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Detailed Rules for The Implementation of The Law on Sino-Foreign
Cooperative Joint Ventures
(Approved by the State Council of the People's Republic of
China on August 7.1995 and Promulgated by the Ministry of
Foreign Trade and Economic Cooperation on September 4,1995)
TABLE OF CONTENTS
Chapter I General Provisions
Chapter II The Establishment of a Cooperative Joint Venture
Chapter III Form of Organization and Registered Capital
Chapter IV Investment and Cooperation Conditions
Chapter V Organizational Structure
Chapter VI Purchase of Materials and Marketing of Products
Chapter VII Distribution of Income and Recovery of Investment
Chapter VIII Duration and Dissolution
Chapter IX Special Provisions on Cooperative Joint Ventures
without Legal Person Status
Chapter X Supplementary Provisions
CHAPTER I
General Provisions
Article 1
These Detailed Rules are formulated in accordance with the
Law of the People's Republic of China on Chinese-Foreign Cooperative
Joint Ventures.
Article 2
The establishment of Chinese-Foreign cooperative joint ventures
(hereinafter referred to as ~cooperative joint ventures")
in the territory of China shall comply with the development
policy and industrial policy of the State, and the provisions
of the State for the guidance of foreign investment direction.
Article 3
A cooperative joint venture may, within the perimeters of
the approved cooperative joint venture agreement. contract
and articles of association, conduct business and management
activities independently according to law and free from the
intervention of any organization or individual.
Article 4
A cooperative joint venture may be either a joint venture
with the status of a Chinese legal person obtained according
to law or one without the legal person status.
For a cooperative joint venture without the legal person
status, where Chapter IX of the Detailed Rules has special
provisions, these provisions shall apply.
Article 5
The competent authority for a cooperative joint venture shall
be the competent authority for the Chinese party of the joint
venture. Where there are more than one Chinese party to the
cooperative joint venture, the examination and approval authority
shall decide on a competent authority for the cooperative
joint venture in consultation with relevant departments, unless
otherwise stipulated in laws and administrative rules.
The competent authority for a cooperative joint venture shall
conduct coordination and afford assistance in relation to
matters of the cooperative joint venture.
CHAPTER II
The Establishment of a Cooperative Joint Venture
Article 6
The establishment of a cooperative joint venture shall be
examined and approved by the Ministry of Foreign Trade and
Economic Cooperation or the department and local people's
government authorized by the State Council.
The department or local people's government authorized by
the State Council may examine and approve cooperative joint
ventures in the following circumstances:
(1) the total amount of investment is within the authorization
for approval as set by the State Council, by the departments
or local people's governments authorized by the State Council
(2) the capital has been raised by the applicants themselves,
construction and production conditions do not need to be balanced
by the State
(3) exportation of the products of the cooperative joint venture
does not require export quota and license to be issued by
relevant competent departments of the State.' or if exportation
requires quota and license, the consent of relevant competent
departments has been obtained prior to submitting the application
for establishing the cooperative joint venture
(4) other circumstances in which the departments or local
governments authorized by the State Council may examine and
approve cooperative joint ventures as stipulated in laws and
administrative rules
Article 7
To establish a cooperative joint venture, the Chinese party/parties
(hereinafter referred to as the Chinese party) shall submit
to the exanimation and approval authority the following documents:
(1) application for establishing a cooperative joint venture
accompanied by the examination and approval documents of the
competent authority
(2) feasibility study report jointly prepared by all parties
to the cooperative joint venture accompanied by the examination
and approval documents of the competent authority
(3) joint venture agreement, contract and articles of association
signed by the legal representatives or representatives authorized
by them of all parties to the joint venture
(4) business licenses or registration certificates, financial
credit documents and valid certification documents of the
legal representatives of all parties to the joint venture,
where the foreign party/parties (hereinafter referred to as
the foreign party) is a natural person, valid certification
documents on his/her identity, resume and financial credit
shall be presented
(5) list of chairman, deputy chairmen and members of the board
of directors or list of director, deputy directors and members
of the joint management committee of the cooperative joint
venture as determined by all parties through consultation
(6) other documents as required by the examination and approval
authority
The documents listed in the preceding paragraph shall be
written in Chinese with the exception of the documents in
the subparagraph (4) to be presented by the foreign party,
each of the documents required under subparagraph (2), (3)
and (5) may be accompanied by a version of a foreign language
agreed upon by all parties.
