A set of new provisions that took effect on January 1, 2009 further opens the medical services market in Guangdong Province of the PRC to qualified Hong Kong and Macao service providers. These provisions are entitled Supplementary Provisions II on the Interim Measures for the Administration of Sino-Foreign Equity Joint Venture and Contractual Joint Venture Medical Institutions (Supplementary Provisions II).
The Ministry of Health (MOH) and the Ministry of Commerce (MOFCOM) issued Supplementary Provisions II to complement the Interim Measures for the Administration of Sino-Foreign Equity Joint Venture and Contractual Joint Venture Medical Institutions in accordance with the Mainland-Hong Kong Closer Economic Partnership Arrangement and the Mainland-Macao Closer Economic Partnership Arrangement (CEPAs).
The Measures, which were promulgated in 2000, required that the total investment in a Sinoforeign joint venture medical institution be no less than RMB20 million, and that the proportion of equity or interest owned by the foreign party be no more than 70 percent. In addition, the Measures prohibited the establishment of any wholly foreign-owned medical institutions in the PRC. The first set of supplementary provisions to the Measures (Supplementary Provisions I), which took effect on January 1, 2008, lowered the RMB20 million threshold to RMB10 million for Hong Kong and Macao Service Providers (as defined under the CEPAs). Supplementary Provisions II, however, removed all restrictions on the investment amount and equity-holding percentages for Hong Kong and Macau Service Providers. However, these Service Providers may only set up medical clinics (as opposed to hospitals), and such clinics must be located within the territory of Guangdong Province. Under Supplementary Provisions II, MOH and MOFCOM further delegate authority to their local branches in Guangdong Province to approve the establishment of such clinics.