Issued By the Ministry of Health and the Ministry of Foreign Trade and Economic Cooperation on May 15, 2000
Chapter 1 General Provisions
Article 1 In order to further meet the needs of China's reform and open-door policy, and to enhance the management of Sino-foreign joint equity or cooperative medical institutions, as well as to promote the healthy development of medical and healthcare services in our country, the "Measures" are enacted based on such relevant laws and regulations as the "Law of the People's Republic of China on Sino-foreign Equity Joint Ventures", the "Law of the People's Republic of China on Chinese-foreign Contractual Joint Ventures", and "Regulations on the Administration of Medical Institutions".
Article 2 The Sino-foreign joint equity or cooperative medical institutions designated in the "Measures" refer to medical institutions established within the territory of China by foreign medical institutions, corporations, enterprises, or other economic organizations(hereunder referred to as "foreign party") together with other Chinese medical institutions, corporations, enterprises, or other economic organizitions (hereunder referred to as "Chinese party") in the forms of joint equity or cooperative institutions, under the principle of equality and mutual benefit, and with the approval of the competent departments of the Chinese government.
Article 3 The "Measures" are applicable to the application for establishing Sino-foreign joint equity or cooperative medical institutions in China.
Artiale 4 Sino-foreign joint equity or cooperative medical institutions shall comply with the relevant laws, rules, and regulations of China.The rightful business operations of these institutions and the lawful rights and interestes of both parties are protected by Chinese laws.
Article 5The Ministry of Health and the Ministry of Foreign Trade and Economic Cooperation(MOFTEC) shall be responsible for the administration of all these institutions in China within their scopes of authority.
Health administrative departments of local governments at county level or higher(including traditional Chinese medical/medicine departments in charge) and the administrative departments of MOFTEC are responsible for the routine supervision over and administration of these institutions within their scopes of authority.
Chapter 2 The Requirements for Establishment
Article 6 The establishment and development of Sino-foreign joint equity or cooperative medical institutions shall be in conformity with the local regional health planning and the medical institutions establishment
program, and shall be carried out in compliance with the "Basic Standards of Medical Institutions"stipulated by the Ministry of Health.
Article 7 The Chinese as well as the foreign party applying for the establishment of Sino-foreign joint equity or cooperative medical institutions shall be legal person which are able to undertake civil liabilities independently. Both Chinese and foreign party shall have the experience of direct or indirect investment in and management of medical and healthcare services, and shall meet one of the following requirements:
(A) To be able to provide internationally advanced experience in managing medical institutions, as well as the management and service node.
(B) To be able to provide internationally leading medical techniques and equipment.
(C)Can complement or improve the insufficiencies with regard to local medical service capacity, medical techniques, funds and medical facilities.
Article 8 The Sino-foreign joint equity or cooperative medical institutions to be established shall meet the following qualifications.
(A)It shall be an independent legal person.
(B) The total amount of investment shall be no less than RMB20 million.
(C) The proportion of the equity right or the interests held by the Chinese party in a Sino-foreign joint equity or cooperative institution shall be no less than 30%.
(D) The term of operation shall be no longer than 20 years.
(E) Other qualifications stipulated by health administrative department at provincial level or above.
Article 9 The Chinese party to the venture who contributes by using state-owned assets (including the investment with the appraised assets or other terms of cooperation) shall be approved by the relevant departments in charge, and the state-owned assets to be invested shall be appraised by the appraisal agencies certified by state-owned assets management departments. The results of the appraisal, which have been confirmed by state-owned assets management department at provincial level or higher, may serve as the basis for the valuation of the state-owned assets to be used for investment.
Chapter 3 Approval and Registration
Article 10 To establish a Sino-foreign joint equity or cooperative medical institution, the applicant shall at the beginning apply to the health administrative departments at municipal level in the areas where the medical institution is to be located, and submit the following materials:
(A) Application Form for establishing medical institutions:
(B) Project proposal signed by legal representatives of both parties, and the feasibility study report on the establishment of such a medical institution;
(C) Certificate of registration (photocopies), identity certificate of legal representatives (photocopies), and bank credit certificate of both parties;
(D) Confirmation document of the appraisal report on the state-ownedassets to be used as investment, which is issued by state-owned assets management departments.
The health administrative departments at municipal level of the areas where such medical institutions are to be located shall conduct the preliminary examinations of the materials submitted by the applicant according to the medical institutions establishment programs and the regional health planning. Following the preliminary examinations,they shall make comments, and send the material of applications, together with
the local health planning and medical institution establishment programs, to health administrative departments at provincial level for examination and approval.
Article 11After level examining the application material and comments made by the health administrative departments at municipal level, the health administrative departments at provincial level shall submit the relevant materials to the Ministry of Health for final examinations and approval.
