On March 22, 2017, the National Development and Reform Commission promulgated the Administrative Measures on the Approval and Recordation of Enterprise Investment Projects (the “Administrative Measures”), which came into effect on April 8, 2017. The Administrative Measures are the detailed implementation measures for the Regulation on the Approval and Recordation of Enterprise Investment Projects promulgated by the State Council in November 2016 and contain further provisions concerning the scope of approval and recordation, the application documents, the basic procedures and supervision and oversight of enterprise investment projects. The major provisions of the Administrative Measures are highlighted below.
First, the scope of the approval and recordation of investment projects and the competent authority for the task are specified.
The Administrative Measures provide that approval for enterprise investment projects is required by the state only where national security, major manufacturing capability planning on a national scale, the development of strategic resources and key public interest, while the rest are subject to administration via recordation. The specific scope of projects subject to administration via approval and the approval authority are governed by the currently effective 2016 version of the Catalogue for Investment Projects Subject to Government Approval. The projects subject to administration via recordation are governed by the territoriality principle, and provincial governments will formulate the administrative measures for projects within their administrative areas to specify the agencies for recordation and their authority.
Second, the project approval system is improved.
The Administrative Measures provide for rules on deadlines under the project review system and allow a project approval agency to adopt the substantive review documents that were prepared by other departments so as to avoid redundancy and improve efficiency. For example, if assessment is required in the project review process, the Administrative Measures contain an additional assessment deadline of no more than 30 working days. If the situation is complex, the assessment period may be extended by up to 60 working days. Where project construction may materially impact public interest, if the relevant departments have conducted substantive review and prepared the relevant approval documents addressing such concerns that directly impact the public interest such as land use, environmental impact, resettlement, social stability risks, etc., which allow the project review agency not have to repetitively solicit public opinions for relevant details.
Third, the manners and procedure for project recordation are clarified.
The Administrative Measures provide that project recordation information will be accepted, handled, supervised and serviced online via a national monitory platform (the “Online Platform”) through which one may search and monitor the recordation process and the results. The recordation details include the basic profile of the project organization, project name, construction location, scale of construction, total project investment amount and the statement that the project meets the industry policy. The formatting and text of the basic information of a recorded project are set by the project recordation agency concerned. In addition, recordation is completed when the project recordation agency receives all of the above information. In the event of any material change to the project legal person, project construction location, scale or details, or if the construction project is abandoned, the project organization is required to notify the project recordation agency through the Online Platform and on a timely basis and to amend the relevant information accordingly.
Fourth, the principle of interim and ex post supervision of projects is stressed.
The Administrative Measures confirm the principle that the “agency which grants the approval or is the competent authority shall conduct the supervision” in tandem with the Regulation on the Approval and Recordation of Enterprise Investment Projects and specify the use of online supervision, onsite inspection and other methods to enhance the interim and ex post supervision by the project approval and recordation agencies. In case of information concerning illegal acts or handling of a project organization, such information will be included in irregular credit records for the project and in the national credit information sharing platform.
In conclusion, the Administrative Measures further detail the approval and recordation systems for investment projects in China on top of the Regulation on the Approval and Recordation of Enterprise Investment Projects so that the autonomy of enterprise investment is better realized, and a unified and regulated system for the basic procedures and relevant issues concerning project approval and recordation is established. This system will greatly enhance the convenience of all kinds of fixed asset investment.