USING ELECTRONIC EVIDENCE IN CHINA
Mar. to Jun. 2015 China Bulletin

Electronic signatures that meet certain conditions have been valid in China since the PRC Electronic Signature Law came into effect in 2005, and other electronic data is recognized as admissible in court.  However, Chinese courts have proven reluctant to admit electronic data in practice because it can be easily altered and its authenticity is typically open to challenge.  In an interpretation issued January 30, 2015, the Supreme People’s Court (SPC) for the first time Continue reading

CYBERSECURITY REQUIREMENTS SUSPENDED
Mar. to Jun. 2015 China Bulletin

The CBRC and Ministry of Industry and Information Technology (MIIT) have suspended the Guidelines on Secure and Controllable Information Technology that the Banking Industry Should Use (2014-15) (Guidelines) until further notice in order to consider feedback from lenders.   Foreign-owned financial institutions, foreign technology trade groups and others had protested that the Guidelines would have excluded foreign suppliers from the Chinese market; Continue reading

LOCAL INCENTIVES REVOKED
Mar. to Jun. 2015 China Bulletin

The State Council and Ministry of Finance took a decisive stroke by issuing the Notice Regarding Cleaning Up and Standardizing Preferential Policies in November 2014 (Notice 62), possibly ending a decades long tug-of-war over preferential incentives local governments use to attract investment.  Existing incentives were to be reported to the State Council and cleaned-up on a consolidated basis by March, 2015, provoking an outcry from companies such as Continue reading

PROGRESS IN “BITS” WITH US AND EU
Mar. to Jun. 2015 China Bulletin

China and the United States recently made a commitment exchange revised “negative lists” in September and speed up talks on a bilateral investment treaty (BIT).  Also, China’s premier, Li Keqiang, recently urged early conclusion of negotiations on a BIT with the European Union.  Most member EU states have BITs with China, but many are out of date.  BITs facilitate cross-border investment Continue reading

JUNE 30th DEADLINE FOR ANNUAL INSPECTION
Mar. to Jun. 2015 China Bulletin

As a reminder, the annual filing for subsidiaries and representative offices in China must be submitted not later than June 30th.  Representative offices are still subject to inspection, but the inspection of companies in China, including foreign-invested enterprise subsidiaries (“FIEs”), was abolished in 2014.  FIEs no longer need to submit paper documents to the authorities, but still must complete an annual filing through designated government online systems.  Penalties for failing to file include a fine Continue reading

FOREIGN INVESTMENT LAW UPDATE
Mar. to Jun. 2015 China Bulletin

The PRC Foreign Investment Law (Draft for Comments)released in January,  promises to substantially change the foreign investment regime in China (see Feb 2015 China Bulletin).  The revised law, when issued, will level the playing field by effectively eliminating “foreign invested enterprises” (FIEs) as a separate category in many industries in China. It will allow an FIE to be registered almost as quickly Continue reading

NEW FREE TRADE ZONES
Mar. to Jun. 2015 China Bulletin

A number of foreign investment pilot reforms were instituted in the Shanghai Free Trade Zone (SFTZ) since it was established in 2013.  At the end of 2014, the State Council approved the establishment of three new free trade zones (FTZs) in Tianjin, Fujian and Guangdong, and expanded the area of the SFTZ to include the Lujiazui Financial District, Jinqiaqo Development Zone and Zhangjiang Hi-Tech Park. Continue reading

FOREIGN INVESTMENT CATALOG – 6th REVISION
Mar. to Jun. 2015 China Bulletin

The 6th revision of the Foreign Investment Industrial Guidance Catalog (Catalog) became effective April 10, 2015, replacing the 2011 5th revision.  All versions of the Catalog have served to regulate the inflow of foreign investment into China.  The 2015 Catalog does not adopt a negative list, as implemented in the free trade zones, but it substantially reduces the number of industries in the restricted category, Continue reading

WESTERN ENCOURAGED CATALOG UPDATE
Mar. to Jun. 2015 China Bulletin

The State Administration of Taxation (SAT) issued an announcement on March 10, 2015, (Notice 14) on enterprise income tax issues following from the Encouraged Foreign Investment Project Catalog for Central and Western China (Central & Western Catalog), as supplemented by the Catalog of Encouraged Industries in the Western Region, released by the National Development and Reform Commission and effective from October 1, 2014 Continue reading