Measures for the Administration of the Check and Approval, and Record Filing of Foreign-invested Projects (Revised)

(Promulgated by the National Development and Reform Commission on December 27 2014.)

Order of the NDRC [2014] No.20

Part One: General Provisions

Article 1: These Measures have been formulated pursuant to the PRC Administrative Permission Law, the Provisions on Guiding the Direction of Foreign Investment, the State Council, Decision on Reforming the Investment Regime and the List of Investment Projects Subject to Government Check and Approval (the Check and Approval List) in order to further intensify reform of the foreign investment administration regime.

Article 2: These Measures shall apply to the various types of foreign-invested projects, such as Sino-foreign equity joint ventures, Sino-foreign cooperative joint ventures, wholly foreign-owned enterprises, foreign-invested partnerships, acquisitions of domestic enterprises by foreign investors, and capital increase and reinvestment projects of foreign-invested enterprises.

Part Two: Project administration methods

Article 3: Administration of foreign-invested projects shall be divided into two methods, check and approval, and record filing.

Article 4: The authority to check and approve foreign-invested projects and the scope of foreign-invested projects subject to check and approval shall comply with the Check and Approval List promulgated by the State Council.

For the purposes of these Measures, the term “project check and approval authority” means an administrative authority that has authority to check and approve projects as specified in the Check and Approval List,

Article 5: Foreign-invested projects falling outside the scope of Article 4 hereof shall be subject to record filing by the department in charge of investment of the local government.

Article 6: The total investment of a capital increase project of a foreign-invested enterprise shall be calculated based on the increase in the investment amount, and the total investment of an acquisition project shall be calculated on the basis of the transaction amount.

Article 7: If a foreign investment has a bearing on national security, a security review shall be carried out in accordance with relevant state provisions.

Part Three: Project check and approval

Article 8: Where an application is to be made for check and approval of a foreign-invested project, a project application report shall be prepared in accordance with relevant state requirements. A project application report shall contain the following:

(1) details on the project and the investor(s);

(2) an analysis of the impact on resource utilisation and the ecological environment; and

(3) an analysis of the impact on the economy and society.

A project application report for the acquisition of a domestic enterprise by a foreign investor shall include information on the acquirer, the acquisition arrangement, financing plan, information on the party being acquired, the operational method, scope of business and equity structure after the acquisition, and the arrangement for the use of the income derived.

Article 9: The National Development and Reform Commission shall, as actually required, prepare and publish versions for general use of project application reports, sample versions of project application reports for major industries and model versions of approval documents for checked projects.

For projects subject to the check and approval of the National Development and Reform Commission or forwarded to the State Council for check and approval after review by the National Development and Reform Commission, the National Development and Reform Commission shall formulate and publish Service Guidelines, setting forth the materials to be submitted for project check and approval and required appendices, the acceptance method, handling procedure, handling time limits, etc. to provide guidance and service to project application entities.

Article 10: The following documents shall accompany a project application report:

(1) documentation evidencing the enterprise registration of the Chinese and foreign parties, their most recently audited enterprise financial statements (including balance sheets, profits statements and cash flow statements) and certificates of fund creditworthiness issued by their banks;

(2) the investment letter of intent, and resolutions of the companies' boards of directors on the capital increase or acquisition project;

(3) the site selection opinion issued by the administrative department in charge of urban and rural planning (only for projects in which state-owned land use rights are provided by allocation);

(4) the opinion upon preliminary land review issued by the administrative department in charge of state land and resources (a preliminary land review may be dispensed with for projects not involving new land where alteration or expansion is to be carried out within the scope of the already approved construction land;

(5) the examination and approval document for environmental impact assessment issued by the administrative department in charge of environmental protection;

(6) the opinion upon energy saving review issued by the energy saving review authority;

(7) if a capital contribution is to be made in the form of state-owned assets, the confirmation document issued by the relevant department in charge; and

(8) other documents the submission of which is required in accordance with relevant laws and regulations.

Article 11: For a project which, based on check and approval authority, is subject to the check and approval of the National Development and Reform Commission, the project application report shall be forwarded to the National Development and Reform Commission after issuance of a preliminary review opinion by the provincial-level development and reform department of the place where the project is to be located. Enterprise groups with independent development plans and enterprises administered by the central government may submit their project application reports directly to the National Development and Reform Commission accompanied by the opinion of the provincial-level development and reform department of the place where the project is to be located.

