INTERIM MEASURES FOR THE ADMINISTRATION OF THE FOREIGN-INVESTEDDEVELOPMENT AND MANAGEMENT OF TRACTS OF LAND

INTERIM MEASURES FOR THE ADMINISTRATION OF THE FOREIGN-INVESTEDDEVELOPMENT AND MANAGEMENT OF TRACTS OF LAND This English document is coming from the "LAWS AND REGULATIONS OF THE PEOPLE'S REPUBLIC OF CHINA GOVERNING FOREIGN-RELATED MATTERS" (1991.7) which is compiled by the Brueau of Legislative Affairs of the State Council of the People's Republic of China, and is published by the China Legal System Publishing House.

In case of discrepancy, the original version in Chinese shall prevail.

Whole Document INTERIM MEASURES FOR THE ADMINISTRATION OF THE FOREIGN-INVESTED DEVELOPMENT AND MANAGEMENT OF TRACTS OF LAND (Promulgated by Decree No. 56 of the State Council of the People's Republic of China on May 19, 1990 and effective as of the date of promulgation) Article 1 These Measures are formulated for the purpose of attracting foreign investment for the development and management of tracts of land (hereinafter referred to as "tract development") so as to intensify the construction of public works, improve the environment for investment, introduce foreign-invested technically advanced enterprises and export- oriented enterprises and develop the export-oriented economy.

Article 2 The term "tract development" as used in these Measures means that after obtaining the right to the use of state-owned land, the investors shall carry out, as planned, comprehensive development and construction on the land, including levelling the ground and constructing such public works as water supply and drainage systems, power and heat supply systems, roads and communications networks, and communications facilities, so that conditions shall be created for the land to be used for industrial or other construction purposes. The investor shall then transfer the right to the use of the land for operating public utilities, or proceed to construct such above-ground buildings as industrial houses and the supporting facilities for production and everyday life services and engage in the business activities of transferring or leasing these above-ground buildings.

Definite development targets shall be specified for tract development and there shall be definite construction projects that are intended to make use of the developed land.

Article 3 With respect to a project to attract foreign investment for tract development, the municipal or county people's government shall organize the drawing up of a tract development project proposal (or a feasibility study report, the same hereinafter). With respect to a tract development project which is to make use of 1,000 mu or less of arable land or 2,000 mu or less of other land and whose amount of investment for comprehensive development falls within the limits of powers for examination and approval of the people's government of the province, autonomous region or municipality directly under the Central Government (including the people's government or administrative committee of a special economic zone, the same hereinafter), the project proposal shall be submitted to the people's government of the province, autonomous region or municipality directly under the Central Government for examination and approval. With respect to a tract development project which is to make use of more than 1,000 mu of arable land or more than 2,000 mu of other land and whose amount of investment for comprehensive development exceeds the limits of powers for examination and approval of the people's government of the province, autonomous region or municipality directly under the Central Government, the project proposal shall be submitted, through the people's government of the province, autonomous region or municipality directly under the Central Government, to the State Planning Commission for examination, verification and overall balancing and then to the State Council of the People's Republic of China for examination and approval.

Article 4 Foreign investors who intend to invest for tract development shall, in accordance with the respective provisions of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures, the Law of the People's Republic of China on Chinese-Foreign Contractual Joint Ventures and the Law of the People's Republic of China on Foreign-Capital Enterprises, form a Chinese-foreign equity joint venture, or a Chinese- foreign contractual joint venture or a foreign-capital enterprise (hereinafter referred to as a "development enterprise") to engage in the development and management of the tract of land.

Development enterprises shall be governed and protected by the law of China and all their activities shall abide by the laws and regulations of the People's Republic of China. Development enterprises shall have the right to act on their own in business operations and management in accordance with the law, but they shall have no administrative power in their development areas. The relationship between a development enterprise and other enterprises shall be of a commercial nature.

The State encourages the state-owned enterprises to form development enterprises with foreign investors by using the right to the use of state- owned land as investment or condition of co-operation.

Article 5 Development enterprises shall obtain the right to the use of the state- owned land in their development areas in accordance with the Law.

In assigning the right to the use of State-owned land to a development enterprise, the people's government of the municipality or county where the development area is located shall, in accordance with the laws and administrative rules and regulations of the State on the administration of land, rationally specify the bounds of the tract of land, the purpose of its use, the term of assignment, the assignment fee and other conditions, sign a contract for assigning the State-owned land and submit it for approval in accordance with the limits of powers for examination and approval with respect to the assignment of the right to the use of State- owned land.

