The prohibition is only being lifted partly, with foreign firms required to form joint ventures with domestic counterparts and must have provincial licensing, top officials said Wednesday in Beijing.

The new rules are a "step by the government to adjust its personnel policy and follow the principles of the World Trade Organization ( China is expected to formally join the WTO early next year.

Under the rules, the government must approve qualified domestic companies to work with foreign ones in the personnel services field. The government also will intensify its supervision and administration over the employment services market by probing companies found to advertise false information. Unlicensed firms could face fines of up to 30,000 yuan (US$3,600).

China's job market is big enough for more players. The ministry's statistics show that more than 3,700 personnel services companies operate here. They held more than 10,000 job fairs last year participated by 480,000 organizations and visited by 12 million people.

The industry's opening-up will benefit both domestic and foreign headhunting firms, experts say.

Hou said he hopes the access of overseas investors to China's personnel sector will bring in advanced management expertise and force overseas companies to improve their domestic services.

"This will help China create a much better environment for fostering native expertise, particularly those having senior professional titles above associate professors,'' Bi Xuerong, an official of the Ministry of Personnel said.

Attracted by China's huge market potential, some overseas job agencies have already begun carrying out business in China without official approval. More are waiting to rush in when it is permitted by law.

Some domestic agencies are concerned the foreign firms will run them out of business. Among the fears are the foreign headhunters who are of the same nationality as foreign firm chiefs may enjoy advantages in landing contracts.

Domestic firms, by contrast, may be smaller, lacking capital and connections and have a limited data.

(China Daily September 20, 2001)