China eases investment ruling

China eases investment ruling

BEIJING: China is to raise the foreign ownership limit for domestic airlines to 49 percent from 35 percent in an attempt to attract more overseas investment to the industry, officials said Tuesday.

The new regulations, which will take effect from Aug. 1, will allow foreign companies to buy shares and directly invest in airlines, said a spokesman for the Civil Aviation Administration of China.

Previously, foreign investors were only allowed to set up joint ventures and partnerships.

The new rules will also allow foreigners for the first time to hold the posts of president or chief executive of domestic airlines.

However each foreign investor is limited to a maximum 25 percent stake, and the Chinese partner must always hold a majority, said the spokesman, who gave his name as Ma. -- AFP