article 1 Optimize the structure of foreign investment utilization

(I) The Catalogue for the Guidance of Foreign Investment Industries shall be amended in accordance with the requirements for Chinese economic growth and combined with the state industrial restructuring and revitalization plan to expand the open fields and encourage foreign investment in high-end manufacturing, hi-tech industry, modern service industry and new energy and energy-saving and environmental protection industry, and place severe restrictions on “high-polluting, high-energy-consuming and resource-dependent”and low-level and overcapacity expansion projects.(NDRC and MOFCOM with the first being the lead department, the same below)

(II) The policies and measures as prescribed in the the state industrial restructuring and revitalization plan shall be applied to qualified foreign-invested enterprises.(NDRC and the MIIT)

(III) Priority shall be given to the foreign investment projects intensively using land encouraged by the state in land use, which shall be executed at 70% of the corresponding land with the ranking not lower than the land they occupy upon the determination of the minimum land transfer price as prescribed in the State Standard for the Minimum Price of Transfer of Land for Industry Use. (Ministry of Land and Resources)

(IV) Foreign investment shall be encouraged in the hi-tech enterprises and the recognition on hi-tech enterprises shall be improved. (MOST, MOF and SAT together with such departments as NDRC, MOFCOM and MIIT)

(V) Domestic and foreign enterprises shall be encouraged to enhance R&D cooperation and qualified foreign investment enterprises shall be supported to cooperate with domestic enterprises and research institutes to apply for the scientific development projects and innovation capacity building projects of the state.(NDRC, MOST and MOF)

And application shall be filed for the recognition of the establishment of the national-level technology center.(NDRC, MOST, MOF, GAC,and SAT)

(VI) Transnationals shall be encouraged to set up such functional agencies as regional headquarters, R&D centers,procurement centers, finance management centers, settlement centers and cost and profits accounting centers within China (MOFCOM, SAFE, CBRC, NDRC, MOF and SAIC)

Qualified scientific development products imported and indeed needed by foreign-funed R&D centers shall be exempt from import tariff and the added value tax and consumption tax in the import prior to December 31, 2010. (MOF, MOFCOM, GAC and SAT)

(VII) Supporting policy shall be implemented and improved to encourage foreign investment in the services outsourcing industry and introduction of advanced technology and management experience so as to raise the international competitiveness of the services outsourcing industry of China. (MOFCOM)

article 2 Guide foreign investment in the central and western area and increase of investment

(VIII) In compliance with the amended Catalogue for the Guidance of Foreign Investment Industries and the supplementary amendment to the Catalogue for Foreign Investment in Competitive Industries in the Central and Western Area, labor-intensive items shall be increased to encourage foreign-invested enterprises to develop qualified labor-intensive industries in the central and western area. (NDRC and MOFCOM)

(IX) Preferential policies for business income tax shall be continuously subject to qualified domestic and foreign-funded enterprises in the central and western area to maintain the good trend of absorbing foreign investment. (MOF, NDRC, MOFCOM and SAT)

(X) The strength in the open policies and technology and capital supporting for the shif of foreign-funded enterprises in the east to the central and western area shall be intensified and administrative services shall be simultaneously improved to provide convenience while handling the formalities of industry and commerce, taxation, foreign exchange and social security. (NDRC, MOFCOM, MOF, MOHRSS, SAIC, AQSIQ, SAT and SAFE)

Foreign-funded banks shall be encouraged and guided to establish agencies and operate business in the central and western area. (CBRC)

(XI) The east and the central and western area shall be encouraged to be market-oriented to jointly set up development zones by means of mandatory administration and investment cooperation in the principle of complementary advantages, industrial linkage and benefit sharing. (NDRC and MOFCOM)

article 3 Promote the diversification of foreign investment utilization

(XII) Foreign investment shall be encouraged in such forms as participation and M&A to participate in the reform and restructuring and merger and reorganization of domestic enterprises. A-share listed companies shall be supported to introduce strategic investors from home and abroad. And regulations shall be conducted for foreign investors to participate in securities investment and corporate M&A within China. (MOFCOM, CSRC, NDRC and MIIT)

