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China to Remove Foreign Ownership Ceilings for Auto Sector by 2022 to Further Open Up Car Market

Updated:2018-4-18 10:44:54    Source:www.tannet-group.comViews:136

It is reported that China will eliminate foreign stake limits on commercial vehicle firms in 2020 and lift restrictions on passenger vehicle firms in 2022, in a move to further open up the world’s largest car market.

In a statement on its website on Tuesday, China’s state planner, National Development and Reform Commission (NDRC), said the country will allow full foreign ownerships following a five-year transition period and scrap foreign ownership caps on firms making fully electric and plug-in hybrid vehicles in 2018.

This move came on the heels of Chinese President Xi Jinping’s speech at the Boao Forum for Asia last week where he said the country will scrap ownership limits for the auto sector “as soon as possible”.

Foreign automakers such as Tesla are poised to benefit from the loosened rules as it has been seeking to set up a wholly owned plant in Shanghai.

Currently, foreign carmakers are allowed to hold no more than a 50-percent stake in an auto company registered in China, a policy put in place since 1994 to support domestic carmakers in competing against international brands.

China will also remove all foreign ownership limits in the ship and aircraft manufacturing industries this year. (Source: CGTN)

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