China Spurring Foreign Investment in Its Road Transport Sector


With the recent release of a Circular Concerning the Further Opening of the Road Transport Sector to Foreign Investment by the PRC Ministry of Transport (MOT), foreign investors are now permitted to hold a controlling stake in a Sino-foreign joint venture company, which is engaged in road transport services in China. According to the Circular, effective from 1st December 2002, foreign investors wishing to participate in a company which is engaged in one or all of the following services may, upon the approval of the MOT, hold ownership not exceeding 75%:

  • freight transportation by road
  • loading and unloading of cargo transported by road
  • road cargo storage and warehousing
  • ancillary services relating to road transportation; and
  • relevant vehicle maintenance services

This substantially changes the previous position that a Chinese party must take a majority shareholding in a joint venture engaged in road transport services. According to China's WTO commitment, foreign majority ownership for road transport should be permitted within one year after China's accession and, within three years after China's accession, wholly foreign-owned subsidiaries will also be permitted.

If you need more information on this, please contact Luke Filei on +86 21 628 96363 or at [email protected]

For more information on China joining the World Trade Organisation and the opportunities for many industry sectors, please go to our Doing Business in China toolkit on our Law-Now Asia site: