Eleven new influential regulations for Chinese businesses

2018-7-3 9:06:16

1 New cuts on foreign investment


China announced on Thursday night a new list to further cut restrictions on foreign investment from 63 to 48, especially in the service sector, infrastructure, railway passenger transportation, international shipping, grain purchases and wholesales businesses. It will take effect on July 28.

In the financial sector, the foreign-capital cap in the banking sector was lifted, and the foreign-capital limit of securities companies, fund management companies, futures companies, and life insurance companies were relaxed to 51 percent.

All foreign capital restrictions in the financial sector will be removed by 2021.

In infrastructure, the railway trunk line network and grid foreign investment restrictions will be removed. The restrictions on foreign investment in railway passenger transportation companies, international maritime transport and international shipping agencies will be eliminated.

Restrictions on foreign investment in gas stations, grain purchases and wholesales will also be eliminated.

2 Import tariffs cut for daily consumer goods


China will cut most-favored-nation tariffs for 1,449 taxable items of daily consumer goods starting July 1, from an average tariff rate of 15.7 percent to 6.9 percent.

On average, the tariffs were cut by 55.9 percent, the Customs Tariff Commission of the State Council reported.

The average tariff rate for clothing, shoes and hats, kitchenware and sports and fitness supplies will be reduced from 15.9 to 7.1 percent, and home appliances such as washing machines and refrigerators will see reductions from 20.5 to 8 percent.

The average tariff rate for cultured and fished aquatic products and processed food such as mineral water will be cut from 15.2 to 6.9 percent.

The average tariff rate for detergents, cosmetics such as skin care and hair care products and some medicine and health products will be cut from 8.4 to 2.9 percent.

3 Import tariff reductions for cars and auto parts

The Chinese Ministry of Finance announced it would cut import tariffs on vehicles and auto parts from July 1.

For cars, the 25-percent tariff levied on 135 items and 20-percent duty on four items will both be cut to 15 percent. Import tariffs on 79 auto parts will all be reduced to 6 percent from the current level of 8 to 25 percent.

4 Cut tariffs on some goods from Asia-Pacific nations

China will cut import tariffs on goods from certain Asia-Pacific countries, starting from July 1, according to the State Council.

China will reduce the tariffs on soybean imported from India, South Korea, Bangladesh, Laos, and Sri Lanka from the current 3 percent to zero. Imported products such as chemicals, agricultural products, medical supplies, clothing, steel and aluminum products from these countries will also enjoy certain tariff reductions.

All imported products from the above five countries will adapt a tariff rate of the Second Amendment of The Asia-Pacific Trade Agreement, said the State Council.

5 Adjustment fund system to ensure pensions

The central government is adopting an adjustment fund system for basic pensions covering employees of enterprises, addressing different situations among provincial regions and ensuring punctual and full pension payments to retirees.

The State Council, China's Cabinet, said on June 13 the system, which will be put in place on July 1, will be based on the current pension system and will not add to financial burdens on businesses or their employees.

The adjustment fund system will draw a certain portion from provincial pension fund pools and redistribute it later, based on 90 percent of the average salary in each region and the number of people that should be insured.

6 Domestic roaming fees eliminated

Major telecom carriers China Mobile, China Unicom and China Telecom announced on June 22 they will eliminate charges for domestic roaming data use starting July 1.

The Ministry of Industry and Information Technology released guidelines in May to prompt mobile service operators to eliminate domestic roaming charges and to reduce data prices by at least 30 percent within the year.

7 Prices of high-speed rail tickets changed

China Railway Corporation announced changes in high-speed rail ticket price starting from July 5. Trains of six routes, namely Hefei to Wuhan, Wuhan to Yichang, Guiyang to Guangzhou, Liuzhou to Nanning, Shanghai to Nanjing, and Nanjing to Hangzhou with speed at 200-250 km/h, are included in the new fare list, with the biggest discount reaching 35 percent.

China Railway will implement a new train timetable starting from July 1, with Fuxing bullet train with 16 carriages starting to run for the first time.

8 More pre-tax deduction items for enterprises

Receipt vouchers, internal documents and tax slips can also be used as pre-tax deduction vouchers for enterprises starting July 1, which will reduce the burden of taxpayers, according to the Management Measure for Enterprise Income Tax Pre-tax Deduction Vouchers issued by the State Administration of Taxation.

9 10,000 yuan daily withdrawal limit for T+0 money fund redemption on internet

Starting from July 1, 2018, quick redemption for money fund on the internet will have a 10,000 yuan ($1,529.75) withdrawal limit for those bought and sold on the same day (T+0), according to the China Securities Regulatory Commission and the People’s Bank of China.

10 Research findings turn to cash for scientists and engineers

Scientists and engineers can receive 50 percent of their cash bonus through research findings transformation in their monthly salaries starting July 1, according to the Ministry of Finance, the State Administration of Taxation, and the Ministry of Science and Technology. This regulation applies to scientific and technological staff working for non-profit R&D and higher education institutions.

11 No substandard vehicle carriers on road

Starting July 1 all substandard vehicle carriers will be banned from the road, according to the Vehicle Carrier Management Work Plan issued by five government departments, including the Ministry of Transport, Ministry of Public Security and Ministry of Industry and Information Technology. All substandard vehicle carriers need to be upgraded or eliminated by June 30, the plan read.

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