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	THE OPINIONS OF THE MINISTRY OF COMMERCE AND OTHER DEPARTMENTS ON REFORMING THE MANAGEMENT MODEL OF THE "WINDOW COMPANIES" ESTABLISHED IN HONG KONG AND MACAO

	(Notice of the General Office of the State Council about Distributing the Opinions of the Ministry of Commerce and other Departments on Reforming the Management Model of the "Window Companies" Established by the Mainland in Hong Kong and Macao (No. 90 (2003) issued by the General Office of the State Council), November 10, 2003: The Opinions of the Ministry of Commerce, the Office for Hong Kong and Macao Affairs, the Liaison Office of the Central Government in Hong Kong, the Liaison Office of the Central Government in Macao on Reforming the Management Model of the "Window Companies" Established by the Mainland in Hong Kong and Macao have won the consent of the leaders of Central Committee of the CPC and the State Council)


SUBJECT : WINDOW COMPANIES; SET UP IN HKSAR/MSAR
ISSUING DEPARTMENT : THE GENERAL OFFICE OF THE STATE COUNCIL OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 11/10/2003
IMPLEMENT DATE : 11/10/2003
LENGTH : 665 words
TEXT :

A "window company" refers to an economic entity directly invested, established and registered in Hong Kong and Macao by the people's government of a province, autonomous region, municipality directly under the Central Government or a Central Government department of the Mainland, which is authorized to exercise the administrative management functions over the enterprises established in Hong Kong or Macao by the said region, department or industry. In order to adapt to the new situation after resuming the exercise of sovereignty over Hong Kong and Macao and to accelerate the perfection of the economic system of socialist market, the Central Government departments have already separated from the "window companies" established by them. You are hereby notified of the following opinions on the management model for the "window companies" established in Hong Kong and Macao by the people's governments of all province, autonomous regions and municipalities directly under the Central Government:

1. You shall stop implementing the Notice of the General Office of the State Council about Distributing the Measures of the Hong Kong and Macao Affairs Office of the State Council for the Unified Management of the Chinese-funded Institutions Established in Hong Kong and Macao (No 61(1991) issued by the General Office of the State Council), cancel the name of "window company". From now on, the Mainland governments and departments shall not directly invest in the establishment of any Chinese-funded enterprise in Hong Kong or Macao.

2. The people's governments of all provinces, autonomous regions and municipalities directly under the Central Government shall, according to the requirements for establishing a modern enterprise system, reform the former "window companies", and shall separate from them as soon as possible. You shall take specific reform measures on the basis of the different operating status of the former "window companies", among which, those may continue to operate shall be provided a Mainland investment entity and shall be required to set up the internal mechanisms of legal person governance structure, financial affairs, human resources, investment decision making and distribution of profits that meet the demands of the market economy; the others that are unable to continue to operate shall be cancelled in accordance with the local law and the relevant regulations of the Mainland, for which all matters arising thereafter shall be properly tackled.

3. No former "window company" may exercise the functions of administrative management and supervisory inspection on behalf of the people's government of a province, autonomous region, or municipality directly under the Central Government over the enterprises established in Hong Kong or Macao by this region. The corresponding functions shall be undertaken by the Mainland investment entities of these Chinese-funded enterprises established in Hong Kong and Macao according to their relationship between ownership and management of enterprises.

4. The functions undertaken by a former "window company", such as organizing the Chinese-funded enterprises established in Hong Kong or Macao by a province, autonomous region or municipality directly under the Central Government, shall be undertaken by the important contact enterprise determined by the Liaison Office of the Central Government in Hong Kong or Macao in consultation with the Mainland government and the pertinent enterprises.

5. The main persons-in-charge of in a former "window company" shall be appointed by the Mainland investment entity according to the corresponding human resource management functions, which shall send a written notice to Liaison Office of the Central Government in Hong Kong or Macao.

6. The Liaison Office of the Central Government in Hong Kong and the Liaison Office of the Central Government in Macao shall, according to the principle of providing political leadership, policy guides and supervisory help to the Chinese-funded enterprises established in Hong Kong and Macao, strengthen the guides to the reform work of the former "window companies" while taking into consideration the actual circumstances of Hong Kong and Macao.

7. The people's governments of all provinces, autonomous regions and municipalities directly under the Central Government shall, in principle, complete the separation with their respective window company before the end of June, 2004.