(Promulgated by the State Administration of Import and Export Commodity Inspection and the Ministry of Foreign Trade and Economic Cooperation on October 9, 1995)

Article 2 The foreign-funded import and export commodities inspection and appraisal enterprises mentioned in this set of Regulations refer to foreign funded enterprises established as Sino-foreign joint equity or cooperative ventures engaging in inspection, appraisal and certification of import and export commodities as a third party under the consignment of consignors and consignees or other related parties, hereinafter referred to as FFCIEs.

Article 3 Joint venturing FFCIEs but not wholly foreign-owned ones are allowed to be set up in the territories of China.

Article 4 With official approval, FFCIE can engage in all or part of the operations listed below:

Inspection, appraisal and certification on consignment of quality, specifications, quantity, weight, package, damage, value and technical conditions of shipment of import and export commodities.

Article 5 The Chinese investor in an FFCIE should be an enterprise engaged in the inspection and appraisal of import and export commodities with approval or consent, or by appointment, of the department in charge.

The foreign investor in an FFCIE should be an enterprise which has more than three years of experience in the import and export commodity inspection, appraisal and certification business, accommodated with qualified managerial, professional and technical personnel and technical equipment for the work, a relatively steady clientele of its own and a fairly good international reputation.

Article 6 The registered capital of an FFCIE should not be less than US $500, 000. It should have a fixed working site and the technical conditions and professional personnel suitable for its business operations.

Article 7 The operational term of an FFCIE is generally not more than 30 years.

Aticle 9 Procedures for the establishment of an FFCIE:

1. The Chinese partner submits an application for the establishment of the FFCIE together with the related documents to its higher authorities. After agreed by the authorities, the local foreign trade and economic cooperation department, having consulted the local SCIA office, will send the application with its own comments and report to MOFTEC. If the applicant is an enterprise directly under a ministry, commission or bureau of the State Council, it should submit the application with related documents for the establishment of an FFCIE to its higher authorities and, after having agreed by the higher authorities, report the application to MOFTEC which, on receiving will consult SCIA on the documents.

3. Having received an affirmative reply from SCIA, MOFTEC will examine the documents sent in. After it has approved the project, MOFTEC will issue a certificate of approval of a foreign-funded enterprise.

4. The Chinese partner, with the MOFTEC certificate of approval of a foreign-funded enterprise and other relevant documents, applies to industrial and commercial administrative offices for business registration to get the business license.

5. With the certificate of approval and the business license, the FFCIE has to get the qualification certificate for FFCIE at SCIA before it can formally open for business.

1. Comments of the local foreign trade and economic cooperation department or a ministry, commission or bureau of the State Council to the application for the establishment of an FFCIE.

2. The project proposal for the proposed FFCIE.

3. The feasibility study report, contract and articles of association signed by all parties concerned.

4. Certificates of credit status, business registration (duplicates) and legal representation (duplicates) of all parties to the project.

5. Other documents as requested by MOFTEC.

Otherwise specified as duplicates, all the documents should be the original. The unofficial representative who has signed the documents should produce the document of authorization by the legal representative for acting on his /her behalf.

Article 11 The establishment of subsidiary setups of FFCIEs shall be handled according to this set of Regulations.

Article 12 A FFCIE will have to renew the procedures of application for approval according to this set of Regulations on one of the following circumstances:

1. A change in the partnership.

2. A change in the scope of business.

Article 13 FFCIEs established before the promulgation of this set of Regulations, should, within three months of the promulgation of the Regulations, apply to SCIA for the issue of the qualification certificate for FFCIE by presenting the certificate of approval of a foreign-funded enterprise issued by MOFTEC or its authorized department. Those which refuse to make the application over the prescribed time limit are not allowed to contract business related to the inspection, appraisal and certification of import and export commodities.

Article 14 Local foreign trade and economic cooperation departments shall seek the agreement of local SCIA offices before they approve foreign-funded enterprises engaging in consulting services related to the inspection, appraisal and certification of import and export commodities. The approved cases have to be reported to MOFTEC and SCIA for record.

Article 15 This set of Regulations comes into force upon promulgation.