The examination and approval authority snail decide whether
to approve or disapprove the application for the establishment
of a cooperative joint venture within 45 days from the date
of receiving all the documents as stipulated: should anything
incomplete or inappropriate be found in the documents presented,
the examination and approval authority may demand a supplement
or amendment to them within a limited period of time
Article 8
For a cooperative joint venture approved by the Ministry of
Foreign Trade and Economic Cooperation or by departments authorized
by the State Council, the certificate of approval shall be
granted by the Ministry of Foreign Trade and Economic Cooperation.
For a cooperative joint venture approved by local people's
government authorized by the State Council, the relevant local
people's government shall grant the certificate of approval
and submit the relevant approval documents to the Ministry
of Foreign Trade and Economic Cooperation for recordation
within 30 days from the date of approval.
The cooperative joint venture approved for establishment
shall apply, according to law, to the administrative authorities
for industry and commerce for registration and business license.
Article 9
An application for establishing a cooperative joint venture
shall not be approved if the venture involves in any of the
following circumstances:
(1) detriment to China's sovereignty or public interest
(2) jeopardizing the State security
(3) polluting and damaging the environment
(4) other circumstance involving violation of laws, administrative
rules and the State industrial policies
Article 10
For the purpose of the Detailed Rules, the cooperative joint
venture agreement refers to a written document produced after
all parties reached consensus on the principles and significant
matters in relation to the establishment of the cooperative
joint venture.
For the purpose of the Detailed Rules, the cooperative joint
venture contract refers to a written document produced after
all parties reached consensus on their respective rights and
obligations in the cooperative joint venture.
For the purpose of the Detailed Rules, the articles of association
of a cooperative joint venture refers to a written document
laying down the principles of organization and method of operation
and management as agreed on by all parties in line with the
cooperative joint venture contract.
Where there are any contents n the agreement and articles
of association, which are inconsistent with the contract of
a cooperative joint venture, the contract shall prevail.
The parties to a cooperative joint venture may not sign a
cooperative joint venture agreement.
Article 11
The agreement, contract and articles of association of a cooperative
joint venture shall enter into force upon the issuance of
the certificate of approval by the examination and approval
authority. For the duration of the cooperative joint venture,
and substantive amendment to the agreement, contract and article
of association of the cooperative joint venture shall be approved
by the examination and approval authority.
Article 12
The contract of a cooperative joint venture shall bear the
following items:
(1) names, place of registration, domicile of all parties,
and names, titles and nationalities of their legal representatives
(where the foreign party is a natural person, his/her name,
nationality and domicile)
(2) name, address and business scope of the cooperative joint
venture
(3) total amount of investment, registered capital, way and
duration of investment or cooperation conditions contributed
by each party
(4) transfer of investment contribution or provision of cooperation
conditions by each party
(5) distribution of income or products to all parties, apportioning
of risk or loss between the parties
(6) composition of the board of directors or the joint management
committee, allocation of the members of the board of directors
or the joint management committee. responsibilities of and
the ways for employment and dismissal of the president and
other senior management people
(7) main production equipment and production technology to
be employed, and their sources
(8) arrangement for sales of products in and outside China
(9) arrangement for the income and expenditure of foreign
exchanges of the cooperative joint venture
(10) duration, dissolution and liquidation of the cooperative
joint venture
(11)other obligations of the parties and the responsibilities
arising from breach of the contract
(12)principles for handling finance, accounting and auditing
(13)settlement between and among all parties
(14)procedures for amending the cooperative joint venture
contract
Article 13
The articles of association of a cooperative joint venture
shall include the following items:
(1) name and address of the cooperative joint venture
(2) business scope and duration of cooperation of the cooperative
joint venture
(3) names, places of registration, domicile of all panties
to the cooperative joint venture and names, titles, and nationalities
of their legal representatives (where the foreign party is
a natural person, his/her name, nationality and domicile)
(4) total amount of investment, registered capital, ways and
duration of investment or cooperation conditions contributed
by the parties to the cooperative joint venture
(5) distribution of income or products to all parties and
apportioning of risk and loss between the parties
(6) composition, terms of reference and proceedings of the
board of directors or joint management committee of the cooperative
joint venture; term of office for directors of the board of
directors or members on the joint management committee; terms
of reference of chairman and vice chairmen of the board of
directors or director and deputy directors of the joint management
committee
(7) establishment, terms of reference and rules for handling
matters of the operation and management body; terms of reference,
engagement and dismissal of general manager and other senior
management personnel
(8) regulations related to labor management covering employment
of staff and workers, training, labor contract, salaries &
wages, social insurance, welfare benefits, job safety, etc.