Antitrust scrutiny shall be executed by force of law. (MOFCOM, NDRC and SAIC taking responsibilitis in accordance with the duties)

Foreign-capital M&A security review system shall be accelerated to be set up. (NDRC and MOFCOM)

(XIII) Overseas capital market shall be utilized to continuously bolster qualified enterprises to be listed overseas in accordance with the state development strategy and their own situations to make full use of two markets and two kinds of resources to constantly improve competitiveness. (CSRC, NDRC and MOFCOM)

(XIV) The pilot program on utilizing foreign investment to set up small and medium-sized enterprises bonding companies shall be sped up. (NDRC and MOFCOM)

Foreign investors shall be encouraged to establish venture investment enterprises, initiatives shall be taken to utilize private equity funds and the withdrawal mechanism shall be improved. (NDRC, MOFCOM, SAIC, CSRC and SAFE)

(XV) Qualified foreign investment enterprises shall be supported to conduct initial public offering and issue corporate bonds and medium-term notes to widen the financing channels to guide financial institutions to continuously intensify the credit support for foreign investment enterprises. Overseas subject engaging in issuing RMB bonds within China shall be steadily being expanded. (PBOC, CSRC, CBRC, NDRC and MOFCOM)

article 4 Deepen the reform of the foreign investment management system

(XVI) Encourage and permission projects with total investment (inclusive of increase of capital) as prescribed in the Catalogue for the Guidance of Foreign Investment Industries shall be verified and approved by relevant departments of local governments unless otherwide provided for by the Catalogue for the Investment Items Verified and Approved by Governments. (NDRC)

Relevant departments of the State Council may delegate the approval items in the charge of themselves to local governments under the premise of strengthening supervision and administration unless otherwide specified by laws and regulations, with the establishment of foreign investment enterprises in the service industry (exclusive of finance and telecommunication services) verified and approved by local governments according to relevant provisions.(MOFCOM and other departments)

(XVII) The contents of verification and approval shall be adjusted and approval procedures shall be simplified to narrow the scope of verification and approval to the largest extent to enhance the transpancy of verification and approval. Verification and approval items involved in foreign investment shall be fully cleared to shorten the approval time. Approval procedures shall be improved to gradually carry out the formating approval of contract and articles of association for foreign investment enterprises nationwide and strongly implement online administrative licensing to regulate administrative acts on the basis of trial and summing up experience. (MOFCOM and NDRC)

article 5 Create a good environment of investment

(XVIII) Development zones shall be regulated and promoted to exert their role of carrier and platform in institutional innovation, scienfic and technical leading, industrial agglomeration, land consolidation and other aspects. (NDRC, Ministry of Land and Resources, MOHURD, MOST and MOFCOM)

Qualified provincial-level development zones shall be supported to upgrade and qualified national-level development zones to expand and adjust the locations. (with MOFCOM and MOST taking the lead according to duties and Ministry of Land and Resources, MOHURD and NDRC participating)

Qualified provincial-level development zones shall be supported to expand and adjust locations. (NDRC, Ministry of Land and Resources, MOHURD, MOST and MOFCOM)

Supporting policies and measures shall be prepared to speed up the construction of border economic cooperation zones. (MOFCOM, MOF, Ministry of Land and Resources and MOHURD)

(XIX) Foreign exchange management of foreign investment enterprises shall be furhter improved and the procedures of settlement of foreign exchange capital for foreign investment enterprises shall be simplified. (SAFE)

Foreign investment enterprises operating business by law but failing to make contribution on time temporarily for lack of capital shall be allowed to prolong the deadline of contribution. (SAIC and MOFCOM)

（XX）Investment promotion shall be stepped up and strength of recommendation and introduction of absorbing foreign investment from key countries and regions and industries shall be enhanced to extensively publicize Chinese policies for foreign investment utilization. Initiatives shall be taken to participate in multilateral investment cooperation to combine “absorb foreign investment” and “go abroad” to boost the cross-border investment policy environment to be constantly improved. (MOFCOM and NDRC)