China's State Council, the country's Cabinet, has approved a regulation revision to relax restrictions on the establishment of foreign-funded telecommunications companies.
According to the new rules, the minimum registered capital requirement for a foreign-funded telecom company that managed basic services nationwide or intra-provincially was halved to 1 billion yuan (145.9 million U.S. dollars) from the previous requirement.
Foreign-funded telecom companies running basic services at provincial-level regions were required to have a minimum registered capital of 100 million yuan, down from 200 million yuan previously.
However, the minimum registered capital requirement for companies running value-added telecom services was unchanged compared with previous rules.
The new rules also deleted the article banning the foreign listing of domestic telecom enterprises without approval from industry supervisors.
The revised rules, with immediate effect, aimed to boost the development of the telecom sector and its opening up to the outside.
The proportion of foreign investments should not surpass 49 percent of the total investment in a company for basic services, which could not be over 50 percent for operators doing value-added services.
The Administration of Foreign-funded Telecommunications Enterprises Provisions came into effect in 2002.
The domestic telecom industry has boomed in recent years due to the rapid economic growth and large population base. Industry revenue reached 72.8 billion yuan in 2007, up 10.9 percent year-on-year.
(Xinhua News Agency September 13, 2008)