Article 10 An equity joint venture, within its approved scope of operations and in accordance with the principles of fairness and reasonableness, may purchase raw ' materials, fuels, and other such materials from both domestic and international markets.
An equity joint venture shall be encouraged to sell its products outside China . It may sell its export products on foreign markets through its own direct channels or its associated agencies or through China 's foreign trade establishments. Its products may also be sold on the domestic Chinese market.
If deemed necessary, an equity joint venture may establish branch organizations outside China .
Article 11 Net profit received by a foreign partner after executing obligations prescribed by the relevant laws, agreements and contracts, funds received on the termination or suspension of an equity joint venture's operations and other relevant funds may be remitted abroad in accordance with the exchange control regulations and in the currency specified in the equity joint venture contract.
A foreign partner shall be encouraged to deposit in the Bank of China foreign exchange that is entitled to remit abroad.
Article 12 Wage income and. other legitimate income earned by equity joint venture employees of foreign nationality may be remitted abroad in accordance with the exchange control regulations after payment of individual income tax pursuant to tax laws of the People's Republic of China.
Article 13 The duration of an equity joint venture's term of operations may differ, depending on the line of business and other differing circumstances. The term of operations of some types of equity joint ventures shall be set, while the term of operations of other types of equity joint ventures may be set in some cases. But not set in others. In the case of an equity joint venture which has its term of operations set, the term may be extended subject to the agreement of all equity joint venture partners and the lodging of an application with the examining and approval authority six months before the expiry of the joint venture term. The examining and approval authority shall decide whether to approve or reject an application within one month of its receipt.
Article 14 In the event of an equity joint venture incurring heavy losses, one party failing to execute its obligations as prescribed in the equity joint venture contract or article 5 of association, or force majeure, etc. the contract may be terminated subject to the negotiation and agreement reached by all parties of an equity joint venture, the approval of examining and approval authority and registration with a state administration for industry and commerce. If a loss is incurred due to a breach of contract, the party that violated the contract provisions shall bear the financial liability for the loss.
Article 15 Any dispute arising between equity joint venture partners that the board of directors is unable to settle through consultation may be resolved through conciliation or arbitration by a Chinese arbitral body or through arbitration conducted by an arbitral body agreed on by all parties of an equity joint venture.
If the parties of an equity joint venture have not stipulated an arbitration clause in their contract or do not reach a written arbitration agreement after a dispute has arisen. They may file a lawsuit in a people's court.
Article 16 This Law shall take effect from the date of promulgation. |
