Ownership Limits Further Relaxed by MCT for Foreign Investors of Entertainment Venues in China2021-06-28198
Ministry of Culture and Tourism
DATE OF ISSUANCE:
May 27, 2021
The Ministry of Culture and Tourism (MCT) recently issued the Circular on Adjusting Approval Related Matters for Entertainment Venues and Business Premises of Internet Access Service (the “Circular”), further relaxing the restrictions of foreign investment in China’s entertainment market.
The Circular states that the previous restrictions on maximum ownership proportions for foreign investors no longer apply. As a result, foreign investors may now set up entertainment venues in China with no ownership restrictions. Foreign investors intending to engage in the entertainment industry shall make an application to the provincial level of culture and tourism authorities. The application documents, procedures and establishment conditions will be the same as for domestic investors. Investors from Hong Kong, Macau and Taiwan shall also follow the same conditions and procedures to set up entertainment venues in mainland China.
China has been planning to remove the restrictions on the foreign investors’ proportion of equity in the establishment of entertainment venues since 2013 within the area of China (Shanghai) Pilot Free Trade Zone. Not until the end of 2020 were foreign investors allowed to establish entertainment ventures all around the country. By cancelling the ownership limits and providing equal treatment for foreign business as domestic businesses, China further deepens its opening-up to favor global post-pandemic tourism.
In addition, the Circular further provides that no entertainment venues or business premises of Internet access service shall be allowed to set up around kindergartens or schools. The provincial level of culture and tourism authorities are also required to cooperate with other authorities at the same level to ensure smooth approval procedures, and the State Council’s reform requirements of “Separating Operating Permits and Business Licenses” shall also be implemented in handling approval related matters for entertainment venues or business premises of Internet access service.