The Standing Committee of the 14th Jiangsu Provincial People's Congress approved the Regulation on the Promotion and Protection of Foreign Investment in Jiangsu Province during its fifth session on September 27.
Set to take effect on January 1 next year, the regulation aims to bolster investment promotion mechanisms, safeguard investor rights and interests, and improve service measures.
The province ranked first nationwide last year in actual use of foreign investment and retained this position in the first half of the year. It’s expected that the regulation can further solidify Jiangsu’s leading position in foreign trade and foreign investment within the country.
Sun Jin, deputy director of the province’s Commerce Department, highlighted the pivotal role of foreign investment in Jiangsu’s economic and social development.
"Although foreign-funded enterprises only account for 1.3% of the total number of companies in Jiangsu, they contribute to 10% of total fixed asset investment, 10% of urban employment, as well as 20% of tax revenues, being instrumental in advancing industrialization, urbanization, market development, rule of law, and international practices," said Sun.
“However, improvements are needed in the quality of foreign investment and business environment through a legal approach,” Sun added.
According to the regulation, foreign-invested enterprises shall receive equal treatment in government procurement, standard-setting, development of R&D platforms, and application for government S&T programs.
The regulation clarifies the role of pilot free trade zone in pioneering new initiatives, encourages qualified foreign investors to establish investment companies, and urges foreign-invested enterprises to reinvest with their profits.
To refine the business environment, the regulation specify that governments at or above the county level must establish coordination mechanisms to fulfil the legal responsibilities. Departments of commerce, development and reform shall help create a stable, fair, transparent and predictable business environment.
Governments at all levels are required to honor their commitments, coordinate administrative and judicial efforts for the protection of intellectual property rights, and enhance the protection of trade secrets and personal information, as specified in the regulation.
The regulation also requires the establishment of a sound complaint mechanism for foreign-invested enterprises, improve the diversified dispute resolution mechanisms, and support exploration of innovative arbitration measures.
In addition, it encourages financial institutions to provide multi-channel financing for foreign-invested enterprises, while streamlining the approval process for foreigners' work permits and residence permits, and facilitating services for qualified foreign talents.
