Following the issue of Decrees of 113 and 114 regulating the foreign invested construction and engineering design sectors, the Ministry of Construction of PRC (MOC) has recently proposed new vehicles open to foreign engineering services companies.
On 19 September 2005, the MOC published a draft of the Administrative Regulations on Foreign Invested Construction Engineering Services Enterprises (the "Regulations") for public comment. The Regulations proposed to allow foreign engineering services companies to set up three types of foreign invested engineering services enterprises ("FIESEs"), namely construction supervision,tender agent services and cost consultancy enterprises. This is a further step to open up the market for engineering services in accordance with China's commitments to the WTO. It is proposed under the Regulations that foreign companies may apply for the setting up of joint venture FIESEs when the Regulations come into effect and of the wholly foreign owned FIESEs from 11 December 2006 (when China celebrates the fifth anniversary of its entry to the WTO).
The Regulations will for the first time provide a clear channel for foreign engineering services companies to set up FIESEs in China, which has received a favorable response, in particular from those companies that have already established project management consultancy entities in China. Prior to the end of 2004, it was a common understanding that these consultancy entities were allowed to provide project management services without holding any specific skill qualification. However, since the issue by the MOC of Directive 200 (the Provisional Measures on Construction Management) in November 2004 requiring entities providing construction project management services to possess certain skill qualifications (namely survey, design, construction, construction supervision, tender agent services or cost consultancy), these consultancy entities have received constant queries from their clients or prospective clients on whether they are in a position to legally enter into contracts to provide project management services. The Regulations will allow foreign engineering services companies to set up FIESEs or restructure their existing entities into FIESEs. We understand that some of these consultancy entities are keen to restructure themselves into FIESEs and the purpose of the restructure is not only to satisfy the requirements of Directive 200 but also to bring their practice in line with the existing skill qualification regime as a further step to ‘go localized’ in the China construction industry.
Similar to Decrees 113 and 114, the Regulations have not specified all the requirements for applying for the relevant skill qualifications and they refer the foreign applicants to the requirements (including the registered capital, technical personnel and track record) as set out in the regulations and rules currently applicable to domestic companies. These requirements are generally not as difficult to satisfy as the requirements for construction and design skill qualifications.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
An actuarial review of the Invensys Australia Superannuation Fund showed it to be in surplus to the tune of $189.2 million. In mid 2003, the Invensys Group proposed to the trustee that the surplus be repatriated to the principal employer in the group.
As per a 2015 survey by Nasscom (the National Association of Software and Service Companies) India has paved the way to secure the third position in the world with three to four startups emerging every day, primarily in the areas of e-commerce, consumer services and aggregators.
The NSW Supreme Court held that the accountant was not liable for the investment losses suffered by its client.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).