China's Ministry of Commerce (MOFCOM). Photo: VCG

China's Ministry of Commerce (MOFCOM) announced on Thursday that it will implement a tariff reduction and exemption policy for imported equipment for encouraged foreign investment projects, providing detailed measures and guidance. It urged responsible authorities to study relevant policies encouraging foreign investment and assist involved enterprises in properly reporting for corresponding projects.

The notice provides guidance for enterprises and investors in filling information for reporting for encouraged foreign investment projects, while also clarifying detailed implementation measures for responsible authorities handling reports on information changes.

For example, investment projects falling into the encouraged category, supported by foreign-funded Chinese enterprises, will be directly handled by the provincial commerce department, which will then inform the projects’ information to corresponding customs authorities.

The issuance of the notice is one of the moves amid China’s continuous efforts to promote high-quality opening-up while further optimizing the business environment.

MOFCOM has been conducting investigations and a special clean-up targeting possible provisions and measures that discriminate against foreign-funded enterprises.

The move aims to create a fairer environment for foreign-funded enterprises to compete in the Chinese market, stabilize foreign investors' expectations and confidence in long-term investment in China. He Yadong, spokesperson of MOFCOM, stated during a press conference on Thursday that the goal is to more actively and effectively utilize foreign investment to construct a new development pattern in China.

Moving forward, the ministry will strictly implement the Foreign Investment Law, promote the construction of legal regulation in foreign investment on a regular basis, and continue to build a first-class business environment that is market-oriented, law-based, and internationalized.

Overseas-funded firms’ confidence in the Chinese market has risen lately. As of the end of September, there were 684,000 overseas-funded enterprises registered across the country this year, indicating an increase of 1.5 percent from the end of 2022, according to the State Administration of Market Regulation on Tuesday.