China to Relax Restrictions on Foreign-Invested Travel Agencies
On February 20, 2009, the State Council released
the Regulations on Travel Agencies (the "Regulations"), effective May 1,
2009. The Regulations relax restrictions
on foreign-invested travel agencies and reflect China's commitment to agreements
made upon its entrance into the World Trade Organization. According to the Regulations, wholly-foreign-invested
travel agencies, which were previously forbidden, are now permitted in China.
Furthermore, the Regulations loosen the statutory requirements for
foreign-invested travel agencies, such as registered capital and investor
qualifications, and now also permit the establishment of branch offices by
foreign-invested travel agencies. Under
the new Regulations, foreign-invested travel agencies generally have a legal
status similar to domestic travel agencies.
However, the Regulations still contain a requirement that
foreign-invested travel agencies be pre-approved by the National Tourism
Administration and the Ministry of Commerce ("MOFCOM"). Foreign-invested travel
agencies are also subject to different rules for operating overseas traveling
businesses targeted at PRC citizens.
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