Article 6 After the right to the use of State-owned land has been assigned, the resources and objects buried thereunder shall continue to be owned by the State. If it is necessary to exploit and utilize them, the exploitation and utilization shall be administered in accordance with the pertinent laws and administrative rules and regulations of the State.

Article 7 A development enterprise shall draw up a tract development plan or a feasibility study report which shall specify the overall targets and respective targets for different stages, the specific details and requirements in the actual development, and the plan to utilize the developed land.

The tract development plan or feasibility study report shall, after examination and verification by the municipal or county people's government, be submitted to the people's government of the province, autonomous region or municipality directly under the Central Government for examination and approval. The examining and approving authorities shall organize the competent authorities concerned to provide co- ordination concerning the construction and management of the relevant public works.

Article 8 If the development area is within the limits of a planned urban area, the various items of development and construction shall be in conformity with the requirements of city planning and be submitted to the administration of the planning.

The various items of construction in a development area shall be in conformity with the laws, administrative rules and regulations and standards of the State concerning environmental protection.

Article 9 A development enterprise may transfer the right to the use of the state- owned land only after it has carried out the plan of tract development and satisfied all the conditions prescribed in the contract for assigning the right to the use of the state-owned land. No development enterprise that fails to invest for the development of the land in accordance with the conditions prescribed in the contract for assigning the right to the use of the state-owned land and the requirements of the plan for tract development may transfer the right to the use of the state-owned land.

The transfer or mortgage of the right to the use of state-owned land by development enterprises and other enterprises, and the termination of the right to the use of state-owned land shall be handled in accordance with the laws and administrative rules and regulations of the State on the administration of land.

Article 10 A development enterprise may attract investors to the development area to make investment, accept the transferred right to the use of state-owned land and launch enterprises. Enterprises with foreign investment shall be established in accordance with the respective provisions of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures, the Law of the People's Republic of China on Chinese-Foreign Contractual Joint Ventures and the Law of the People's Republic of China on Foreign-Capital Enterprises.

The launching of enterprises in the development areas shall be in conformity with the State policy concerning the investment in industries.

The State encourages the launching of technically advanced enterprises and export-oriented enterprises.

Article 11 The postal and communication undertakings in the development areas shall be placed under the unified planning, construction and management of the postal department. Or they may, with the approval of the province, autonomous region or municipality directly under the Central Government, be constructed with investment by a development enterprise; or the development enterprise and the postal department may pool their investment for the construction of communications facilities, which, in either case, shall be transferred, after completion, to the postal department for operation, with financial compensation to be given to the development enterprise in accordance with the contract signed between the two parties.

Article 12 Development enterprises that invest in public utilities of their own such as power stations, heat stations and water plants within the development area may operate the business of power, water and heat supplies within the development area or hand them over to the local enterprises of public utilities for operation. If the capacity of the public utilities is in surplus, which renders it necessary to be supplied to places outside the development area or to be connected to a network outside the development area for operation, the development enterprise shall sign a contract with the local enterprises of public utilities in accordance with the pertinent provisions of the State and operate in accordance with the conditions prescribed in the contract. If it is necessary for a development area to use water and power resources from outside, the business thereof shall be operated by the local enterprises of public utilities.

Article 13 If a development area covers a coastal port or bay, or a river port sector, the coastline or riverside line shall be placed under the unified planning and administration of the State. The development enterprise may construct and operate a special port area and wharf in accordance with the unified planning of the competent state communication authorities.

Article 14 No business activities or social activities that are banned by the laws and administrative rules and regulations of the State may be engaged within the development areas.

Article 15 If special administrative measures are required in respect of import and export administration and Customs administration for a development area which is mainly intended for the operation of export processing enterprises, these shall be submitted to the State Council of the People's Republic of China for approval and specific measures of administration shall be formulated by the competent authorities of the State.

Article 16 The general administration, judicial administration, port administration and Customs administration in a development area shall be organized and exercised respectively by the competent authorities of the State, the people's government of the locality where the development area is situated, and the judicial organs that have jurisdiction.

Article 17 Tract development with investment by firms, enterprises and other economic organizations or individuals from the regions of Hong Kong, Macao and Taiwan shall be governed with reference to these Measures.

Article 18 These Measures shall be put into effect within the limits of the specific economic zones, the open coastal cities and the open coastal economic zones as of the date of promulgation.