10 May 2017
China (Liaoning) Pilot Free Trade Zone
Officially launched on 1 April 2017, the Liaoning Pilot Free Trade Zone (FTZ) forms part of a third batch of government-endorsed pilot FTZs. All told, it covers an area of 119.89 sq km and consists of three sub-zones: The Dalian Area (59.96 sq km inclusive of the Dalian Bonded Area (1.25 sq km), the Dalian Export Processing Area (2.95 sq km) and the Dalian Dayaowan Bonded Port (6.88 sq km)), the Shenyang Area (29.97 sq km) and the Yingkou Area (29.96 sq km).
In line with the Overall Plan for the China (Liaoning) Pilot FTZ, as approved by the State Council, over the next three to five years, the Liaoning FTZ will establish a system for institutional innovation in accordance with the best international investment and trade practices, while also nurturing a facilitative and conducive, legally-compliant, globally-minded business environment. It will also look to enhance its competiveness in terms of manpower and capital, while constructing a high-level free trade park and nurturing a cluster of high-end industries. Additionally, investment and trade facilitation are to be prioritised alongside the provision of robust financial services and effective and sustainable oversight. Overall, it will play a lead role in transforming the northeastern region’s economic growth model, while enhancing its general economic development.
Foreign Investment Management
Under the terms of the Special Administrative Measures (Negative List) Relating to Foreign Investment Access, as promulgated by the State Council, a series of special management measures covering those businesses and industries deemed unsuitable for foreign investment are to be implemented across the 11 FTZs currently operating on the mainland. In the case of any sectors not specified on the negative list, the current practice of advance approval for foreign-invested projects, as well as the established process of examining and approving any foreign-invested enterprise’s contracts and articles of association, is to be replaced by filing requirements more in line with the system specified for domestic investors.
Any special administrative measures in place relating to national security, public order, public culture, financial prudence, government procurement, subsidies, special procedures and tax-related matters remain in force even if such sectors are not specified on the negative list. Furthermore, in the case of sectors related to national security, any foreign investment is also subject to scrutiny under the terms of the Tentative Measures for the National Security Review of Foreign Investment in Free Trade Zones.
Positioning of Sub-zones
With a specialisation in port and shipping logistics, the site will also focus on finance/trade, high-tech equipment manufacturing, high and new technology, and the circular economy. Additionally, it will take a lead role in the construction of the Northeast Asia International Shipping and Logistics Centre, while providing a platform for wider co-operation across Northeast Asia.
The site will primarily focus on the advanced manufacturing sector, particularly with regard to equipment, automobiles/automotive parts and aeronautical equipment. In terms of the services sector, the emphasis will be on finance, technology and logistics. Overall, there will be a drive to establish the area as a model for contemporary industrialisation and as the technological innovation centre of northeastern China, while also developing a globally-competitive base for the manufacture of cutting-edge equipment.
Developing a high standard of professional services in the fields of commercial logistics, cross-border e-commerce and finance will be the key element of the region’s remit. Its activities will also extend to next-generation information technology and high-end equipment manufacturing. The ultimate aim is that Yingkou will serve as an international logistics facility for the wider region, while also operating as high-end equipment manufacturing and high technology industrial centre. It will also be home to an internationally-oriented multimodal sea-rail transport hub.
Policy and Regulatory Updates
For the latest information on the China (Liaoning) Pilot Free Trade Zone, please consult the following websites: