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Security Industry Permitted to Accept Foreign Investment
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In 2007 foreign investment will be permitted in China's security services industry which meets a commitment to the World Trade Organization (WTO), said a senior official yesterday.

The industry, currently solely funded and operated by public security departments, will be open to private investors from home and abroad, said Ma Weiya, deputy director of the public order regulation department under the Ministry of Public Security.

"The opening is essential to a rapidly growing industry and also meets our WTO commitment," he said during yesterday's first Beijing International Security Forum. .

The security service industry includes bodyguards, transportation protection, residential and office security and electronic equipment. 

Ma explained that China's first regulation on the security service industry, likely to be issued in the first half of next year, would spell out specific requirements for private investors. 

"In principle foreign investors will be allowed to set up joint-venture security companies in China," Ma said. "But certain areas such as armed escort services will remain closed." He said no country would unconditionally open this specialist field as it was closely related to state and social security.

Ministry figures show that since the opening of China's first security service company in 1984 in Shenzhen, Guangdong Province, the country now has approximately 2,300 companies with 1.3 million staff.

Ma said the regulation would change the existing policy where only public security departments were allowed to open security service companies and make it more market-oriented.

"In the initial stages of the industry it was necessary to have a centralized management authority," he said. "But now it's time to open the market and turn public security departments from operators to regulators."

The regulation will spell out specific criteria for grading security companies and staff. Credit records will also be set up for those involved. 

Mo Jihong, a researcher with the National Institute of Law under the Chinese Academy of Social Sciences, said the policy change would be beneficial to ensuring a healthy market. "Without monopolization the market will become more competitive and customers are likely to enjoy better services," he said.

The 2008 Beijing Olympic Games and 2010 Shanghai Expo are considered as two prime opportunities for the rapidly expanding industry.

Gao Yu, deputy director of the Beijing Public Security Bureau, said at the forum that security staff would be an essential addition to police in protecting the Olympic Games. They'd be responsible for safeguarding sports venues, maintaining public order and checking credentials during the event.

A special training program has been launched for 740,000 security staff in Beijing to improve their professional skills and knowledge before the Games.

(China Daily September 21, 2006)

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