As to the matter that foreign investment enterprises merge the domestic enterprises, the Commission For Economic Planning and Development will propose the measures to loose the above matter.

The restriction regarding that foreign investment enterprises merge the domestic enterprises will be made loose. The Commission For Economic Planning and Development in June will propose relevant report on the confidentiality and time of the issue of foreign investment enterprises merging the domestic enterprises. Besides, the said proposal will also allow off-floor trading.

The Investment Commission agrees that the domestic enterprises merged by the foreign investment enterprises are not limited to listed companies. Besides, as to the regulation that the foreign investment enterprises should apply for merging the domestic enterprises so as to win over the operation right, which is supervised by the Securities and Futures Commission (SFC), this regulation is planned to be made loose and the off-floor trading is permitted, which excludes the provision stipulated in Article 150 of the Securities Law. Furthermore, the foreign investment enterprises could apply for the first stage inspection made by Investment Commission subject to “Foreign Investment Act” and accordingly its application for merging shall not be inspected by the Securities and Futures Commission anymore so that their application could be kept confidential. (2004.03)

CYJ/WYL