Problems relating to Trade and Investment on China
23. Inefficient administrative procedures, regimes and practices |
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Issue |
Issue details |
Requests |
Reference |
| (1) Complexity in acquisition of the Consulate General's Validation | - GOC requires Consulate General's Legalisation (CGL) upon filing power of attorney, exhibits related to the court proceedings, etc. It takes two-trips to the embassy to obtain CGL. The procedures are complex and time-consuming. | - It is requested that GOC: -- dispenses with the CGL requirements, and -- accepts the apostille in lieu of CGL. - As affairs now stand, the scope of application is restricted to Hong Kong and Macao. It is requested that GOC expands its application to the mainland PRC. |
- Expanded application of Hague Convention (of 5 October 1961 Abolishing the Requirement of Legalisation for Foreign Public Documents) to the mainland PRC. - Regulation on the Administration of Registration of Resident Representative Offices of Foreign Enterprises |
| (2) Administrative Guidance not Stipulated into Law | - In processing the change of company name (which took 2-1/2 months for acquisition of business licence ), a Firm received various requirement from various Ministries and Agencies, such as the new company name itself, capital increase, change in Articles of Association, unrelated to or outside the scope of legislative provisions. The authority's view varies by regions, and by wards of the same region, (for example, treatment of VAT refund procedures in the bonded zone, etc.). | - It is requested that GOC promulgates detailed implementing rules, which are circulated universally nationwide, instead of leaving the ambiguity of the basic laws and regulations. | |
| (3) Regional Disunity in Employment and Interpretation of Legislation | - Concerning administration on safety of hazardous chemicals, large gaps exit in employment, interpretation, etc. of the same law among the competent authorities at individual locations. It is impossible to apply the same method to all competent authorities. (It requires optimum individual preparation at increased cost.) | - It is requested that GOC eliminates the regional gaps in implementing laws and regulations. | - Measures for the Administration on Safety of Hazardous Chemicals - Measures for the Administration on Registration of Hazardous Chemicals - Chinese Laws and Regulations |
| (4) Arbitrariness of the Local Governmental Authority's Licenses and Permits | - A member firm's subsidiary in PRC, owner of nursery garden, must go through the ordeal of numerous negotiations in order to obtain the licence for production at its nursery garden, as some officials in the Provincial Government hold the view that eucalyptus trees are counter-protective to the environment. | - It is requested that GOC: -- refrains from revoking the MFS's business licence for no reason, and -- deepens its correct appreciation of nursing eucalyptus trees. |
- Company Law - Law on Foreign Investment Company |
| (5) Nebulous authorisation basis of Maintenance Contractors for Fire Fighting Equipment | - Since 2013 in Suzhou City, it has become necessary to contract 2-kinds of contractors for maintenance of firefighting equipment. One performs maintenance while the other checks the effectiveness of maintenance, each authorised by Defence Bureau. However, to outsiders, it is difficult to distinguish the difference of the respective authorisation bases (as they resemble each other). Employment of two contractors has increased the maintenance cost from RMB2.00/sq.mt. to RMB3.00/sq.mt. | - It is requested that GOC cancels the 2nd contractor for checking the effectiveness of maintenance, holding the 1st contractor responsible for checking the effectiveness of maintenance. - It is requested that Defence Bureau will penalize the 1st contractor, should it fail its sampling inspection (after the fashion of design responsibility for buildings in regard to fire prevention). |
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| (6) Arbitrary and Time Consuming Administrative Procedures | - In December 2013, a Member Firm signed with its Chinese party, in Beijing city, joint venture agreement, which has been under negotiation between Beijing Municipal Commission of Commerce (BMCC) and Member Firm since May 2014 until now, for acquisition of foreign invested company license. Member Firm has received BMCC's suggested amendment in the wordings of the proposed agreement for plural times. Nevertheless, even the corrections made verbatim in accordance with the BMCC official's intent, Member Firm has received the same amendment request again. It reflects the abnormal nature of the BMCC personnel in charge. Seven months have lapsed since the beginning of consultation with BMCC. This is the longest record in the history of the attorney's office retained by the Member Firm, and yet the negotiation continues even now. - From time to time, it takes a lot of time for handling governmental procedures at tax office, SAFE, customs, etc. due to the change in officer in charge, etc. The same explanation must be given to another personnel. |
- It is requested that BMCC secures transparency in its provision of sufficient and proper explanation. - In lieu of "personal" governance, it is requested that MBCC will respond in the manner fit for a State governed by law, not by persons. () No evidential documents are available, as the circumstances described reflect only the verbal exchanges with the BMCC official at the window. Joint venture agreement cannot be produced for reason of protecting confidential information. - It is requested that GOC (to enquires as to the progress status, etc.): -- arranges taking over to another personnel, -- gives timely, and documented or other clear-cut feedback. |
- Company Law - Law on Chinese-Foreign Equity Joint Ventures |
| (7) Confusion due to the CIQ(Custom, Immigration, Quarantine) Guidance at the Window | - Under CIQ's specific instructions at the window, MFS entered its address not at the company's registered address, but at its office address. Consequently, for the sake of maintaining uniformity, its office address had to be shown, on the country of origin certificate, commercial invoice, and price list. In order to revert back to the correct address, MFS has had to spend several months for the change of address by filing a formal request to CIQ. - Telephoning is the only means available for making enquiries to CIQ on system, control, etc. However, it takes a lot of time and effort before reaching the correct department and the person in charge. |
- It is requested that CIQ discontinues its irresponsible/ extraneous instructions at the window and gives more realistic instructions. - It is requested that GOC deploys a person fully versed with the internal organisation/function, able to understand requests at the phone desk. |
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