China to Allow Foreign Investors to Set Up Mainland Senior Care Institutions
Jun. 13 – China’s Ministry of Civil Affairs issued a circular to invite public opinions on the “Approving Measures for the Establishment of Senior Care Institutions” and the “Administrative Measures for Senior Care Institutions” on June 3. The two draft rules clarify the establishment conditions for the senior care institutions and explicitly allow foreign investors to set up such institutions in Mainland China. Detailed information can be found below.
A senior care institution established in Mainland China shall meet the following requirements:
- The establishing entity shall either be an existing lawfully established organization or an individual with full capacity for civil conduct
- It shall have its own name, domicile, articles of association and management system
- It shall have more than 10 beds
- It shall have qualified administrative staff, professionals and service staff to render services
- It shall have basic living rooms, facilities, equipment and activity space that meet the specifications and technical standards relating to senior care institutions
- It shall have the funds that match its service contents and scale
- It shall meet other conditions stipulated by relevant laws and regulations
Senior Care Institutions Established by Foreign Investors
Moreover, the draft rules allow foreign investors to set up senior care institutions in Mainland China in the following ways:
- Senior care institutions solely invested by foreign organizations or individuals
- Senior care institutions jointly established by foreign organizations or individuals with Chinese organizations or individuals in the form of an equity joint venture or a cooperative joint venture
- Senior care institutions solely invested by overseas Chinese, or organizations or individuals from the regions of Hong Kong, Macau or Taiwan
- Senior care institutions jointly established by overseas Chinese, or organizations or individuals from the regions of Hong Kong, Macau or Taiwan with Chinese organizations or individuals in the form of an equity joint venture or a cooperative joint venture
The establishment of the senior care institutions by the above-mentioned organizations or individuals shall be approved by the local civil affairs authorities of the provincial people’s governments or the civil affairs authorities of the municipal people’s governments designated by their provincial-level counterparts.
The draft rules also stipulate that elderly services provided by senior care institutions should include daily care, rehabilitation care, spiritual comfort service, and cultural entertainment. Moreover, senior care institutions that discriminate against, insult, mistreat or abandon the elderly could face fines up to RMB30,000, and will be held accountable for any actions that violate the law.
Caring for the elderly group has already become a pressing issue for the country. In 2012, there were about 3.9 million beds in senior care institutions across China, while at the same time, the number of citizens aged over 60 in the country reached 194 million. This figure is expected to reach 221 million by 2015.
The draft rules are currently seeking public opinions and comments, and such feedback can be submitted via the methods below through June 23, 2013.
- Website: Log on to www.chinalaw.gov.cn, and submit comments through the “Law and Regulation Draft Feedback System.”
- E-mail: email@example.com
- Address: Policy and Regulations Department, Ministry of Civil Affairs, No.147, Beiheyan Street, Dongcheng District, Beijing, 100721
Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia.
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