China Imposes New Rules on on Foreign Advertising Investment

03 October 2008

BEIJING: China's State Administration for Industry and Commerce this week updated regulations aimed at controlling overseas investment in Chinese advertising businesses.

Although not in themselves unduly onerous, the new rules should prove handy to the commissars in corralling any foreign upstarts who fail to toe the party line. 

Among the key issues covered by the new rules …

  • Only after receiving official approval can foreign-invested advertising enterprises engage in design, production, publication and some other types of advertising businesses, both for domestic and overseas costumers.
  • A Sino/foreign advertising joint venture can be established only if all investing parties are the enterprises engaging in advertising business and having been operating for more than two years.
  • For the establishment of a wholly foreign-owned advertising enterprise, the investor is required to be an enterprise with advertising as its main business and also has been in operation for over three years.
  • A foreign-invested advertising enterprise is qualified to apply the establishment of a branch in China, only if it has the full amount of its registered capital paid up, and with a minimal annual operating turnover of Yuan 20 million ($2.92m; €2.08m; £1,64m).
The regulations, jointly promulgated by SAIC and the Ministry of Commerce, replace the former regulations issued by those bodies in March 2004.

Data sourced from People's Daily Online / Xinhua (China); additional content by WARC staff