Promulgation time: 2014-1-6

In order to carry out the important decision of the CPC Central Committee and the State Council to establish the China (Shanghai) Pilot Free Trade Zone ("the Pilot Zone" hereinafter), implement a more active opening-up strategy and encourage the Pilot Zone to promote development, reform and innovation through opening-up and build up experience that can be copied and spread, the following suggestions on further opening up the value-added telecoms business in the Pilot Zone to foreign investors are hereby put forwarded in accordance with the State Council Reply on Approving the Framework Plan for China (Shanghai) Pilot Free Trade Zone.
    I. Guiding thought
Strive to further open up, on a pilot basis, the value-added telecom business in the Pilot Zone to foreign investors. Strengthen administration and guide foreign-funded enterprises to carry out telecoms business in a regulated way.  Improve service, maintain a market environment of fair competition and promote sustainable and sound development of the telecom market.
II. Fields to be opened up
    1. The foreign investment ratio of information service and store-and-forward business, which have been opened up to foreign investments under China's WTO commitments but with an equity limitation of below 50%--may exceed 50% on a pilot basis. The aforesaid information service business only includes application stores.
    2. Four pilot new businesses are to be opened up: call centre, domestic multi-party communication service, Internet access service (access service for Internet users) and domestic Internet virtual private network (VPN). The foreign investment ratio of call centre, domestic multi-party communication and Internet access (access service for Internet users) may exceed 50%; while that of domestic Internet VPN may not exceed 50%.
    3. The foreign investment ratio of online data and trade processing (for-profit e-commerce) businesses may not exceed 55%.
4. To apply for conducting the aforesaid telecom businesses, an enterprise shall have its registered address and service facilities located in the Pilot Zone. The business scope of Internet access service (access service for Internet users) shall be limited within the Pilot Zone, while that of other businesses may cover the whole country.
    III. Safeguard measures
    1. Formulation of detailed rules
    According to the general arrangement of the State Council, the implementation of relevant contents of the Provisions for Administration of Foreign-Invested Telecommunications Enterprises (Decree of the State Council No. 534) is suspended in the Pilot Zone for the present. Meanwhile, administrative measures on the pilot businesses shall be formulated quickly, relevant administrative rules adjusted, approval formalities simplified and the time thereof shortened.
    2. Create environment
    Guide foreign-invested enterprises to conduct value-added telecom business according to law, and encourage the entry of R&D centers of such enterprises into the Pilot Zone. Effectively protect the legitimate rights and interests of telecom users, foster and maintain a market environment of fair competition and promote the sustainable and sound development of the telecom market.
    3. Improve service
    Step up efforts to publicize policies, build platforms for service exchange and strengthen communication with foreign-invested enterprises.  Provide policy consultation and service to foreign-invested enterprises, and actively help them solve practical difficulties and problems.
    4. Strengthen regulation
    Improve the collection and statistical analysis of relevant information, and specify requirements on network infrastructure, data resources and user information protection.  Strengthen supervision over international telecom business and network operation safety so as to protect network and information security.
    In order to further open up the business of value-added telecommunication in the Pilot Zone, the Ministry of Industry and Information Technology and Shanghai Municipal People's Government shall set up a ministry-city coordination mechanism to push forward the implementation of related tasks. Shanghai Communications Administration shall increase efforts to guide and supervise foreign-invested enterprises, and report on a regular basis to the Ministry of Industry and Information Technology and Shanghai Municipal People's Government the implementation and administration of the pilot business opening-up.