(9) finance, accounting and auditing system of the cooperative
joint venture
(10)dissolution and liquidation of the cooperation joint venture
(11)procedures for amendment of the articles of association
of the cooperative joint venture
CHAPTER III
Form of Organization and Registered Capital
Article 14
The cooperative joint venture, after obtaining the status
of Chinese legal person, shall take the form of a limited
liability company. Unless otherwise stipulated in the cooperative
joint venture contract. each party shall be held liable to
the cooperative joint venture within the limit of its investment
and cooperation conditions contributed to the cooperative
joint venture.
The cooperative joint venture shall be held liable to its
debts within the limit of its total assets.
Article 15
The total amount of investment of a cooperative joint venture
refers to the sum of funds necessary for reaching the production
scale provided for by the cooperative joint venture contract
and the articles of association of the cooperative joint venture.
Article 16
The registered capital of a cooperative joint venture refers
to the total amount of capital. contributed by all parties
to the cooperative joint venture and registered with the authority
for industry and commerce when applying for the establishment
of the cooperative joint venture. Registered capital can be
either denominated in Renminbi Yuan or in any other freely
convertible foreign currency as agreed upon by all parties
to the cooperative joint venture.
Any decrease in the registered capital of the cooperative
joint venture is not allowed during the term of cooperation.
However, any decrease. necessary due to changes in the total
amount of investment and production scale, shall be subject
to the approval of the examination and approval authority
CHAPTER IV
Investment and Cooperation Conditions
Article 17
All parties to cooperative joint venture shall, in accordance
with the provisions of relevant laws and administrative regulations
and stipulations of the cooperative joint venture contract,
make their investment or provide cooperation conditions to
the cooperative joint venture.
Article 18
The investment made or cooperation conditions provided by
all parties to the cooperative joint venture may be in cash,
in kind, or in other property rights such as industrial property
rights, know-how and land-use rights.
Where the investment or cooperation conditions provided by
the Chinese party fall into the category of State assets,
an asset evaluation shall be conducted in accordance with
relevant provisions of laws and administrative regulations.
For a cooperative joint venture, which has obtained the status
of a Chinese legal person according to law, the investment
made by the foreign party shall be, in general, no less that
25% of the registered capital of the venture. For a cooperative
joint venture without the status of a legal person, the specific
requirements for the investment made and cooperation conditions
contributed by all parties to the venture shall be subject
to the regulations stipulated by the Ministry of Foreign Trade
& Economic Cooperation.
Article 19
The investment made or cooperation conditions provided shall
be the property or property rights owned by the parties to
a cooperative joint venture. The investment made or cooperation
conditions provided shall not be property or property rights
already posted as mortgage or other forms of collateral.
Article 20
All parties to a cooperative joint venture shall stipulate,
based on the production and operation requirements of the
venture and in light of the provisions of relevant laws and
administrative regulations, the duration of the investment
to be made and the cooperation conditions to be contributed
in the joint venture contract.
In the event of a failure to make the investment or provide
the cooperative conditions as set forth by the cooperative
joint venture contract. the authority for the administration
of industry & commerce shall specify a time limit for
performance. If the said obligations are Still not performed
upon the expiration of the specified time limit, the examination
and approval authority shall revoke the certificate of approval
and the authority for the administration of industry and commerce
shall revoke the business license of the cooperative joint
venture and make a public announcement to that effect.
Article 21
The party failing to make investment or provide cooperation
conditions as set forth by the cooperative joint venture contract
shall be held liable for the breach of contract to the other
party which have performed their duties as stipulated in the
contract.
Article 22
The investments made or cooperation conditions contributed
by all parties to the cooperative joint venture shall be verified
by, and reports of verification shall be submitted by accountants
registered n China. And certificates of contribution shall
be issued thereupon to all parties by the cooperative joint
venture. The certificate of contribution shall include the
following items:
(1)name of the cooperative join venture
(2)date of the establishment of the cooperative joint venture
(3)names of all parties to the cooperative joint venture
(4)contents of the investments made or the cooperation conditions
contributed by all parties to the cooperative joint venture
(5)date of contribution of investments or provision of operation
conditions by all parties to a cooperative joint venture
(6)serial No. and date of issuance of the certificate of contribution
Copies of the certificate of contribution shall be submitted
respectively to the examination and approval authority and
the authority for the administration of industry and commerce.
