Laws of the People's Republic of China
[Database Search] [Name Search] [Noteup] [Help]
|Category||FOREIGN ECONOMIC RELATIONS AND TECHNOLOGICAL COOPERATION||Organ of Promulgation||The State Council||Status of Effect||In Force|
|Date of Promulgation||1985-09-30||Effective Date||1985-09-30|
Interim Provisions of the State Council of the People's Republic of China on Preferences for the Construction of Ports and Piers With Chinese and Foreign Joint Investment
Article 1 These Provisions are formulated with a view to expanding
economic cooperation and technological exchange with foreign countries,
speeding up the construction of ports and piers, and meeting the needs of the
socialist modernization programme.
Article 2 All the laws, regulations, provisions, and rules governing
Chinese-foreign equity joint ventures shall apply to joint ventures running
port and pier construction projects (hereinafter called joint ventures)
established within the boundaries of the People's Republic of China by foreign
companies or enterprises, or individual investors (hereinafter called foreign
joint venturers) on the one hand and Chinese companies or enterprises on the
other, and preferential treatment shall, in accordance with these Provisions,
be granted to them out of consideration for their huge investment amount, long
construction cycle, and narrow profit margin.
Article 3 A joint venture may have a comparatively long contract period,
which can be as long as over 30 years. The specific period shall be fixed by
the parties to the joint venture through consultation. A joint venture may
extend the contract period at the expiration of the contract provided that the
extension is agreed upon by the parties concerned and approved by the Ministry
of Foreign Economic Relations and Trade of the People's Republic of China or an
agency authorized by it.
Article 4 A joint venture may recover its investment by accelerated
depreciation of its fixed assets provided that its application for the adoption
of accelerated depreciation procedure is examined by the local tax authorities
and subsequently submitted to and approved by the Ministry of Finance of the
People's Republic of China.
Article 5 Raw materials, loading and unloading equipment, means of
transport, and other production facilities essential for pier construction that
are imported by a joint venture with funds drawn from its gross investment
shall be exempted from customs duties and industrial and commercial
Article 6 A joint venture shall pay income tax at a rate of 15 percent.
Newly founded joint ventures with a contract period of over 15 years shall be
exempted from income tax for the first five years as from the first
profit-making year, and shall pay an income tax at half of the normal rate for
the subsequent five years, provided their applications for exemption and
reduction of tax are approved by the tax authorities of the provinces,
autonomous regions, or municipalities directly under the Central Government
where they are located.
If a joint venture still finds it difficult to pay the full income tax
after the tax exemption or reduction period prescribed above expires, it may
have its tax exemption and reduction period appropriately extended with the
approval of the Ministry of Finance of the People's Republic of China.
Exemption and reduction of the local income tax levied on a joint venture
shall be decided by the people's governments of the provinces, autonomous
regions, or municipalities directly under the Central Government where the
joint venture is located.
Article 7 Profits earned by the foreign joint venturer in a joint venture
shall be exempted from income tax when they are remitted out of China.
Article 8 The rates of charge on cargo handling and other charges on use
of facilities at a pier built by a joint venture may be fixed by the joint
venture, but shall be filed with the authorities in charge of the venture and
the local pricing authorities for the record.
Article 9 When the foreign joint venturer of a joint venture reinvests its
share of profit from the joint venture in building new berths or piers, 40
percent of the income tax paid on the reinvested portion of its profit share
shall be refunded, provided that the new contract period is not shorter than 5
years and the foreign joint venturer's application for refund of tax payment is
approved by the tax authorities.
Article 10 When a joint venture is permitted to run concurrently some
other projects reqiring smaller amounts of investment, a shorter construction
cycle, and allowing a wider profit margin, the related matters shall be dealt
with in accordance with the relevant provisions in force.
Article 11 Matters relating to port and pier construction by joint
ventures with investment of companies, enterprises, or individuals from Hong
Kong and Macao regions shall be dealt with by applying mutatis mutandis these
Article 12 These Provisions shall come into force as of the date of