Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button
Instant Button


REGULATIONS FOR THE ADMINISTRATION OF THE
TIANJIN ECONOMIC AND TECHNOLOGICAL
DEVELOPMENT ZONE

(Issued on July 20, 1985 by the twenty-first
session of the Standing Committee of the
Tenth People's Congress of Tianjin)

 



SUBJECT: ECONOMIC & TECHNOLOGICAL DEVELOPMENT ZONES

ISSUING-DEPT: TIANJIN MUNICIPALITY

ISSUE-DATE: 07/20/1985

IMPLEMENT-DATE: 07/23/1985

LENGTH: 2543 words

TEXT:

CHAPTER I GENERAL PRINCIPLES

[Article 1] These Regulations, promulgated according to the Constitution, laws and regulations of the People's Republic of China, have been formulated in order to develop economic co-operation and technical exchanges with foreign countries and regions, to open up new industries and technology, and to promote the socialist modernisation programme in the municipality of Tianjin.

[Article 2] The Tianjin Economic and Technological Development Zone (hereinafter referred to as the Development Zone) has been established with the approval of the State Council of the People's Republic of China.

The Development Zone lies adjacent to the port of Tianjin and has a total area of 33 square kilometres.  In addition a residential area will be built specifically to service the Development Zone.

[Article 3] The purpose of the Development Zone is to provide favourable investment conditions for companies, enterprises, other economic organisations, and individuals from Hong Kong, Macao and abroad, etc. (these companies, enterprises, economic organisations and individuals are hereinafter referred to as investors), and to protect investors' capital and property, legitimate profits, and other lawful rights and interests according to laws of the People's Republic of China.

[Article 4] All organisations and individuals in the Development Zone must abide by the laws and regulations of the People's Republic of China and by these Regulations.

[Article 5] The land of the Development Zone is owned by the People's Republic of China.  With approval, investors in the Development Zone are entitled to use this land.

[Article 6] The establishment of technologically advanced industrial projects shall be given priority in the Development Zone.  All such projects which are conducive to the growth of the Chinese economy and technological progress may be established by investors participating in joint ventures with, or in co-operation with, Chinese investors, or by investors acting on their own.

[Article 7] Chinese investors of other cities and provinces and foreign investors shall be encouraged to invest in the development and management of such infrastructure services as water, gas, and power supplies, heating and drainage systems, and roads in the Development Zone.

[Article 8] Departments of the Chinese Government and departments of the Municipality of Tianjin and of other cities and provinces, enterprises, scientific institutes and institutions of higher learning shall be encouraged to develop industrial projects, scientific research projects and projects that promote economic growth in the Development Zone and aid the well-being of the people living and working there.

[Article 9] The following projects shall not be allowed in the Development Zone:

(1) Projects using outdated technology and equipment;

(2) Projects that pollute the environment in a way that cannot be practically controlled;

(3) Projects that make products the manufacture of which is forbidden or restricted by the government of the People's Republic of China.

CHAPTER II ADMINISTRATION OF THE DEVELOPMENT ZONE

[Article 10] The Tianjin Economic and Technological Development Zone Administrative Commission (hereinafter referred to as the Development Zone Administrative Commission) under the government of the Municipality of Tianjin shall exercise unified administration over the Development Zone.

[Article 11] The Development Zone Administrative Commission shall perform the following functions:

(1) Formulate and implement administrative regulations for the Development Zone;

(2) Formulate development plans for the Development Zone and, upon their approval by the authorities, implement these plans;

(3) Examine and approve, when appropriate, investment projects in the Development Zone;

(4) Integrate plans and the various basic services and public services, in relation to administration of the Development Zone and set a standard charge for the relevant service;

(5) Exercise centralised control over imports and exports for the Development Zone according to the regulations of the People's Republic of China;

(6) Inspect and supervise the work of the various branches established in the Development Zone by relevant departments of the Municipal Government and arbitrate work disputes between these branches;

(7) Co-ordinate and supervise the work of the various branches established in the Development Zone by the relevant departments of the State Council;

(8) Exercise administration over labour management of the enterprises in the Development Zone, and protect the lawful rights and interests of the staff and workers in these enterprises;

(9) Establish public welfare institutions in the Development Zone;

(10) Inspect and supervise the enterprises and institutions in the Development Zone in accordance with the law;

(11) Perform other functions authorised by the People's Government of Tianjin.

