Central Committee of the Communist Party of China and State Council, Guiding Opinions on Intensifying Reform of State-owned Enterprises
中共中央、国务院关于深化国有企业改革的指导意见
September 29, 2015 | BY
Susan MokSOEs categorized to allow diversification of ownership.
Issued: August 24 2015
Applicability: Where the central government has separate provisions on the reform of financial and cultural state-owned enterprises, such provisions shall prevail.
Main contents: The Opinions promote the reform of commercial state-owned enterprises. All commercial state-owned enterprises whose main business is in fully competitive industries and sectors are in principle required to implement reform that converts them into corporate legal persons and companies limited by shares, and actively bring in other state-owned capital or various types of non-state-owned capital to realize equity diversification. State-owned capital may have absolute control, relative control or may have an equity interest, and efforts shall be made to promote overall listing. With respect to such state-owned enterprises, the focus of assessment shall be business performance indicators, the maintenance and increase of the value of state-owned assets and market competitiveness.
Commercial state-owned enterprises whose main business is in important industries and key sectors crucial to national security or the life blood of the national economy and that mainly undertake material specific tasks, are required to maintain a controlling position for state-owned capital, but also support the taking of equity interests by non-state-owned investors. With respect to natural monopoly industries, reform that mainly involves the separation of government and enterprise, the separation of government public administration functions and state-owned capital owner functions, concessions and government oversight will be implemented. With respect to enterprises that require complete state ownership, the active bringing in of other state-owned capital to realize equity diversification is required. With respect to special business and competitive business, effective separation of the business segments is to be carried out, and they are to be independently operated and independent accounting is to be practiced therefor (Article 5).
Public service state-owned enterprises may be in wholly state-owned form, and for those that possess the required conditions, diversification of investment entities may be promoted. Additionally, participation by non-state-owned enterprises in their operations may be encouraged through means such as the purchase of services, concessions and appointed agency (Article 6).
The Opinions permit the conversion of a portion of state-owned capital into preference shares, and explore in a limited number of specific sectors of the establishment of a state special management share system (Article 7).
The Opinions ensure the operating autonomy of management, and laws do not authorize any governmental department or agency to interfere therein (Article 8).
The Opinions encourage non-state-owned capital investment entities to participate in the change in form and restructuring of state-owned enterprises, or the capital and share increases of state-controlled listed companies and their enterprise operations and management through various ways such as the making of capital contributions to acquire an equity interest, acquisition of equity, subscription for convertible bonds and equity swaps. The system where all shares of the same class have the same rights is implemented. Projects that comply with industrial policy are promoted to non-state-owned capital in sectors such as petroleum, natural gas, electric power, railways, telecommunications, resource development and public utilities. The foreign investor security review work mechanism will be improved based on the Foreign Investment Industrial Guidance Catalogue and relevant security review provisions (Article 17).
The Opinions encourage state-owned capital to take equity interests in non-state-owned enterprises. The sectors of focus are public services, high and new technology, ecological environmental protection and strategic industries (Article 18).
clp reference:2140/15.08.24This premium content is reserved for
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