16 February 2017

The “Ethnic Chinese Card” is coming!

By Jiang Junlu  (partner)  Pei Xiu (associate)

Since the idea of the Ethnic Chinese Card (“ECC”) was raised by Hong GUO (Director of the Administrative Committee of Zhongguancun) on 27 November 2015, Chinese communities worldwide have been following the discussion with interest. 

On 13 March 2016, Yuanping QIU, Director of the Overseas Chinese Affairs Office, stated in an interview that China had no plans to launch the ECC. At the end of 2016, the ECC once again came into the media spotlight, but the most recent official statement remains that of Director QIU. The Administrative Committee of Zhongguancun has proposed to pilot the ECC system but when this will happen is unclear. 

What exactly is the ECC? How will it affect Chinese foreign nationals in China? What would be its social implications? This article will discuss these questions.

1. What is the Ethnic Chinese Card?

The ECC is a special identity certificate for Chinese with foreign nationality. The Card is similar to the Chinese green card, but easier to obtain. ECC holders would be able to enter and exit China without a visa, and stay for as long as they wished. They would also be entitled to the same rights as Chinese citizens in regards to the making of investments, the purchase of real estate, opening of bank accounts, ability to obtain a driver’s license and the ability to educate their children within the Chinese system. The ECC is equivalent to the Chinese green card for Chinese with foreign nationality.

2. What will the ECC mean for ethnic Chinese? 

The ECC will impact ethnic Chinese in three main ways:        

Firstly, on the formalities of entry and exit, and duration of stay. Many ethnic Chinese stay in China for long periods for the purposes of making investments, employment and family reunions. However, since they are foreigners, they need both a passport and visa (for example - working visa, reunion visa) for entry. They must apply for a residence permit and can only stay in China for a specified period. The ECC would allow ethnic Chinese to stay in China for as long as they wanted, even permanently, without a visa or residence permit. 

Secondly, in regards to employment. Currently, Chinese foreign nationals must obtain permits (such as a work permit or a specialist permit) and apply to change or renew them when necessary. Failure to do so constitutes illegal employment. The ECC would entitle holders to legally work in China without a permit. This supersedes the rights of residents of Hong Kong, Macao and Taiwan who need to obtain permits to legally work in China. 

Thirdly, on the ease of living in China. Non-nationals are restricted in China in many ways. For example - in their ability to obtain medication, purchase property, make investments, open bank accounts, receive a Chinese education, obtain a driver’s license, and utilize transportation (for example, purchase a train ticket using their real name). Compared with Chinese citizens, there are many restrictions on foreigners in China. Under the ECC system, ethnic Chinese would enjoy equal treatment to Chinese citizens in almost everything except political rights.

Taking medical insurance as an example, foreigners are only entitled to insurance if they are employed and their employer pays social insurance for them. Otherwise, they are subject to high medical expenses in China. But ECC holders would be able to pay social insurance and obtain the same medical insurance treatment as Chinese citizens, regardless of whether or not they are employed in China.

Commentators have suggested that implementation of the ECC would equate to China’s acceptance of dual nationalities. 

That would not be the case.

Chinese citizens not only enjoy social and economic rights, but also political ones, such as the right to vote, to stand for election and to serve as a civil servant. Neither ECC holders nor permanent residents could enjoy political rights in China. They would not be able to participate in the NPC (National People’s Congress) election or serve as members of the CPPCC (Chinese People’s Political Consultative Congress). In addition, they would not be able to serve in state organs or hold certain positions in state-owned enterprises. So the ECC only entitles its holders to specific advantages within the Nationality Law for Chinese foreign nationals whose skill sets are under demand. It would not equate to the acquisition of Chinese nationality. Not all Chinese foreign nationals would be able to get the card, although it would be easier to obtain than the Chinese green card. There are certain requirements to obtain a green card. For example, the applicant must have a talent in a specific field, have special skills necessary for developing the economy and society, or be willing to make large investments in China.

3. Social implications of the ECC.        

News of the ECC became a hot topic overnight. Not only does it interest overseas Chinese but it also interests domestic media. 

Commentators have questioned the fairness of giving advantages to foreign Chinese that equate to treatment only Chinese citizens have enjoyed in the past. Their concern is that this may encourage more Chinese to expatriate.

There are a large number of IT specialists in the ethnic Chinese population with the potential to improve the Chinese economy. Unlike other foreigners, ethnic Chinese have a natural bond with China, having Chinese parents and often having lived in China themselves, they are familiar with Chinese culture. Having seen great opportunities in China, longing to reunite with friends and family - what power can stop them from returning home? It would be detrimental to the unity of people, and the unity of strength to put barriers in the way of their return.

Similar policies to the ECC have been launched in India, encouraging overseas Indians to return. Like India, China is a developing country in a stage of rapid development, with the same need for specialist workers as India. So, why not enact the ECC, so these much needed specialists can return home and stop the expatriation of skilled Chinese citizens?

For a long time, China has upheld that overseas Chinese, returned overseas Chinese and their relatives are within the scope of the united front. The primary purpose of the overseas united front is “uniting overseas Chinese, converging their intelligence, putting use to their power, protecting overseas Chinese, returned overseas Chinese and their relatives, as well as guiding them to devote to the nation’s modernization and peaceful reunification”. 

Over the last two years, in order to attract foreigners (including ethnic Chinese) to China, the government has reformed the permanent residence process to make it more efficient. The Ministry of Public Security launched twenty immigration policies to support the development of Beijing, of which a policy on facilitating residence and entry/exit for returned overseas Chinese entrepreneurs takes the lion’s share. The policy was piloted in Zhongguancun. In 2016, Zhongguancun initiated nine services for foreigners (including ethnic Chinese), including visa and residence, and special channels for applying for permanent residence.  

The above policies and systems lay the groundwork for the ECC. In the near future, we hope to see the birth of the ECC, and witness firsthand the joy of ethnic Chinese as they return to their homeland.

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