CHAPTER III REGISTRATION AND OPERATION

[Article 12] Those who wish to set up enterprises or institutions in the Development Zone shall apply to the Development Zone Administrative Commission for a land use certificate.  After their application has been ratified, they will obtain a land use certificate and only then shall they go through the procedures for industrial and commercial registration.

[Article 13] Enterprises and institutions shall open accounts and conduct relevant foreign exchange transactions with the Bank of China in the Development Zone or with other banks established with the approval of organs of the State Foreign Exchange Administration.

All insurance of enterprises and institutions in the Development Zone shall be handled by Chinese insurance companies in the Development Zone.

[Article 14] Each enterprise shall establish an account book in the Development Zone and shall submit a quarterly and an annual statement of final accounts in accordance with relevant regulations.  These statements of final accounts shall be submitted to the Development Zone Administrative Commission and to the authorities of the finance, taxation and foreign exchange administration departments of the Development Zone.

The annual statement of final accounts submitted by the enterprise shall not be effective unless it has been verified and certified by an accountant registered in the People's Republic of China.

[Article 15] If an enterprise wishes to terminate operations, it shall report the reasons for termination to the Development Zone Administrative Commission and go through termination procedures.  If the enterprise does not wish to go into business again, it shall also present a report of property settlement verified by an accountant registered in the People's Republic of China and it shall have its business licence cancelled.  After any claims and debts have been completely settled, the remaining assets may have possession transferred and the investors' funds remitted abroad.

CHAPTER IV LABOUR MANAGEMENT

[Article 16] The labour plan of each enterprise or institution in the Development Zone shall be filed with the labour management department of the Development Zone and be brought into line with the labour plan of the Municipality of Tianjin.

[Article 17] Enterprises and institutions in the Development Zone may hire Chinese staff and workers who have been recommended by the Labour Service Company of the Development Zone or they may, with the approval of the Administrative Commission, recruit their own Chinese staff and workers.

Sino-foreign joint ventures, Sino-foreign co-operative enterprises and wholly foreign owned enterprises in the Development Zone may employ staff and workers from Hong Kong, Macao, and abroad.

[Article 18] In employing staff and workers, enterprises and investors in the Development Zone shall use written labour contracts.  They shall manage their staff and workers according to labour contracts and any relevant labour management regulations.

[Article 19] The levels and forms of wages and the system of incentives and subsidies may be determined by enterprises and investors themselves in accordance with the regulations of the Development Zone Administrative Commission and the conditions of production and operations.

[Article 20] Enterprises in the Development Zone shall, in accordance with the relevant provisions of the People's Republic of China and of the Municipality of Tianjin, adopt measures of labour protection to ensure the health and safety of all staff and workers.

[Article 21] Sino-foreign joint ventures, Sino-foreign co-operative enterprises and wholly foreign owned enterprises shall provide guaranteed social insurance for all Chinese staff and workers and shall accept supervision by the relevant competent body.

[Article 22] All staff and workers of the enterprises in the Development Zone have the right to establish trade union organisations, to protect their legal rights and interests and to organise trade union activities.

CHAPTER V PREFERENTIAL TREATMENT

[Article 23] The Development Zone Administrative Commission shall provide the enterprises and institutions in the Development Zone with a site and collect a site use fee (including land use fees and land development fees).

In determining the amount and the method of payment in relation to the site use fee, consideration will be given to the type of business and the land usage.  Specific regulations shall be formulated by the Development Zone Administrative Commission.

