China Market Intelligence

September 5th, 2007

The Standing Committee of the twenty-ninth National People's Congress (NPC) met in Beijing from August 24 to 30 and passed several laws, including the long-awaited Antimonopoly Law, and read the Draft Labor Dispute Resolution Law for the first time.

The Antimonopoly Law, which will take effect August 1, 2008, requires closer scrutiny of mergers and acquisitions of Chinese firms by foreign investors. The Employment Promotion Law, which will take effect January 1, 2008, forbids...
September 5th, 2007

In the lead up to the seventeenth Chinese Communist Party (CCP) Congress, which convenes on October 15 in Beijing, the State Council last week replaced Jin Renqing with Xie Xuren as minister of Finance. An official statement released on August 30 announced that Jin resigned for "personal reasons." Foreign media have speculated that Jin was forced to resign for corruption and keeping a mistress. Although ministerial reshuffling is common before CCP congresses, which occur every five years,...

September 5th, 2007

The PRC General Administration of Quality Supervision, Inspection, and Quarantine (AQSIQ), on August 31 announced the creation of China's first recall system for unsafe food and toys. The system mandates that in the event of proof of defective products, manufacturers must halt production and sales, notify vendors and customers, and report problems to AQSIQ and other quality-control authorities, according to the rules. Fines for violating the new rules range from RMB 1,000 ($132) to RMB 50,...

September 5th, 2007

The US-China Business Council (USCBC) recently met with officials at the State Administration for Industry and Commerce (SAIC) in Beijing to discuss corporate structures, trademark protection, and other issues of concern to member companies.

Potential "operating departments" structure

SAIC is drafting regulations that would allow foreign-invested enterprises (FIEs) and their branches, both legal-person entities under PRC law, to set up sales offices, or "operating...

September 5th, 2007

To clarify several implementation issues associated with regulations released in late July, the PRC General Administration of Customs on August 22 released Announcement 46. The July regulations place significant new restrictions on China's processing trade, including the addition of 1,853 product categories to the Catalogue on Restricted Processing Trade Commodities and the requirement for processing trade enterprises to provide guarantees in the form of bank deposits for their processing...

August 29th, 2007

Over the past year, US-China Business Council (USCBC) member companies have stated that a key priority for their companies' China operations is to better understand how to manage and upgrade their China-based government affairs function. In an effort to help member companies share best practices and address questions about developing their government affairs component, USCBC on August 23 hosted a Government Affairs Workshop in Beijing. More than 70 member company executives attended.

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August 29th, 2007

The PRC State Council recently appointed new high-ranking cabinet officials and removed others.

Jiang Weixin was appointed vice minister of Construction and removed from his post as a vice chair of the National Development and Reform Commission; Gao Hongbin was appointed vice minister of Agriculture; Li Bin was appointed vice commissioner and Chinese Communist Party (CCP) secretary of the National Population and Family Planning Commission of China. Zhang Weiqing was...
August 29th, 2007

The PRC National Development and Reform Commission (NDRC) last week publicly released a broad blueprint for pushing forward China's economic reforms in 2007, emphasizing areas such as financial and tax systems, foreign investment, trade, healthcare, social security, state-owned enterprises (SOEs), the rural economy, energy, and the environment. Like similar state plans, the Opinion on the 2007 Work Plan on Deepening Economic Reforms lacks concrete details, though the work plan may result in...

August 29th, 2007

China's urban fixed-asset investment climbed to RMB 5.7 trillion ($750.1 billion) in the first seven months of 2007, up 26.6 percent year on year. Investment from domestic enterprises constituted 88.5 percent of the total, while foreign investment made up only 6 percent.

Investment appeared to primarily target natural resources industries, including coal mining and washing (up 17.2 percent), petroleum and natural gas extraction (up 10.4 percent), ferrous and nonferrous metal smelting...

August 29th, 2007

The Standing Committee of the Shanghai Municipal People's Congress on August 17 passed the Regulations on Collective Contracts, which appear to require all enterprises located within the municipality to use a collective bargaining process. The rules are based on China's new Labor Contract Law, for which national implementing regulations have yet to be issued. The PRC Ministry of Labor and Social Security is reportedly drafting such national implementing rules, and it is likely that Shanghai...

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