Auto Industry
Updated: 2006-04-18 11:18
Auto Industry's WTO Commitments
Under the commitments of China's accession to the World Trade Organization,
as it is outlined in the protocol and annexes, as well as in the Working Paper
Report, China will gradually liberalize the domestic automotive market with
respect to such fields as tariffs, non-tariffs, investments and trade in
services.
1. Tariff and non-tariff measures
(1) On 1 July, 2006, the auto import duty will be reduced to 25 percent on
average and auto-parts tariffs will fall to 10 percent on average.
(2) The
initial quota value of imported automobiles in 2002 was US$6000 million.
Currently the quota growth rate is 15 percent per year. On January 1, 2005, all
import licenses and quotas will be eliminated.
2. Investment measures
(1) The elimination and cessation of enforcing trade and foreign-exchange
balancing requirements, local content requirements and export performance
requirements, offsets and technology transfer requirements made effective
through laws, regulations and other measures.
(2) Amendments to ensure the
lifting of all measures applicable to motor vehicle producers restricting the
categories, types or models of vehicles permitted for production (to be
completely removed two years after accession).
(3) Raising the limit within
which investments in motor vehicle manufacturing could be approved at the
provincial government level from the current US$30 million to US$60 million one
year after accession; US$90 million two years after accession and US$150 million
four years after accession.
(4) With respect to the manufacture of
motor-vehicle engines, removing the 50-percent foreign equity limit for joint
ventures upon accession.
3. Trade in services related to automobiles
Foreign investment will be permitted to enter the following fields: internal
sale of automobiles and parts, import and export of automobiles and distribution
services, transport companies for operation, installments on automobiles,
leasing and financing motor vehicles for production.
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