[Article 24] Sino-foreign joint ventures, Sino-foreign co-operative ventures and wholly foreign owned production enterprises operating in the Development Zone shall be given a 15 per cent reduction on enterprise income tax on income received from manufacturing operations and other income.  Those manufacturing enterprises that will operate for ten years or longer may receive an exemption from income tax for the first two years that they earn profits and a 50 per cent reduction on income tax for the following three years.  In order to receive this exemption, the enterprise must apply to the Municipal Tax Bureau of Tianjin for approval.

[Article 25] Investors shall not have to pay remittance income tax on after-tax profits that are sent abroad.

[Article 26] Investors that have no resident offices in China but have income from dividends, interests, rent, and royalties and other kinds of income related to the Development Zone shall be given a 10 per cent reduction on income tax.  This rate will not cover income that is already exempt from income tax in accordance with the relevant laws of the People's Republic of China.  More favourable terms of reduction or of exemption from income tax may be sought by application to the Municipal Tax Bureau of Tianjin.  Such terms will be given only to those enterprises that have given special consideration in providing funds and equipment or that have transferred advanced technology to the People's Republic of China.

[Article 27] Production equipment, building material, reasonable amounts of office equipment and reasonable numbers and types of vehicles imported by enterprises in the Development Zone for their own use shall be exempt from Customs duties and industrial and commercial consolidated tax (or product tax and value added tax).

Raw materials, spare parts and components imported by enterprises in the Development Zone for manufacturing products for export shall be exempt from customs duties and industrial and commercial consolidated tax (or product tax and value added tax).  If for special reasons these products cannot be exported, they shall not be sold in the People's Republic of China until an application has been approved by the department in charge and until Customs have verified that the import duties owing have been paid and industrial and commercial consolidated tax (or product tax and value added tax) have been levied on them.

[Article 28] Products manufactured for export, except those products the export of which is restricted by the State, shall be exempt from Customs duties and from industrial and commercial consolidated tax on the industrial segment.

If an enterprise has difficulty in paying taxes in the early phase of its operation, the products for the domestic market shall, upon application of the enterprise and approval by the Municipal Tax Bureau of Tianjin, be given a reduction of or an exemption from industrial and commercial consolidated tax for a specific period of time.

[Article 29] The parties to a joint venture that reinvest, in China, their shares of profits obtained from that venture for a period of not less than five years shall, upon approval by the Municipal Tax Bureau of Tianjin, be refunded 40 per cent of the income tax already paid on the reinvested portion.  If they withdraw the investment within five years they shall repay the refunded tax.

[Article 30] Products produced by enterprises within the Development Zone, which are manufactured with advanced technology, techniques, and equipment, which are in short supply in China and therefore need to be imported in great quantities, and which are of much higher quality than those domestically produced may, upon approval by relevant departments, replace imported products.  The ratio of their sale on the domestic market may be increased.

[Article 31] The period of depreciation of the fixed assets of an enterprise may be shortened upon the approval of the Ministry of Finance of the People's Republic of China.  However, the depreciation expense shall be calculated on an annual basis, starting from the year the assets are put into production.

[Article 32] Losses incurred by an enterprise in a fiscal year may be carried over to the next year and offset against that year's income within a period not exceeding five years.

[Article 33] Reasonable amounts of imported articles for home use and a reasonable number of imported vehicles for the personal use of staff and workers in the Development Zone from Hong Kong, Macao and abroad may be exempted from Customs duties upon presentation of a certificate issued by the Development Zone Administrative Commission and examination and approval by Customs authorities.

[Article 34] Sino-foreign joint ventures, Sino-foreign co-operative enterprises and wholly foreign owned enterprises, which are established with approval before 1990 in the Development Zone shall be exempt from the local income tax of Tianjin Municipality.

[Article 35] Entry and exit procedures shall be simplified and made more convenient for people from Hong Kong, Macao, and abroad to travel to and from the Development Zone.

[Article 36] Investors and other enterprises in the Development Zone shall at the same time enjoy all other preferential treatment afforded by the laws and regulations of the People's Republic of China.

CHAPTER VI SUPPLEMENTARY PROVISIONS

[Article 37] These Regulations shall come into force on the date of their promulgation.