Article 12: If project application materials are not in order or fail to satisfy relevant requirements, the project check and approval authority shall, within five working days after receipt of the application materials, inform the project application entity once to remedy the situation.

Article 13: For a project that touches upon the functions of a department in charge of the relevant industry, the project check and approval authority shall consult with such department and request that it issue a written review opinion within seven working days. If the department in charge of the relevant industry fails to reply with a written review opinion by the deadline, it shall be deemed to have given its consent.

Article 14: Within four working days from the date of acceptance of the project application report, the project check and approval authority shall, in respect of key issues requiring assessment and verification discussion, appoint a qualified consulting firm to conduct such assessment and verification discussion, and the consulting firm so appointed shall submit an assessment report by the specified time.

For a project that could have a material impact on the public interest, the project check and approval authority shall, in the course of conducting its check, take appropriate means to solicit the opinion of the public. For a particularly material project, the expert assessment system may be employed.

Article 15: The project check and approval authority shall complete its check and approval of the project application report within 20 working days from the date of acceptance of such application. If a check and approval decision cannot be rendered within 20 working days, the officer in charge of the department will approve an extension of 10 working days, and the project application entity shall be informed of the reason for the extension.

The time required for an assessment by an appointed consulting firm or the conduct of an expert assessment shall not count towards the check and approval time limit specified in the preceding paragraph.

Article 16: The conditions for approval of a foreign-invested project after checking are as follows:

(1) it complies with relevant state laws and regulations, the Foreign Investment Industrial Guidance Catalogue and the Catalogue for Foreign Investment in the Dominant Industries of the Central and Western Regions;

(2) it complies with development plans, industry policies and access criteria;

(3) it rationally develops and efficiently utilises resources;

(4) it does not affect national security or ecological safety;

(5) it does not have a material impact on the public interest; and

(6) it complies with relevant state provisions on administration of the capital account and administration of foreign debts.

Article 17: Where a project is granted approval after checking, the project check and approval authority shall issue a written approval document upon checking with copies thereof sent to relevant departments at the same level such as the industry administration department, urban and rural planning department, state land and resources department, environmental protection department and energy saving review department. Where approval is withheld upon checking, the reason therefor shall be given in writing and the project application entity shall be informed that it has the right in accordance with the law to apply for administrative reconsideration or institute an administrative procedure.

Part Four: Project record filing

Article 18: Where an application is to be made for record filing of a foreign-invested project, information such as the basic particulars of the project and the investors, together with other relevant materials such as the documentation evidencing the corporate registration of the Chinese and foreign parties, the investment letter of intent and the resolutions of the companies' boards of directors for the capital increase or acquisition project, shall be submitted by the project application entity.

Article 19: For record filing, a foreign-invested project shall comply with relevant state laws and regulations, development plans, industry policies, access criteria, the Foreign Investment Industrial Guidance Catalogue and the Catalogue for Foreign Investment in the Dominant Industries of the Central and Western Regions.

Article 20: Where record filing of a foreign-invested project is withheld, the local department in charge of investment shall issue a written opinion giving the reason within seven working days.

Part Five: Project changes

Article 21: An application for amendment shall be submitted to the original approval authority in respect of a previously checked and approved or recorded project if:

(1) there is a change in the location of the project;

(2) there is a change in investors or equity;

(3) there is a change in the major construction particulars of the project; or

(4) another circumstance requiring amendment as specified in relevant laws, regulations or industry policies applies.

Article 22: The procedure for amendment of check and approval or record filing shall be handled with reference to foregoing relevant provisions hereof.

Article 23: If, after a change in a previously checked and approved project, such project falls within the scope of administration by record filing, matters shall be handled in accordance with the record filing procedure. If, after a change in a project previously granted record filing, such project falls within the scope of administration by check and approval, matters shall be handled in accordance with the check and approval procedure.

Part Six: Regulation

Article 24: An approval document upon checking or record filing document shall state its term of validity. If construction is not commenced during the term of validity, the project application entity shall submit an application for an extension to the original check and approval or record filing authority 30 working days prior to the expiration of the term of validity. If construction is not commenced during the term of validity and an application for an extension is not made, the original approval document shall automatically become void upon its expiration.

