1.1 Policy on Domestic Sale of FIE Products
In 2000, the Chinese government amended the relevant laws and regulations related to investment by foreign companies, removing the restriction on the domestic sales ratio of the products produced by foreign-invested enterprises (FIEs - including foreign wholly-owned, equity joint-venture and contractual joint-venture enterprises). The Law of the People's Republic of China on Foreign Capital Enterprises revised on 31 October 2000 has lifted the requirement for FIEs to export all or most of their products. Subsequently, the Implementation Rules of the Foreign Capital Enterprises Law have also removed the restriction on domestic and foreign sales ratio. Hence, foreign-invested production enterprises are free to sell their products locally in China, or they may appoint other commercial entities to do so. In other words, FIEs now have the same autonomy as other types of enterprises in China in selling their products locally or exporting to overseas markets.
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