CHINA will retain at least a 30 per cent stake in state enterprises following their restructuring under the provisional guidelines governing state holding of shares in companies. Setting rules on the minimum holding the state can have in enterprises is part of a number of enterprise reforms the state is carrying out, but it still wants to retain its primary position. The state had maintained a majority position in state enterprises to avoid buyouts by foreign firms, but now the main concern is whether the value of a state's assets, in the form of holdings in enterprises, can be safeguarded. According to a report by Xinhua (the New China News Agency) yesterday, retaining the state's controlling position in state enterprises would be either 'absolute or relative'. 'An absolute position refers to the state holding more than a 50 per cent stake in an enterprise, whereas a relative position is more than 30 per cent, but less than 50 per cent,' it said. The state holding in an enterprise is decided after a company is restructured into joint-stock entity. It is understood the state would have a tighter grip on enterprises in the country's key and strategic sectors. Jointly issuing the guidelines on share holding are the National Administrative Bureau of State-owned Property and the State Commission for Restructuring the Economic Systems. The guidelines will clearly identify state holdings in the setting up of joint-stock companies. The valuation of state assets should comply with guidelines issued by the State Council, China's cabinet. China is concerned about the loss of state assets as a result of improper handling in shareholding restructuring. Another area of concern was dividends attached to state-held shares. According to the rules, payouts of state-held shares should go to the Bureau of State-owned Property, which could run occasional checks on the management of state-held shares. It was understood that the latest rules would soon be followed by another set of provisional guidelines regulating the transfer of state assets.