10 May 2017
China (Sichuan) Pilot Free Trade Zone
Officially launched on 1 April 2017, the Sichuan Pilot Free Trade Zone (FTZ) forms part of a third batch of government-endorsed pilot FTZs. All told, the zone covers an area of 119.99 sq km and consists of three sub-zones: The Chengdu Tianfu New Area (90.32 sq km inclusive of the Chengdu High-Tech Comprehensive Bonded Area 4 (Shuangliu Park) (4 sq km) and the Chengdu Airport Bonded Logistics Centre (Type B) (0.09 sq km)), the Chengdu Qingbaijiang Railway Port Area (9.68 sq km inclusive of the Chengdu Railway Bonded Logistics Centre (Type B) (0.18 sq km)), and the Chuannan Lingang Area (19.99 sq km inclusive of the Luzhou Port Bonded Logistics Centre (Type B) (0.21 sq km)).
In line with the Overall Plan for the China (Sichuan) Pilot FTZ, as approved by the State Council, over the next three to five years, a high-level, high quality free trade park will be established within the site’s perimeter. With a well-regulated, legally-compliant environment, this will drive forward a new generation of investment and trade facilitation measures. Through the clustering of a number of innovative ancillary sectors and its commitment to maintaining efficient and effective oversight, the FTZ is also expected to play a lead role in the development of an inland open economic highland, while being a key advocate for the managed evolution of both the wider western region and the Yangtze River Economic Belt.
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
The Chengdu Tianfu New Area
This site will focus on the development of a modern services sector, high-end manufacturing, cutting-edge technology, airport-related economic development and port services. It will additionally establish itself at the heart of a new cluster of high-end industries and as a pioneering centre in the fields of innovation-driven development and progressive open finance. It will also function as a commercial logistics centre and an international aviation hub, while working in partnership with the western region’s gateway cities.
The Chengdu Qingbaijiang Railway Port Area
With a focus on developing port services – including international commodity distribution/transshipment, distribution/exhibitions, bonded logistics warehousing, international forwarding, automobile imports and specialist financial instruments – this site will play a pivotal role in the establishment of the west-facing trade corridor that will link the inland regions with the Silk Road Economic Belt. It will also look to make inroads into the services sector, largely through information provision, technological support and convention/exhibition activities.
The Chuannan Lingang Area
This will focus on developing a range of high quality professional services, including shipping logistics, port trade, education and medical support. As part of its remit, it will also look to nurture the advanced manufacturing industries, as well as looking to take a lead in a number of other sectors, including equipment manufacturing, medicine and food/beverages. Furthermore, it will play a key role in the development of an integrated transport hub, which will provide streamlined connections between the Chengdu-Chongqing city cluster and Yunnan and Guizhou, its southerly neighbours.
Policy and Regulatory Updates
For the latest information on the China (Sichuan) Pilot Free Trade Zone, please consult the following websites: