State-Owned Assets Supervision and Administrative Commission (SASAC) published ‘Management measures for supervising central SOE overseas investment’, replacing the 2012 version.
The document stipulates
- general provisions
- SASAC will strengthen its capital management role by
- controlling investment direction
- optimising investment layout
- regulating capital and its safety
- increasing return on investment
- central SOE overseas investment should
- be strategic—integrate domestic and overseas strategies, increasing innovation and international competitiveness
- adhere to local legislation, regulations and customs
- match capabilities—the investment scale should match companies’ financing, risk management and experience
- reasonable ROI—strengthen investment argumentation and management to increase ROI
- SASAC will strengthen its capital management role by
- investment supervision
- setting up a negative list management system; central SOEs
- are restricted from investing in items listed in the ‘prohibited catalogue’
- should submit applications for SASAC review to invest into the ‘special supervision’ list
- setting up a negative list management system; central SOEs
- pre-investment management
- central SOEs should
- submit application for SASAC review if they want to invest in ‘special supervision’ items
- not invest in items outside their major business; excepting when under SASAC’s supervision
- central SOEs should
- investment management
- central SOEs
- are responsible for analysing and tracking investment environment
- should submit quarterly reports to SASAC
- central SOEs
- post-investment management
- submit annual reports
- draft evaluation reports
- all-around auditing
- strengthening risk management
- central SOEs to introduce state-owned investment operation companies and private investment agencies, local investors, international investment agencies that understand investment risk control and PR coordination
- review third-party commissioned reports on local politics, economy, society, culture, market and legislation or policies for key overseas investment projects
- strengthen government agencies’ connection and coordination with overseas embassies and consulates
- make full use of insurance
- set up win-win opportunities by
- enhancing PR relations with local government, media, enterprises, communities
- fulfilling CSR responsibilities
- integrating with local culture and creating better investment environments
- accountability
- supplementary provisions