March 23, 2009: The State Council Legislative Affairs Office and the China National Tourism Administration have held a press conference on a regulation titled "Provisions for Travel Agencies", which will be enacted on May 1, 2009, allowing Chinese domestic travel agencies to provide inbound travel services.
Zhao Xiaoguang, a director of SCLAO, says that there has been a dramatic increase of inbound tourists in China in recent years and it is difficult for the existing travel agencies to meet this market demand, that´s why the domestic travel service providers will be allowed to run inbound travel services under the new provisions. In addition, the provisions have lowered the threshold for companies to run inbound travel services by reducing the registered capital from required from CNY1.5 million to CNY300,000.
The Provisions for Travel Agencies was passed by China´s State Council on January 21, 2009 and signed by Premier Wen Jiabao the following day to be formally implemented on May 1, 2009.
According to the provisions, the tourism supervision department shall reduce the deposit of travel service providers who have not received any punishment as a result of infringing consumers´ right for a period of three consecutive years by 50%; foreign investors can set up foreign-funded travel agencies in China; and travel service providers may be fined up to CNY500,000 for illegal operations or providing services beyond their business scope.
