Guidelines
¡ï The newly-revised Measures for Administration of Trust and Investment Companies was promulgated
¡ï Customs Supervised Area set up in Shanghai Jinqiao Export Processing Zone
¡ï Latest Laws and Regulations
Regulations on IP of the Achievements in Scientific Research Projects of the State
Notification on Rectifying and Regulating the Order in Real Estate Market
Encouraged Policies on Establishing Businesses by Returned Personnel:
Nation-wide: Several Opinions on Encouraging Returned Personnel to Serve the Nation in various ways
Shanghai: The special capital aiding returned personnel to establish businesses of software and integrated circuit layout-designs was set up
Xiamen: "Rules of Xiamen Special Economic Zone on Encouraging Returned Personnel to Establish Businesses and Work in Xiamen " came into force.

The newly-revised Measures for Administration of Trust and Investment Companies was promulgated

"The newly-revised Measures for Administration of Trust and Investment Companies" was promulgated by People's Bank of China on June 5, 2002 and came into force on the same date. The revised edition embodies characteristics as follows:

1.Be consistence with "Trust Law of the People's Republic of China"in expression. For example, "owned assets" was regulated as "fixed assets"; types of public interest trusts and conditions on termination of trust conformed to the expression in Trust Law

2. The regulations on trust companies' operation have been more conformed to the standard.
(1) The regulation that it should be approved by People's Bank of China to set up new types of trust business was canceled.
(2) The following compulsory items was supplemented in the trust contract: the scope of business for trustee; report on trust affairs; the way of election for new trustee; moreover, the calculation and payment on trust benefit and reward for trust company, as well as rights and obligations of both sides are also specified.
(3) The company registration department shall implement annual examination, instead of People's Bank of China's. It is noticed that the license for trust institutions should still be applied to People's Bank of China's.

3. Enlarging the scope of trust business:
(1) Broadening the scope of trust assets. A trustor is authorized to entrust a trustee with his legal-owned capital according to the new regulation.
(2) Be authorized to carry out investment fund business. According to law and regulations, trust companies can be allowed to become sponsors for investment fund.
(3) Broadening the bonds underwriting business. Trust companies are authorized to engage in underwriting bonds of bank.
(4) Broadening the demand to trust assets to comply with the development of financial market. The total balance of trust assets is no longer limited within 10 times of registered capital.

With "Trust Law of the People's Republic of China" promulgated last year ,as well as "The newly-revised Measures for Administration of Trust and Investment Companies" issued recently, trust business in China will step into a new phase and have a regulated development.

Customs Supervised Area is set up in Shanghai Jinqiao Export Processing Zone

The people's Government of Shanghai Municipality issued the "Interim Procedure of Administration of Customs Supervised Area of Shanghai Jinqiao Export Processing Zone" on 27th of March 2002, which shall come into force on 10th April, 2002.

Customs Supervised Area of Shanghai Jinqiao Export Processing Zone (referred as Supervised Area) is established with the approval of the State Council in September 2001, which is located in the southern area of Shanghai Jinqiao Export Processing Zone and administered by the Customs in a closed manner. Pursuant to the entrustment or authorization of the relevant regulations and governmental agencies, Supervised Area shall be administered by the Administration Commission of the Customs Supervised Area of Shanghai Jinqiao Export Processing Zone(referred to as the Administration Commission).

The Administration Commission is authorized by Shanghai Foreign Investment Working Commission, and shall approve, review and confirm the relevant foreign-invested projects and enterprises to be established in the Supervised Area, and submit to the relevant executive administration departments for record.

1) to approve projects that fall into the encouraged category by the State;
2) to approve projects with a total investment amount below US dollar 30 million that fall into the permitted category by the State;
3) to approve changes to contract and articles of association of foreign-invested enterprises pertinent to Section 1) and 2) of this article;
4) to examine and approve the import of self-use equipment of foreign invested enterprises;
5) to determine and assess export-oriented foreign-invested enterprises.

It will be more convenient to set up an enterprise in the Supervised Area and the direct registration procedure will be adopted. If any preceding approval is required in accordance with the relevant laws and administrative regulations, the relevant departments shall follow the procedure of "Acceptance by the Administration for Industry and Commerce, Report to the relevant authorities, Parallel approval and completion within stipulated time limit."