Article 23
Mutual transfer of all or part of its rights under the cooperative
joint venture contract between parties to the venture or transfer
of all or part of its rights under the contract from one party
to a third party other than the parties to the venture shall
be subject to the consent in written form from the other party,
and the matter shall be submitted to the examination and approval
authority for approval.
The examination and approval authority shall decide to approve
or disapprove the assignment within 30 days of receipt of
the relevant documents.
CHAPTER V
Organizational Structure
Article 24
A board of directors or a joint management committee shall
be established in a cooperative joint venture. The board of
directors or the joint management committee shall be the power
organ of the cooperative joint venture, and shall, in accordance
with the provisions of the articles of association of the
cooperative joint venture, decide on major important issues
concerning the cooperative joint venture.
Article 25
The board of directors or the joint management committee shall
consist of at least three persons. The allocation of members
shall, through consultations between the Chinese party and
the foreign party, be decided with reference to the proportion
of the investments or cooperation conditions contributed by
each party.
Article 26
Directors of the board of directors or members on the joint
management committee shall be appointed or replaced by all
parties themselves. The selection of chairman and vice chairmen
of the board of directors or director and, deputy directors
of the joint management committee shall be provided for in
the articles of association of the cooperative joint venture.
Where the position of chairman of the board of directors or
director of the joint management committee is assumed by a
nominee of the Chinese party or the foreign party, the position/positions
of vice chairman/chairmen or deputy director/directors shall
be assumed by a nominee of the other party.
Article 27
The tenure of directors and members on the joint management
committee shall be decided by articles of association of the
cooperative joint venture, with each tenure no longer that
three years. Upon expiration of each tenure, directors and
members may renew their tenure if reappointed by the appointing
party.
Article 28
Directors of the board or members on the joint management
committee shall meet at least once a year, with the meeting
convened and presided over by the chairman of the board or
director of the committee. Where the chairman of the board
or the director of the committee is unable to perform his/her
duties out of Special reasons, he/she may appoint a vice chairman
of the board, deputy director of the committee, other directors
or members to convene and preside over such meetings Meetings
of the board or committee may be convened on proposals made
by more that one third of the total number of directors or
members. Meetings of the board or committee can only be convened
with the presence of more than two thirds of directors or
members. Directors or members unable to participate in such
meetings shall entrust, in written form others to participate
in such meetings and lodge votes on their behalf. Decisions
made at the board or the committee meetings shall be adopted
with the consents of more than half of the directors or members.
Directors or members who neither participate in the said meetings
nor entrust others to participate in the said meetings on
their behalf without any reasonable excuse shall be regarded
as having participated in the meetings of the board or the
committee and having
lodged abstention votes
All directors or members shall be notified of the board or
the committee meetings 10 days prior to their convocation.
Decisions may also be made by the board or the committee
through correspondence.
Article 29
Decisions concerning the following items can only be adopted
with the unanimous consent of all the directors or members
participating in the meetings of the board or the committee
(1) amendment to the articles of association of the cooperative
joint venture
(2) increase or reduction of the registered capital of the
cooperative joint venture
(3) dissolution of the cooperative joint venture
(4) mortgage of the assets of the cooperative joint venture
(5) merge and split of the cooperative joint venture and change
in the form of the organization
(6) other matters which may only be decided with unanimous
consent at the meetings of the board or the committee as previously
agreed upon by parties to the joint venture
Article 30
Decision making process and voting procedures of the board
of directors and the Joint management committee, other than
those being stipulated in these Detailed Rules, shall be provided
for in the articles of association of the cooperative joint
venture
Article 31
The chairman of the board or the director of the committee
is the legal' person of the cooperative joint venture. Where
the chairman of the board or the director of the committee
is unable to perform his duty out of special reasons, vice
chairman of the board, deputy director of the committee, other
directors or members shall be authorized to represent the
cooperative joint venture in its external relations.
Article 32
A cooperative joint venture shall have one general manager
who will be responsible for the routine operation and man2gement
of the joint venture and accountable to the board of directors
or the joint management committee.
The general manager of a cooperative joint venture shall
he engaged or dismissed by the board of directors or the joint
management committee.
Article 33
Posts of the general manager and other senior managers may
be assumed by Chinese or foreign citizens.
Directors of members may assume concurrently the posts of
the general manager or other senior manages of the cooperative
joint venture, as engaged by the board of directors or the
joint management committee.
Article 34
The general manager or other senior managers who are incompetent
or found to have actions of malpractice or serious negligence
of duty may be dismissed as decided by the board of directors
or the joint management committee, and those who cause losses
to the cooperative joint venture shall be held responsible
in accordance with relevant laws and regulations.
