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Shanghai vows to intensify SOE reform Shanghai, the nation's economic hub, yesterday reaffirmed its resolve to encourage foreign investments to purchase or merge with State-owned enterprises (SOE), including this in a new regulation for property rights exchange, which starts today. In the first 10 months of this year, the city has seen an inflow of nearly 4 billion yuan (US$483 million) of foreign capital to SOEs, according to Wu Hongmei, deputy director of State-owned Assets Supervision and Administration Commission of the Shanghai Municipal Government. Shanghai United Assets and Equity Exchange Centre (SUAEE) one of the three pilot exchange centres for SOE properties designated by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC) has opened a service desk for foreign investors. The other two exchange centres are Beijing Equity Exchange Centre (BEE) and Tianjin Property Rights Transaction Centre (TPRTC). "The new regulation contains preferential policies in order to smooth the procedure and encourage more non-SOE property transactions," said Wu. "Upon receiving the application to change the property ownership, related departments must decide the change within 15 working days." The new regulation also stipulates that any selling of SOE or COE (collectively-owned enterprise) properties must be approved by a meeting of its staff. "SOEs and COEs must submit certain certificates to prove that their staff consent to entrusting the SUAEE to sell the properties," said Wu. And the transaction contract of the said property rights must include detailed plans dealing with the welfare of its retired employees. Shanghai started property transactions in 1994, and "has been exhibiting strong growth," said Wu. The total transaction volume in 2003 was 324.4 billion yuan (US$39 billion), compared to 17.2 billion yuan (US$2.1 billion) in 1993. And by the end of October, transactions had already exceeded 300 billion yuan (US$36 billion), an 18 per cent rise year-on-year, she said. "Property transaction has served as a major platform for the reform and strategic economic restructure of SOEs for many years," said Wu. "It channelled lots of social capital into different areas and greatly improved the city's social and economic development," "In the first 10 months of this year, SOE properties constituted some 72 per cent of all transactions." And more types of properties have been included in this category in recent years. "Apart from dealing in SOE properties, more private and foreign ones are now seen in the market," said Wu. "And more know-how and intellectual property rights transactions are being conducted too instead of just dealing in tangible property." With the diversification of transactions, it is necessary to update the city's first property rights transaction regulation established in 1998, according to Wu. And at the end of last year, the country issued new measures to regulate SOE property transactions, stipulating a transparent information release system and bidding modes for transactions. The new regulation places emphasis on stricter government supervision, according to Wu. "The State-owned Assets Supervision and Administration Commission of Shanghai municipal government is in charge of the management of the property transaction market," said Wu. |
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