For final examinations and approval, the following materials shall be submitted to the Ministry of Health by the health administrative departments at provincial level:
(A) Materials of application for establishing the medical institution;
(B) The "Medical Institutions Establishment Programs" which are approved and issued by people's governments at municipal level, and the opinion given by the health administrative depamnents at both municipal and provincial levels in the areas where the intended medical institutions are to be located, as to whether or not the establishment of such medical institutions is in accordance with the local and regional health planning andthe medical institutions establishment programs;
(C) Opinions given by health administrative departments at provincial level with regard to the establishment of Sino-foreign joint equity or cooperative medical institutions, including, among them, the opinions on
the institution's name, location, scale (bedspace, dental-chairs, etc.), branches of treatment, and term of operations.
(D) Other documents required by Ministry of Health and related laws and regulations.
Ministry of Health shall make a written decision on whether or not to approve the application within 45 working days on the receipt of the application.
Article 12Applications for establishing the traditional Chinese medical institutions in the form of Sino-foreign equity or cooperative joint-ventures (including such ventures combining traditional Chinese medicine and Western medicine and the ventures using medicine of national minorities) shall go through the procedures, as stipulated in Article 10 and Article 11, of the preliminary examinations by the health administrative departments at municipal level and the assessment of health authorities at provincial levels in the areas where the intended medical institutions are to be located. The applications shall then be submitted to
the National Traditional Chinese Medicine Administration for examination and approval before they are sent to the Ministry of Health for the final examination.
Article 13 After receiving the approval of the Ministry of Health, the applicants shall, according to the relevant laws and rules, put forwardthe application to MOFTEC, and submit the following materials:
(A)The materials used in the application for the establishment and the approval documents;
(B) Contracts and articles of association signed by legal representatives or their authorized representatives of both parties to the Sino- foreign joint equity or cooperative medical institutions;
(C) List of the members in the board of directors to be set up, and the letter of appointment for the directors of both parties;
(D) Notice of preliminary approval for the name of the proposed institution issued by the administration of industry and commerce;
(E) Other materials required by MOFTEC and related laws and regulations.
MOFTEC shall make a written decision on whether or not to approve the application within 45 working days after receiving the application, and shall issue a "Approval Certificate for the Foreign-invested Enterprise" to
the applicant if the application is approved.
The Sino-foreign joint equity or cooperative medical institution whose establishment has been approved shall register with the state administration of industry and commerce with this "Approval Certificate" within a month after receiving this Certificate.
Article 14 The scopes and contents of medical services provided by those who apply to set up Sino-foreign joint equity or cooperative medicalinstitutions in the central and western part of China, or areas with insufficient resources are within the range of services encouraged by the state. The regulations of Article 7 and Article 8 may be implemented more flexibly by the competent restitutions.
Article 15 The approved Sino-foreign joint equity or cooperative medical institutions shall apply for operational permit with the health administrative departments prescribed by the local health administrative
departments at provincial level according to the measures and requirements on the operation registrations of medical institutions specified th the "Regulations on the Administration of Medical Institutions" and the
"Implementing Rules for Regulations on the Administration of Medical Institutions", and receive the "Practicing License for Medical Institution". According to the classifications and scales of the Sino-foreign joint equity or cooperative medical institutions, the health administrative departments at provincial level shall determine whether the health administrative departments at prvincial level, or the local health administrative departments at municipal level shall process their business registration and issue the provisions of the "Implementing Rules for Regulations on the Administration of Medical Institutions" to the registered institutions. The name of a Sino-foreign joint equity or cooperative medical institution shall be composed, in order, of the name of hte place where it is located, the name of identification, and the name for common use.
Article 16 The name of the Sino-foreign joint equity or cooperative medical institution comply with the provisions of the "Implementing Rules for Regulations on the Adidinistratinn of Medical Institutions". The
name of a Sino-foreign joint equity or cooperative medical institution shall be composed, in sequence, of the name of the place where it is located, the name of identification, and the name for common use.
Article 17 A Sino-foreign joint equity or cooperative medical institution shall not establish branches.
Chapter 4 Alteration, Extension and Termination
Article 18 In case an estebhshed Sino-foreign joint equity or cooperative medical institution alters its scale (bedspace, dentel-chairs, etc.), branches of treatment, or the term of operation, etc., it shall proceed according to the measures specified in chapter 3 to have the alterations examined and approved by the original departments and modify its registration at the original registration departments.
In case the alterations involve the modification of the contract and articles of association, they shall be submitted to MOFTEC for ratification via the local departments in charge of the foreign trade and economic cooperation.
Article 19 The term of operation for the Sino-foreign joint equity or cooperative medical institution is 20 years. If the term needs to be extended under special circumstances, the Chinese party and the foreign party may apply for the extension of term 90 days prior to the expiration of the term. After the application has been examined and verified by health administrative departments and the departments in charge of foreign trade
and economic cooperation at provincial level, it shall be submitted to the Ministry of Health and MOFTEC for final examination and ratificaton.
