foreign-invested urban planning services enterprises that have obtained an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises. If the foreign-invested urban planning services enterprise does not meet the qualification conditions, its Urban Planning Services Qualification Certificate for Foreign-invested Enterprises shall be revoked.

Article 20: A Chinese party that has obtained the Urban Planning Formulation Work Unit Qualification Certificate and establishes a Sino-foreign urban planning services equity joint venture or a Sino-foreign urban planning services cooperative joint venture by way of reorganization or changing its corporate form shall return its Urban Planning Formulation Work Unit Qualification Certificate.

Article 21: Upon the cessation of business, the foreign-invested urban planning services enterprise shall return its Urban Planning Services Qualification Certificate for Foreign-invested Enterprises.

Article 22: Contracting out of urban planning services to foreign-invested enterprises that have not obtained an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises is strictly prohibited.

Contracting out of overall urban planning services to any foreign-invested enterprise is strictly prohibited.

Article 23: If a foreign-invested urban planning services enterprise without an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises contracts for the provision of urban planning services, the administrative department in charge of urban planning of the local people's government at or above the county level shall order the cessation of such unlawful activity and impose a fine of no less than Rmb10,000 and no more than Rmb30,000. The relevant department shall reject approval of the results generated therefrom.

Article 24: If the foreign-invested urban planning services enterprise violates the provisions hereof by engaging in overall urban plan formulation, the administrative department in charge of urban planning of the local people's government at or above the county level shall order rectification of the situation; if the circumstance is serious, the Urban Planning Services Qualification Certificate for Foreign-invested Enterprises shall be revoked by the certificate issuing authority.

If the foreign-invested urban planning services enterprise obtains an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises by fraud or deception, the Urban Planning Services Qualification Certificate for Foreign-invested Enterprises shall be revoked by the certificate issuing authority.

After the forfeiture of the Urban Planning Services Qualification Certificate for Foreign-invested Enterprises, the issuing authority shall report the relevant situation to the registration authority. An enterprise whose qualification certificate has been revoked shall cancel its registration with the registration authority; if such enterprise fails to complete the formalities for cancellation of registration, the registration authority shall handle the formalities according to law.

Article 25: In the event that urban planning services are contracted out to a foreign-invested enterprise that has not obtained an Urban Planning Services Qualification Certificate for Foreign-invested Enterprises or overall planning services are contracted out to a foreign-invested urban planning services enterprise in violation of these Provisions, the said violation shall be rectified by the authority at a higher level and administrative liability shall be pursued against the relevant responsible persons according to law; if the violation constitutes a criminal offence, criminal liability shall be pursued according to law.

Article 26: The State Council administrative department in charge of construction and the State Council administrative department in charge of foreign trade and economic cooperation shall be responsible for the interpretation of these Provisions in accordance with their respective functions.

Article 27: The establishment of enterprises for urban planning services invested by investors from the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan region in the Mainland shall be handled with reference to these Provisions.

Article 28: These Provisions shall be implemented as of May 1 2003.

1. Translation provided by Freshfield Bruckhaus Deringer.