TRANSPORTATION AND RELATED SERVICES

Commercial Presence in China

Maritime Transport Services

  • Foreign suppliers of international maritime transport of freight and passengers (except cabotage transport services) may establish joint-venture shipping companies to operate under the Chinese flag, with a maximum foreign investment of 49 percent of the total registered capital of the joint venture. The enterprise’s board of directors and general manager must also be appointed by the Chinese side.
Auxiliary Services
  • Foreign suppliers of maritime cargo-handling services, customs clearance services for maritime transport, and container station and depot services, may form joint ventures with foreign majority ownership permitted. 
  • Foreign suppliers of maritime agency services may form joint ventures with a maximum  foreign investment of 49 percent.
Air Transport Services
  • Foreign suppliers may establish joint ventures for the provision of aircraft repair and maintenance services in which the Chinese side holds controlling shares or is in a dominant position. 
  • The issuance of licenses to these joint ventures can be subject to economic needs tests.
  • These joint ventures are obliged to undertake business in the international market.
  • China reserves the right to place market access and national treatment restrictions on foreign suppliers of computer reservation system services.
Rail and Road Transport Services
  • Foreign service suppliers may provide freight transport by rail or road through joint ventures with a maximum foreign investment of 49 percent.
  • Foreign majority ownership of rail transport enterprises will be permitted by December 11, 2004. By December 11, 2007, wholly-owned foreign subsidiaries will be permitted.
  • Foreign majority ownership of road transport enterprises will be permitted within one year after accession. By December 11, 2004, wholly foreign-owned subsidiaries may be established.
Storage, Warehousing, and Freight Forwarding Services
  • Foreign service suppliers may provide storage and warehousing services through joint ventures with a maximum foreign investment of 49 percent. Foreign majority ownership will be allowed within one year after accession. Within three years after accession, wholly foreign-owned subsidiaries will be permitted and any remaining market access restrictions will be removed.
  • Foreign freight forwarding agencies with at least three consecutive years of experience may set up a joint venture in China, with a maximum foreign investment of 50 percent. Foreign majority ownership will be permitted within one year after accession. By December 11, 2005, wholly foreign-owned subsidiaries may be established.
  • Minimum capital required for a freight forwarding joint venture shall be at least $1 million. By December 11, 2005, national treatment will be accorded with respect to minimum capital requirements.
  • Freight forwarding joint ventures may establish branches after operating in China for one year. An additional $120,000 must be added to the original registered capital of the joint venture for the establishment of each branch. By December 11, 2003, this additional capital requirement will be implemented on a national treatment basis.
  • A foreign freight forwarding joint venture may set up a second joint venture after the first one has operated for five years. By December 11, 2003, this requirement will be reduced to two years.
  • Freight forwarding joint ventures may operate for no more than 20 years.
Presence of Natural Persons in China
  • Managers, executives, and specialists of a representative office, branch, or subsidiary in China, temporarily moving as intra-corporate transferees, will be permitted an initial stay of three years.
  • Managers, executives, and specialists of foreign-invested enterprises in China will be granted a long-term stay permit as stipulated in the terms of contracts concerned or an initial stay of three years, whichever is shorter.
  • Service salespersons who are not based in China, and who meet certain other conditions set forth in China’s services schedule, are limited to a 90-day stay. 
Cross-Border Supply of Services

Maritime Transport Services

  • The cross-border supply of liner shipping (including passenger transportation) and bulk, tramp, and other international shipping (including passenger transportation) services by a foreign supplier is not subject to market access restrictions and is accorded national treatment.
Auxiliary Services
  • China reserves the right to place market access and national treatment restrictions on the cross-border supply of maritime cargo-handling services, customs clearance services for maritime transport and container station and depot services due to lack of technical feasibility.
  • The cross-border supply of maritime agency services is not subject to market access restrictions and will be accorded national treatment.
Air Transport Services
  • After signing agreements with Chinese aviation enterprises and the Chinese Computer Reservation System (CCRS), foreign computer reservation system suppliers may provide services to Chinese aviation enterprises and agents by connecting with the CCRS. 
  • Foreign computer reservation system suppliers may provide services to representative offices and sales offices established in the cities in China that foreign aviation enterprises serve in accordance with bilateral aviation agreements.
  • Direct access to and use of foreign computer reservation systems by Chinese aviation enterprises and agents of foreign aviation enterprises are subject to approval of the General Administration of Civil Aviation of China (CAAC).
Rail and Road Transport Services
  • The cross-border supply of these freight transport services by a foreign supplier is not subject to market access restrictions and is accorded national treatment.
Storage, Warehousing, and Freight Forwarding Services
  • China reserves the right to place market access and national treatment restrictions on the cross-border supply of foreign storage and warehousing services. 
  • The cross-border supply of foreign freight forwarding agency services is not subject to market access restrictions and is accorded national treatment.
Acquired Rights of Foreign Service Suppliers
  • The conditions of ownership, operation and scope of activities for an existing foreign service supplier, as set out in the supplier’s contract or shareholders’ agreement or in a license establishing or authorizing the supplier’s operation or supply of services, will not be made more restrictive than they were on December 11, 2001.
Other Commitments

Maritime Transport Services

  • The following services will be available to international maritime transport suppliers on reasonable and non-discriminatory terms and conditions: pilotage; towing and tug assistance; provisioning fueling and watering; garbage collection and ballast waste disposal; Port Captain’s services; navigation aids; shore-based operational services, including communications, water and electrical supplies; emergency repair facilities; and anchorage, berth and berthing services.
Internal Waterways Transport Services
  • Only international shipping in ports open to foreign vessels is permitted.

December 2001
Department of Commerce
International Trade Administration
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