Encouraging Foreign Investors' Establishment of For-Profit Elderly Care Institutions in China
· Document Number：Announcement No. 81  of the Ministry of Commerce and the Ministry of Civil Affairs
· Area of Law： Civil Law
· Level of Authority： Departmental Regulatory Documents
· Date issued：11-24-2014
· Effective Date：11-24-2014
· Issuing Authority： Ministry of Commerce Ministry of Civil Affairs
· Status： Effective
Announcement of the Ministry of Commerce and the Ministry of Civil Affairs
(No. 81 )
Announcement on Encouraging Foreign Investors' Establishment of For-Profit Elderly Care Institutions in China to Provide Elderly Care Services
To promote the sound development of the elderly care service industry in China and the opening-up of the social service industry, and further implement the Decision of the Central Committee of the Communist Party of China on Several Major Issues concerning Comprehensively Deepening the Reform and Several Opinions of the State Council on Accelerating the Development of the Elderly Care Service Industry (No. 35 , State Council), and in accordance with the Law on Chinese-Foreign Equity Joint Ventures, the Law on Chinese-Foreign Cooperative Joint Ventures, the Law on Foreign-Funded Enterprises, the Law on the Protection of the Rights and Interests of the Elderly, the Measures for Licensing the Establishment of Elderly Care Institutions and other relevant laws, regulations and departmental rules, the matters relating to the establishment of for-profit elderly care institutions in China by foreign companies, enterprises and other economic organizations or individuals (hereinafter referred to as “foreign investors”) to provide elderly care services are hereby announced as follows:
I. Foreign investors are encouraged to establish for-profit elderly care institutions independently or with Chinese companies, enterprises and other economic organizations in the form of an equity or contractual joint venture.
II. Foreign-funded for-profit elderly care institutions shall abide by the relevant laws, regulations and rules, aim at providing social services, pay taxes in accordance with law and conduct business operations in accordance with regulations, and their lawful business operations and the lawful rights and interests of capital contributors shall be protected by law.
III. To establish a for-profit elderly care institution, a foreign investor shall submit the materials on the application for the formation of a foreign-funded enterprise to the provincial commerce department at the place where the to-be-established institution is located (the competent commerce department of a province, autonomous region, municipality directly under the Central Government, city under separate state planning or Xinjiang Production and Construction Corps):
(1) A written application for formation.
(2) An explanation on the situation (including places, security, medical care and other content).
(3) Contracts and bylaws (bylaws if a foreign-funded enterprise is to be established).
(4) List of members of the board of directors and the letters of appointment of the directors.
(5) A written notice on name pre-confirmation.
(6) An explanation and certification documents on the practicing experience of the foreign investor or actual controller, or an explanation on the recruitment of a management team with elderly service industry business management experience.
(7) Other materials that shall be provided in accordance with laws, regulations and rules.
IV. The provincial commerce department shall, within 20 days after accepting an application, make a written decision to approve or disapprove the application; and if it approves the application, shall issue the Approval Certificate for a Foreign-Funded Enterprise, and indicate “business operation upon the license for the formation of an elderly service institution” in the business scope; and give reasons if it disapproves the application.
V. A foreign investor shall, within one month after obtaining the Approval Certificate for a Foreign-Funded Enterprise, undergo the formalities for the registration of foreign-funded enterprises at the administrative department for industry and commerce.
VI. A foreign-funded enterprise shall, after its registration, legally apply for and obtain the license for the formation of an elderly service institution in accordance with the Measures for Licensing the Formation of Elderly Care Institutions and other relevant provisions. A foreign-funded for-profit elderly care institution or a foreign investor shall not, before obtaining the aforesaid license and is approved to be registered in accordance with law, provide elderly care services, and shall not charge any fees in any name and receive the elderly.
VII. Foreign investors are encouraged to participate in the corporate restructuring of state-run elderly care service institutions that specially provide operating services to the society, and shall appropriately handle the issues such as the protection of employees' interests and the value preservation and increment of state-owned assets during the restructuring process.
VIII. Foreign-funded for-profit elderly care institutions may engage in domestic investment relating to elderly care services, and foreign investors are encouraged to develop large-scale and chain operation of elderly care institutions, and develop good elderly care institution brands.
IX. Foreign-funded for-profit elderly care institutions shall enjoy equal taxation and other preferential policies and the policies on the reduction or exemption of administrative fees as any for-profit elderly care institutions formed by domestic investors.
X. All localities shall not approve the establishment of foreign-funded real estate enterprises by modifying the uses of land for the construction of elderly care facilities, plot ratio and other service conditions. Foreign-funded for-profit elderly care institutions shall not engage in residential discount endowment and other businesses.
XI. Where the business scope of a foreign-funded for-profit elderly care institution includes medical care services, the institution shall perform approval formalities according to the relevant policies.
XII. Provincial commerce departments shall enhance the statistics of foreign-funded for-profit elderly care institutions, and when issuing the approval certificates, select “elderly care services for the elderly and disabled” in the Industry Category (paragraph 8414 of the Classification of Industries in National Economy).
XIII. Foreign-funded for-profit elderly care institutions formed in accordance with this Announcement shall participate in the joint annual declaration made by foreign-funded enterprises on schedule.
XIV. The requirements of this Announcement shall apply, by reference, to the formation of for-profit elderly care institutions by investors in the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and the Taiwan region, and in the case of any discrepancy between this Announcement and the previous provisions, this Announcement shall prevail.
XV. In case of any problem encountered in the implementation hereof, all local commerce and civil affairs departments shall contact the Ministry of Commerce and the Ministry of Civil Affairs in a timely manner.
Ministry of Commerce
Ministry of Civil Affairs
November 24, 2014