The approval examination and authority (the Mimstry of Health and MOFTEC) shall make a written decision on whether or not to approve the application within 45 working days after receiving the application.
Article 20The Sino-foreign joint equity or cooperative medical institution whose establishment has been approved shall complete the entire procedures of related registration within the time limit set by the approval authority; failure to do so may cause the project to be cancelled after the examination of the approval authority.
Chapter 5 Practicing
Article 21 A Sino-foreign joint equity or cooperative medical institution shall be an independent legal person, fully responsible for its own profits and losses, practicing independent accounting, and independently assuming its civil liabilities.
Article 22 The Sino-foreign joint equity or cooperative medical institutions shall observe the provisions concerning the operation of medical institutions specified in the "Regulations on the Administration of Medical Institutions" and the "Implementing Rules for Regulations on the Administration of Medical Institutions".
Article 23 The Sino-foreign joint equity or cooperative medical institutions shall implement the norms for the access of medical techniques, and the specifications of clinical diagnoses and treatments, and the relevant
stipulations on the clinical practice of new or large-scale medical equipment and new technology.
Article 24 The Sino-foreign joint equity or cooperative medical institutions shall employ in accordance with the "Law on Practicing Doctors of the People's Republic of China', and the "Administrative Measures on Nurses of PRC".
Article 25 Employment of foreign doctors and nurses by the Sino-foreign joint equity or cooperative medical institutions shall be processed in accordance with the "Law on Practicing Doctors of the People's Republic of China", and the "Administrative Measures on Nurses of PRC ".
Arliele 26 In case of great calamities, serious accidents or diseases, or other contingencies, the Sino-foreign joint equity or cooperative medical institution and its health and technical personnel shall obey the assignment by the health administrative departments.
Article 27 In case a Sino-foreign joint equity or cooperative medical institution releases its own advertisements, it shall prceed in ccordance with the "Advertising Law of PRC" and the "Administrative
Measures on the Medical Advertisement".
Article 28The Sino-foreign joint equity or cooperative medical institutions shall set its medical charges in accordance with the relevant stipulations issued by the State.
Article 29Taxation policies for the Sino-foreign joint equity or cooperative medical institutions shall be executed in accordance with the relevant stipulations published by the State.
Chapter 6 Supervision
Article 30The health administrative departments at county level or higher shall be responsible for the day-to-day supervision over and administration of the Sino-foreign joint equity or cooperative medical institutions within their administrative territories."Practicing License for Medical Institution" issued to the Sino-foreign
joint equity or cooperative medical institutions shall be examined once a year. The examination shall be conducted by the registration departments with which the medical institutions have made their business registration.
Article 31 The Sino-foreign joint equity or cooperative medical institutions shall be subject to the supervision of related departments in conformity with the related provisions governing foreign-invested enterprises pulished by the State.
Article 32 In case the Sino-foreign joint equity or cooperative medical institutions violate the related laws, rules, and regulations, they shall be investigated and dealt with by the relevant departments in charge according to laws. In case they violate the "Measures", they shall be penalized according to the related laws, roles, and regulations by the health administrative departments and the departments in charge of foreign trade and ceonomic cooperation at county level or higher.
Article 33In case the local health administrative departments and local departments in charge of foreign trade and economic cooperation violate the "Measures", by approving the establishment or alterations of the
Sino-foreign joint equity or cooperative medical institutions without authorization, the responsible personnel shall be called to account.
In case the Chinese party and foreign party establish the Sino-foreign joint equity or cooperative medical institutions without the approval of Ministry of Health and MOFTEC, and conduct medical activities, or carry
out diagnosis or treatment projects by means of contracts, they shall be considered illegally practicing and shall be penalized according to the 'Regulations on the Administration of Medical Institutions", the" Implementing Rules for Regulations on the Administration of Medical Institutions" and related stipulations.
Chapter 7 Supplementary Provisions
Article 34 Investors from Hong Kong and Macao or Taiwan who intend to establish joint equity and cooperative medical institutions in mainland China shall refer to the "Measures".
Article 35 No approvals shall be given to those who apply for establishing solely foreign-owmed medical institutions within the territory of China.
Article 36 The health administrative departments as well as the departments in charge of foreign trade and economic cooperation of all provinces, autonomous regions, municipalities directly under the Central Government may, in accordance with the "Measures', formulate specific provisions based on actual local conditions.
Article 37 Ministry of Health and MOFTEC shall be responsible for interpreting the "Measures".
Article 38 The "Measures" shall come into effect as of July 1, 2000.
Weiyizi [89] Document No.3 issued on February 10,1989(by Ministry of Health), and [1997]Waijingmaofa Document No.292 issued on April 30,1997(by MOFTEC) shall be annulled simultaneously.
