The Ministry of Commerce and the State Administration of Industry and Commerce yesterday published an administrative rule governing organizations in overseas labor exports, lifting thresholds higher.

The rule, which will take effect 30 days after publication, sets more stringent conditions for companies dealing in the business of providing laborers abroad.

The rule said companies in such businesses should have a minimum registered capital of 5 million yuan (US$604,000). Its ratio of debt/assets should not be larger than 50 per cent and the company should have fixed office space of more than 300 square meters.

The rule also stipulates that the company should obtain ISO9000 certification, authentication for management; and have at least five professionals in the field including those responsible for training and legal affairs.

The rule requires more specific stipulations about quality of management compared to the previous rule, which focused more on registered capital and trade volume.

"Companies, which have previously obtained business licenses, should meet the requirements in one year," the rule said.

Companies submitting applications to their local commercial authority will get a response in about one month.

Li Wei from the University of International Business and Economics said the stricter rule is expected to improve the situation of the business of exporting labor, especially as the security of overseas labor was highlighted recently.

The security of Chinese workers abroad has generated a great deal of public interest after terrorist activity recently brought the issue into the headlines. In the past two months alone, 14 Chinese workers have been killed and 13 injured in terrorist attacks.

The rule will help improve the safety and management of overseas workers, Li said.

There are now about 1,400 Chinese firms licensed to contract and export labor abroad.

After two decades of rapid development, China's labor export industry has expanded to more than 180 countries and regions and China has become one of the world's top 10 countries for overseas contracts.

Statistics from the China International Contractors' Association suggest there are more than 500,000 Chinese laborers working abroad. They are employed in industries ranging from construction and transport to domestic help, medical services, mining and textiles.

In China, there are two main legal avenues for exporting labor. The first is project based, a hangover from aid projects in the 1970s, when State-owned companies would send workers to other developing countries. The second channel is via companies specializing in sending people abroad for work, usually in construction but also in areas such as manufacturing and agriculture.

The chief destinations are East Asia, Southeast Asia, North Africa, North America, the Gulf and Europe, Li said.

The rule said the ministry will give warnings and order monetary penalties if these companies violate the rules. They may even face punishment in criminal courts.

The ministry will also regularly publish a list of wrong-doing companies.

(China Daily August 3, 2004)