China Law Bulletin - November 2004

The State Council issued the Decision on Reform of Investment System (the "Decision" hereinafter) on July 25, 2004. The core of the reform is to reduce the government’s direct intervention in enterprises’ activities, enable the market to better distribute resources, optimize investment structure, raise investment efficiency, and promote the sustained, fast, coordinated, and healthy development of the national economy and all-round social progress.

Key features of the Decision are as follows:

1. Approval procedures streamlined

The Decision changes investment approval into three forms, "Approval" (shen-pi), "Authorization" or confirmation (he-zhun), and "Filing" or registration (bei-an).