Foreign-funded companies to be granted same treatment as Chinese firms in govt procurement

Products manufactured by foreign-funded companies in China will be eligible for the same price preference for domestic goods in government procurement bids, China's Ministry of Finance (MOF) has said.

A recent MOF notice seeking public comment unveiled a 20 percent price preference in government procurement for goods produced domestically.

The policy will treat domestic and foreign-funded enterprises equally, the ministry said, noting that any company, regardless of its ownership, can benefit from the policy as long as its products meet the criteria.

The equal treatment reflects China's firm determination in opening up, as continued efforts have been made in recent years to create a level playing field for all market players.

The country pledged to ensure national treatment for foreign-funded enterprises in terms of access to factors of production, license application, standards setting and government procurement, according to the resolution adopted at the third plenum of the 20th Central Committee of the Communist Party of China held in July this year.

According to the MOF notice, products eligible for the latest favorable policy must be manufactured within China's customs territory throughout their production stages from raw materials to finished goods.

The notice also specified the required ratios for domestic components of a product and stipulated that for certain items, the production of key parts and essential processes must take place in China.

These domestic product standards will be established gradually and will primarily apply to goods in the industrial sector, excluding agricultural, forestry, livestock and fishery products, as well as mineral resources.

The policy was drafted after drawing on international experience and considering conditions in China, the ministry said.

The ministry stated that the policy is designed to foster a unified, open and competitive government procurement market, as well as a market-oriented, law-based and internationalized business environment.

The new measures are open for public opinion till January 4, 2025, said the notice.