Recently, the Ministry of Transport of the People’s Republic of China issued the Announcement on Piloting Several Policies on Sea Transportation at National Pilot Free Trade Zones, in accordance with which, under the approval of competent authority of transport under the State Council, Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures established in the free trade zones may deal with public and international shipping agency business and the foreign capital stock proportion may be raised to 51%.

 

In accordance with the announcement, under the approval of competent authority of transport under the State Council, Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures may be established in the free trade zones at any stock proportion to deal with international shipping business through the Chinese ports. Foreign-funded enterprises may be established in China (Shanghai) Pilot Free Trade Zone, while Hong Kong and Macao sole proprietorship enterprises may be established in China (Guangdong) Free Trade Zone. Foreign-funded enterprises established in free trade zone may deal with cargo handling as well as container station and storage services for international sea transportation.

 

In addition, under the approval of competent departments of transport of the provinces where the free trade zones were established, foreign-funded enterprises established in the free trade zones may deal with international ship management business. Concerning the Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures established in the free trade zones to deal with international shipping business, chairpersons of the board of directors and general managers shall be appointed through discussion of the Chinese and foreign parties.

 

The announcement requires that the Chinese-funded shipping companies shall not sublease the ships registered for the pilot business to any other parties without approval as required. Any ships without the Five-Starred Red Flag other than those registered based on the announcement shall not undertake shipping of container cargos between the Chinese ports, including not undertaking shipping of container cargos for foreign trade through a process of loading at one Chinese port and then transferring through another Chinese port to overseas, or a process of transferring to China through a Chinese port and then unloading at another Chinese port.

 

Source: www.moc.gov.cn, June 9, 2015