BIZCHINA / IT Industry
Foreign Investment
Updated: 2006-04-21 14:05
Introduction to Foreign Investment in the Telecom Industry
The sixth clause of the Temporary Regulations for the Administration and
Approval of the Qualification for Engaging in the Telecom Business,
issued by the former Communication Ministry of China on September 11,
1993, stated that foreign organizations, individuals, Sino-foreign joint
ventures, wholly foreign-owned enterprises and collaborative enterprises
do not have the permission to invest, manage or engage in the telecom
business.
The seventh clause of Chapter One of the Temporary Regulations for the
Administration of the Opened Telecom Market, issued on November 10, 1995,
also stated that all kinds of foreign groups, enterprises, persons and
wholly foreign-owned enterprises, joint ventures and collaborative
enterprises are not permitted to join the management of the telecom
business and no form of foreign investment is allowed to become a
shareholder in telecom enterprises. Foreign investment is forbidden in
the Chinese telecom industry.
But with China's entry into the World Trade Organization (WTO), the
Ministry of Information has issued an order to declare that the
above-mentioned regulations be abolished from December 11, 2001 -- the
day China joined the WTO. Thereafter, China will gradually open up its
telecom market to foreign investment according to the telecom-related
commitments in its Schedules of Commitments in Services.
Seeking financing from overseas stock markets is a main method for the
Chinese telecom industry to attract foreign capital and partners.
[Source: Ministry of Information Industry]
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