Article 35
Where a party other than the parties to a cooperative joint
venture is entrusted with the business operation and management
of the venture after its establishment, unanimous consent
of the board of directors or the joint management committee
shall be obtained and a contract of trusteeship for operation
and management shall be entered into with the trustee.
The cooperative joint venture shall submit documents such
as the resolution of the board of directors or the joint management
committee, the contract of trusteeship that has been signed
and the financial credit documents of the trustee, etc. to
the examination and approval authority for approval. The examination
and approval authority shall thereupon decide to approve or
disapprove within 30 days upon receipt of the said documents.
CHAPTER VI
Purchase of Materials and Marketing of Products
Article 36
The cooperative joint venture shall work out production and
operation plans on its own, oased on the approved business
scope and scale of production and operation.
Governmental organizations shall not a force cooperative
joint venture to carry out production and operation plans
formulated by governmental organizations.
Article 37
A cooperative joint venture may decide, on its own, to purchase
either within the territory of China or from foreign countries
machines and equipment, raw materials, fuels, parts and components.
accessories, transportation tools and office articles, etc.
(hereinafter referred to as "materials").
Article 38
The State encourages cooperative joint ventures to sell their
products on international markets. These ventures may directly
sell their products on international markets or entrust overseas
distributors or Chinese Foreign trade companies to sell their
products by proxy or on commission.
Prices of the products sold by the cooperative joint venture
shall be decided by the venture itself according to law.
Article 39
Machines and equipment, parts and components as well as other
materials imported by the foreign party as investment in kind
and machines and equipment, parts and components and other
materials needed in production and operation, which are imported
by the cooperative joint venture with funds, of the total
investment are exempt from import tariffs and turnover tax
in the import links. When the above-mentioned imported materials
which are exempt from tariffs and tax are resold within the
territory of China or put into domestic commercial channel
upon approval, tariffs and tax or overdue tariffs or tax shall
be paid in accordance with relevant laws and regulations.
Article 40
A cooperative joint venture shall not export products at prices
ostensibly lower than reasonable prices of products of the
like on international markets or import materials at prices
higher than those of products of the like on the international
markets.
Article 41
Products of a cooperative joint venture shall be sold in compliance
with the provisions of the approved contract of the venture.
Article 42
The cooperative joint venture shall apply, in accordance with
relevant State regulations, for import or export licenses
and quotas for products subject to licensing and quota administration,
which they intend to import or export.
CHAPTER VII
Distribution of Income and Recovery of Investment
Article 43
Chinese and Foreign parties to a cooperative joint venture
may distribute income through profit-sharing or other forms
as agreed upon by both parties.
Tax payable shall be calculated according to relevant provisions
of the tax law when product-sharing or other forms are adopted
in income distribution.
Article 44
On the expiration of the Cooperation as defined in the Contracts
of the cooperative joint ventures by Chinese and foreign parties,
In the fixed assets of the ventures shall belong to the Chinese
party on a gratuitous basis and the Foreign party may apply,
within the term of the cooperation, for an early recovery
of their investment in the following ways:
(1) on the basis of distribution according to the contribution
of investment or cooperation conditions, agreement shall be
reached in the contract of the cooperative joint venture to
increase the proportion of profit sharing to the foreign party
(2) upon examination and approval by the finance and taxation
authorities according to State provisions on taxation, the
foreign party may first recover its investment before income
tax payment is made by the cooperative joint venture
(3) other means of investment recovery approved by the finance
and taxation authorities as well as the examination and approval
authority. For a cooperative joint venture that allows the
Foreign party to first recover the investment, as defined
in the preceding paragraph, the Chinese and Foreign parties
shall share the liabilities of the cooperative joint venture
in light of relevant legal provisions and agreements in the
joint venture contract
Article 45
When the foreign party of the venture applies for an early
recovery of investment according to Article 44 (1) and (2),
the party shall specifically explain the amount of the investment
and the time and ways it would like to first recover such
investment. Upon approval by the finance and taxation authorities
after examination, such application shall be submitted to
the examination and approval authority for final review and
approval.
The Foreign party shall not be allowed to recover its investment
unless the loss of the cooperative joint venture is recovered.
Article 46
A cooperative joint venture shall entrust, according to relevant
State provisions, accountants registered in China to check
and verify the account-books. Parties to the cooperative joint
venture may either jointly or separately entrust accountants
registered in China to check the account-books, and costs
incurred therefrom shall be born by the party (or parties)
that entrust the accountants.