The regulation also stipulated other matters to manage the Supervised Area, like the customs issues, approval and planning of construction projects, construction project administration, environment protection, city appearance and environment sanitation management, labor and personnel management etc.

Latest Laws and Regulations

Regulations on IP of the Achievements in Scientific Research Projects of the State The regulations were instituted by The Ministry of Science and Technology and The Ministry of Finance, which took some measures to speedup the transformation of achievements in scientific research. According to the regulations, achievements in scientific research projects and its IP are awarded to the units taking on the projects, which have legitimate decision-making power involving performing, licensing, transforming, becoming a shareholder through evaluation etc, and make relevant profits. Government will take intervention if the achievements aren't timely transformed.

Generally, the units taking on the projects bear the expenses for transacting IP affairs, including application fee, maintaining fee etc. Approved by The Ministry of Finance, the expenses for transacting IP affairs may be listed from the expenses of scientific research projects.

The regulations also further encourage research and development personnel to carry out tech-innovation and transformation of Achievements positively. Moreover, the units taking on the projects should be awarded encouragement and reward to the person who made the achievements or contributed to the transformation of achievements. When the units transfer IP of the Achievements, the maker should be the first transferee under the same condition.

Notification on Rectifying and Regulating the Order in Real Estate Market
The notification was issued by 6 ministries including Ministry of Construction, demanding carry out regularization to disorder in real estate market, especially to such problems as illegal operation, false advertisement, etc. The notification regulates that counting the price by suite or the inner building area of house to sales of commodity housing should be implemented positively. Counting the price by building area, real estate developers should clearly indicate the inner building area of the house and its shared building area to customers. With regard to a sales contract specifying difference of area, two parties are bound to the agreement. With regard to no agreement in contract, a buyer has right to cancel the contract when the final acreage exceeds or less 3 percent of the contract acreage. If a buyer doesn't choose to cancel, he should complement the part of price within 3 percent (inclusive) and the exceeded part should be assumed by real estate developers and ownership is attributed to the buyer when the final acreage exceeds contract acreage. When the final acreage less than contract acreage, real estate developers should return the part of price within 3 percent proportion of area deviation (inclusive) to buyer and the exceeded part should be double-returned.

Encouraged Policies on Establishing Businesses by Returned Personnel:
"Several Opinions on Encouraging Returned Personnel to Serve the Nation in various ways" was issued by Ministry of Personnel and Ministry of Education etc. on Aug 19, 2001, encouraging returned personnel serve nation in various ways. The encouraging policies are as follows: encouraging to establish businesses by way of transforming patent, know-how and achievements in scientific research and becoming a shareholder; establishing professional consultant firms with knowledge, skills, information, etc; Investing domestically by owned capital or introduced capital. Moreover, the state and other government should supply returned personnel with guaranteed politics. From this year on, many places have issued politics encouraging returned personnel to establish businesses.

The special capital aiding returned personnel to establish businesses of software and integrated circuit layout-designs was set up in Shanghai on Jun 1, 2002. According to measure, any returned person who has 8 years overseas studying and working experience and owns registered capital over RMB 500,000 is qualified to apply for registration. To the qualified applicants, the total sum of financial aiding is RMB 100,000. Therefore, Shanghai's bureau of personnel has also set up service office, completing examination and approval within 10 weekdays after receiving applicants' materials.

"Rules of Xiamen Special Economic Zone on Encouraging Returned Personnel to Establish Businesses and Work in Xiamen" came into force on June 1, 2002, providing preferential policies for returned personnel to establish businesses. The preferential treatments includes: setting up special capital for returned personnel; be qualified to apply for fostering capital; exempted from rental fee. Besides, enjoying a series of preferential treatments for high-tech industry, fees for examination and approval, registration with AIC and tax certificate fee are all exempted. Moreover, registered capital for limited company can be lowered to RMB 30,000 or equal exchangeable foreign currency. As for the share invested by scientific and technological achievements, the proportion of the achievements-evaluated sum in registered capital isn't restricted. In accordance with the rules, those returned personnel with high technical post or doctor's degree working for institutions can enjoy personal subsidies for at least RMB 1,500.