The development of enterprises with foreign investment shall be encouraged and the rational assets flow be promoted;

(1) Enterprises whose promised capital can be in place in good time or whose products are in demand are encouraged to establish subsidiary companies. They are also encouraged to conduct associate operation with domestic enterprises and establish new enterprises with foreign investment. They are especially encouraged to conduct reorganization of assets and accomplish the transformation of operational style of state-owned enterprises in the form of purchasing, shareholding, leasing or merger, etc.

(2) Mutual transformation between domestic and foreign assets shall be advocated and the reorganization of domestic and foreign assets be promoted. The transformation between domestic and foreign assets shall be treated as registration of changes without any charge of registration for the opening of business (with the exception when the registered capital is increased).

Enterprises with foreign investment are encouraged and supported to open producer’s goods markets, factor markets and other indoor markets of new type.

Relax the control of names and business scope of enterprises with foreign investment:

(1) Enterprises of key projects with the registered capital of at least $2 million may be named after major classifications of the trade. A domestic enterprise purchased or acquired by any foreign investor may either apply a new name or continue to use the original name.

(2) Enterprises with the promised capital being in place in time and with satisfactory productive and operational results or making additional investment may, with the approval of the authorities concerned, operate business in other trades as approved by the state.