China Launches Pilot Scheme for Value-added Telecom Services
China has officially launched the pilot scheme for further opening up of value-added telecom services in the entire regions of Beijing, Hainan Free Trade Port and Shenzhen, along with Lingang New Area of the China (Shanghai) Pilot Free Trade Zone and the pioneer area for socialist modernization in Shanghai (Pudong New Area of Shanghai City) at the end of 2024.
The restrictions on the foreign equity ratio for the following value-added telecom services are removed in the pilot areas:
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internet data centers (IDC)
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content delivery networks (CDN)
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internet service providers (ISP)
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online data processing and transaction processing
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information publishing platforms and information delivery services (excluding services related to internet news information, online publishing, internet audio-visual program, internet cultural operations)
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information protection and processing services
According to the announcements of Beijing, Hainan and Shenzhen Communications Administration, the minimum registered capital required for the foreign invested enterprises intended to participate the pilot scheme is as follows:
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The registered capital of those who operate internet data centers (IDC), content distribution networks (CDN), internet service providers (ISP) businesses nationwide or across provinces, autonomous regions, and municipalities directly under the central government shall not be less than RMB10 million.
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For those applying to carry out other businesses, the registered capital shall not be less than RMB1 million.
The minimum registered capital of the pilot foreign invested enterprises required by Shanghai Communications Administration is different from that of Beijing, Hainan and Shenzhen, which is as follows:
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For businesses operating within the provinces, autonomous regions, and municipalities directly under the central government, the minimum registered capital required is RMB1 million.
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For businesses operating nationwide or across provinces, autonomous regions, and municipalities directly under the central government, the minimum registered capital required is RMB10 million.
Foreign invested enterprises registered in the pilot areas that intend to participate in the above mentioned pilot scheme can submit applications online through the e-government service platform of the Ministry of Industry and Information Technology. Enterprises that satisfy the requirements will be granted an approval on the pilot operation of value-added telecom services by the Ministry of Industry and Information Technology.
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