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Shanghai FTZ to relax 'negative list'

China Daily, November 5, 2013

• Officials at the China (Shanghai) Pilot Free Trade Zone have responded to criticisms of its "negative list" placing restrictions on foreign investment in the FTZ, saying that the current list of restrictions will be relaxed next year and revised on a yearly basis, according to a report in the Oriental Morning Post.

  According to the newspaper, officials said the current list is the 2013 version, but later versions, starting in 2014, will likely feature fewer restrictions.

  The negative list covers 1,069 businesses in 89 divisions within 18 main categories, identifying sectors in which investment is restricted or prohibited. It also contains 190 measures to control how business is conducted and managed.

  Since its announcement, critics have claimed the FTZ negative list is essentially a copy of the existing Foreign Investment Industrial Guidance Catalog, but with additional restrictions.

  In response, the FTZ authorities confirmed that the negative list was based on the catalog, along with national laws and regulations on foreign investment, the FTZ framework plan, and other documents approved by the State Council. The list also includes content from bilateral investment agreements with the WTO, CEPA, ECFA, etc.

  Up until Oct 29, by the time the FTZ had been officially launched for a month, a total of 29 foreign companies have been newly registered at the FTZ administrative committee, of which 24 are foreign companies registered outside the negative list.

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