Question: Q1: Upon implementation of the Foreign Investment Law of China, will the foreign party be allowed to use capital sources other than profits from domestic enterprises in China?

Answer: A1: According to relevant regulations, foreign investors can contribute using RMB profits from other foreign-invested enterprises established in China. In addition, they can also make reinvestments in China with RMB funds obtained from liquidation, equity transfers and advanced investment recovery of foreign-invested enterprises which they have already invested in. These methods are all treated the same as foreign exchange investment under this policy.