CHAPTER VIII
Duration and Dissolution
Article 47
The duration of a cooperative joint venture shall be decided
upon by all parties to the joint venture through consultation
and shall be stipulated in the joint venture contract.
If extension of the term of cooperation is agreed upon by
all parties upon expiration of the duration of the cooperative
joint venture, an application shall be submitted 180 days
before the expiration to the examination and approval authority,
with due explanations on the execution of the contract establishing
the cooperative joint venture, reason for the extension, and
agreement on rights and obligations and other matters of each
party in the extended period. The examination and approval
authority shall decide to approve or disapprove within 30
days upon receipt of the extension application.
Upon approval of the extension of duration, the cooperative
joint venture shall go through formalities for the alteration
of registration with the administrative authority for industry
and commerce, and the extended duration shall start from the
first day after the expiration of the original term of cooperation.
The duration for a cooperative joint venture shall not be
extended if the joint venture contract has allowed the foreign
party to first recover its investment and such investment
has been fully recovered. However, when the Foreign party
of a cooperative joint venture agrees to increase the investment
and when all parties reach consensus after consultation, an
application for extension of the term of cooperation may be
filed with the examination and approval authority in light
of paragraph II of this Article.
Article 48
A cooperative joint venture shall be dissolved in one of the
following situations:
(1) termination of duration
(2) inability to continue operations due to have financial
losses of the cooperative joint venture or heavy losses caused
by force majeure
(3) inability to continue operations due to the failure of
one or several parties to fulfill the obligations as stipulated
in the contract and articles of association
(4) occurrence of other reasons for dissolution stipulated
in the contract and articles of association
(5) revocation made by authorities according to law due to
violation of laws and administrative regulations
In cases described in (2) and (4) of this Article, the board
of directors or joint management committee of a cooperative
joint venture shall make the decision and submit it to the
examination and approval authority for approval. In case of
(3) of this Article, the party or parties failing to fulfill
obligations as stipulated in the contract and articles of
association shall be held liable to losses thus occurred to
party or parties fulfilling the stipulated obligations. The
party or parties that have fulfilled their obligations have
the rights to apply to examination and approval authority
for the dissolution of the cooperative joint venture
Article 49
The liquidation procedures of a cooperative joint venture
shall be handled according to relevant Chinese laws, administrative
regulations and stipulations in the joint venture contract
and articles of association
CHAPTER IX
Special Provisions on Cooperative Joint Ventures without Legal
Person Status
Article 50
A cooperative joint venture without legal person status and
all parties to the venture snail be held responsible for civil
liabilities according to relevant provisions in Chinese civil
laws
Article 51
A cooperative joint venture without legal person status shall
register the investment made or cooperation conditions provided
by each party at the administrative authority for industry
and commerce
Article 52
The investment made or cooperation conditions provided by
each party to a cooperative joint venture without legal person
status shall belong to the contributing party Depending on
agreements reached by all parties. such investment or cooperation
conditions may be jointly owned by all parties, or partly
owned by each contributing party and partly owned by all parties
Assets accumulated from operations of the cooperative joint
venture shall belong to all parties
Investment made or cooperation conditions provided by parties
to a cooperative joint venture without legal person status
shall be subject to unified management and utilization by
the cooperative venture No party shall take the liberty to
take actions on such matters without the consent from other
parties
Article 53
A cooperative joint venture without legal person status shall
establish a joint management committee, which shall consist
of representatives of all parties to the cooperative joint
venture and shall manage the cooperative joint venture on
behalf of all parties
The joint management committee shall decide on all major
issues concerning the cooperative joint venture
Article 54
A cooperative joint venture without legal person status shall
establish unified account books on the location of the joint
venture, and each party to the joint venture shall establish
its own account books
CHAPTER X
Supplementary Provisions
Article 55
Chinese laws shall be applied in the conclusion, effectiveness,
interpretation, execution of the contract and settlement of
disputes of a cooperative joint venture.
Article 56
Provisions in other relevant laws and administrative regulations
shall apply to matters other than those provided for in the
Detailed Rules, including financial affairs, accounting and
auditing foreign exchange, taxation, labor management and
trade union etc. concerning a cooperative joint venture
Article 57
Where a cooperative joint venture is established by a company,
enterprise, other economic organization or individuals in
Hong Kong, Macao and Taiwan region and Chinese citizens inhabited
abroad it shall be handled with reference to these Detailed
Rules
Article 58
These Detailed Rules shall enter into force as of the date
of promulgation.
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