Article 25: For a project checked and approved or recorded in a manner other than in accordance with the specified authority or procedure, relevant departments may not carry out the relevant procedures and financial institutions may not provide credit support.

Article 26: Project check and approval and record filing departments at every level shall duly perform their check and approval and record filing duties, improve monitoring, administration and service, increase administrative efficiency and duly carry out information disclosure work in connection with project check and approval and record filing in accordance with relevant provisions.

Article 27: Development and reform departments at each level, in concert with departments at the same level such as the industry administration department, urban and rural planning department, state land and resources department, environmental protection department, financial regulator and work safety regulator, shall carry out audits and monitoring inspections of project execution by project application entities and the check and approval and record filing of foreign-invested projects, accelerate improvement of information systems, establish horizontal interoperability systems for development planning, industry policy, access criteria, integrity record and other such information, stringently investigate and handle violations of laws and regulations and include them in the negative integrity record and realise sharing of administrative examination and approval and market regulation information.

Article 28: The National Development and Reform Commission shall, in concert with local development and reform departments, establish and improve an electronic information system for the administration of foreign-invested projects so as to make foreign-invested projects searchable and monitorable, and enhance the level of mid-event and post-event regulation.

Article 29: A provincial-level development and reform department shall, by the 10th of each month, summarise and collate the information on the check and approval and record filing of projects in its province for the previous month, including project names, check and approval and record filing document numbers, project locations, Chinese and foreign investors, construction particulars and sources of funds (including total investment and registered capital), and submit the same to the National Development and Reform Commission.

Part Seven: Legal liability

Article 30: If a project check and approval or record filing authority or a member of its working personnel violates a relevant provision hereof, the administrative department or supervision department at a higher level shall order rectification of the matter. If the circumstances are serious, the managing officer directly in charge and other directly responsible persons shall be given administrative sanctions in accordance with the law.

Article 31: If a member of the working personnel of a project check and approval or record filing authority abuses his/her authority in the course of project check and approval or record filing to make private gains and the same constitutes a criminal offence, criminal liability shall be pursued in accordance with the law. If the same is insufficient to constitute a criminal offence, he/she shall be given administrative sanctions in accordance with the law.

Article 32: If a consulting and assessment firm and its personnel or an expert participating in an expert assessment fail(s) to comply with state laws, regulations and these Measures in the course of preparing a project application report, carrying out an assessment upon appointment by the project check and approval authority or participating in an expert assessment, the attendant liability shall be pursued in accordance with the law.

Article 33: If a project application entity uses improper means such as breaking the project into smaller parts or providing fraudulent materials to apply for check and approval or record filing, the project check and approval or record filing authority shall refuse to accept its application or deny approval upon checking or deny record filing. If the project approval document upon checking or record filing document has been secured, the project check and approval or record filing authority shall revoke the approval document upon checking or record filing document for the project in accordance with the law. If construction has commenced, an order shall be given in accordance with the law to halt construction. The pertinent project check and approval or record filing authority and relevant departments shall include the same in the negative integrity record and pursue the legal liability of the relevant responsible persons in accordance with the law.

Part Eight: Supplementary provisions

Article 34: Industry administration departments of the State Council and relevant departments of provincial-level governments that have project check and approval functions may formulate specific implementing measures for check and approval of foreign-invested projects and related Service Guidelines in accordance with relevant state laws, regulations and these Measures.

Article 35: Matters relating to the investment projects of investors from the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan established on the mainland shall be handled with reference to these Measures.

Matters relating to the projects of foreign investors in the China in which the investments are made in renminbi shall be handled in accordance with these Measures.

Article 36: Where laws, administrative regulations and the state have specific provisions on the administration of foreign-invested projects, matters shall be handled in accordance with such relevant provisions.

Article 37: The National Development and Reform Commission is in charge of interpreting these Measures.

Article 38: These Measures shall be effective as of June 17 2014. The Administration of the Verification of Foreign-invested Projects Tentative Procedures (Order of the National Development and Reform Commission No.22) promulgated by the National Development and Reform Commission on October 9 2004 shall be repealed simultaneously.