Infrastructure construction programs in Beijing will no longer be operated exclusively by the government. From October 1, Beijing will carry out a franchise system to absorb individual and foreign investment. It means in the future, any domestic or foreign organization and individual has the right to invest in infrastructure construction in Beijing. Recently, officials at Beijing municipal law office answered relevant questions for Beijing Youth Daily.

 

Reporter: What's the significance of implementing this measure?

 

Law office: It prescribes that in the future any domestic or foreign organization or individual may invest and operate infrastructure constructions in Beijing. According to this measure, enterprises in China or abroad, and other organizations are all equal in competing for infrastructural franchises in line with regulations.

 

Reporter: Why will the government implement the measure?

 

Law office: The purpose is to promote the market of the city's infrastructure construction, expand investments and protect the rights of investors, franchisers as well as consumers.

 

Shortage of investment in city infrastructure has meant a big problem for governments at various levels, as infrastructure constructions needs a lot of money that the government usually cannot afford. The implementation of the franchise system may help better absorb and take advantage of individual and foreign investments in the local city's infrastructure construction. It's also conducive to reducing government operation costs and providing better public products and services to society.

 

Reporter: Currently, what kinds of infrastructure are allowed for franchise?

 

Law office: During a set time, enterprises and other organizations may operate the following infrastructure: water supply, heating, gas, drainage, disposal of sewage and solid garbage, toll charging, subway trains, city railway and other public transportations and city infrastructures.

 

Reporter: By what means can franchisers operate?

 

Law office: First, in the allotted time, the franchiser is permitted to be in charge of the investment, construction and operation of the program. When the deadline is over, the program should be transferred free of charge. This is suited to newly established infrastructure programs. Second, during a set time, the franchiser is allowed to take over the operation of the city infrastructure program. When the deadline is over, the program should be transferred free of charge. This one suits existing programs. Third, in an allotted time, the franchiser will be in charge of offering public services, such as the operation of public transportation. Fourth, other ways granted by the municipal government.

 

Reporter: How can franchisers get a return on their investment?

 

Law office: The measure stipulates that franchisers may charge for public products they offer; enjoying the rights to open and operate other business related to the city's infrastructure. They also enjoy relevant government subsidies as well as other income generating systems granted by the municipal government.

 

(China.org.cn translated by Li Xiao, September 25, 2003)