The total investment of a foreign-invested enterprise refers to the total investment stipulated in the contract, that is, the sum of the enterprise's capital contribution and construction funds, also known as working capital. In addition to the registered capital, it shall also include the following five items:
1. Borrow money from banks or others in the name of enterprises.
2. Assets or liquidity purchased by profit-making enterprises.
3. Unregistered investment increased by distributable profit enterprises.
4. Additional investment by shareholders but unregistered capital.
5. Bank deposits.
The difference between the total investment and the total investment of the project is as follows:
1. In engineering construction, the total investment is divided into two types, one is project capital, and the other is total investment (including project capital and loans).
2. Total investment is the overall capital demand of the project, and it is a unique concept in the Law on Enterprises with Foreign Investment. China has no concept of total investment. In terms of composition, the total investment actually includes the registered capital paid or subscribed by investors and loans from foreign-invested enterprises.
3. The total investment fund of the project consists of three parts: construction investment, interest during the construction period and working capital. The specific contents include: engineering construction costs, equipment and instruments procurement costs, installation costs and other engineering construction costs.
The historical reason for the emergence of the concept of total investment is that at the beginning of opening to the outside world, the so-called foreign-invested enterprises were actually enterprises in the sense of project companies, not market players in the general sense, but enterprises that existed within the validity period for a specific construction project. When the state approves the establishment of foreign-invested enterprises, it also approves the scale of foreign-invested enterprises, that is, the total investment of foreign-invested enterprises.
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In the actual supervision of foreign investment, the total investment has four meanings:
1. Determine the registered capital of foreign-invested enterprises according to the total investment.
2. Determine the duty-free import quota of self-use equipment of foreign-invested enterprises according to the total investment.
3. Determine the foreign exchange loan amount of foreign-invested enterprises according to the total investment.
4. Determine the division of examination and approval authority of foreign-invested enterprises according to the total investment.