Business China

What are the Conditions to Register a Foreign Invested Company?

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As we all know, the registered foreign companies can enjoy some preferential policies. So what are the conditions to register a foreign company? Today BC Partner will share them with you:

What are the conditions to register a foreign company? I hope tips in the following will help you.

1. The shareholders of foreign enterprise The shareholders of a wholly foreign-owned company can be a foreign enterprise or a foreign resident. Shareholders of sino-foreign joint ventures have different requirements for Chinese shareholders that shareholders cannot be a Chinese resident and must be Chinese companies.
When a foreign company is registered, it should submit and verify the identity certificate of the shareholder. Foreign enterprises should submit notarized valid business licenses, and foreign individuals should submit notarized passports.

2. The supervisors of foreign enterprises If there is a board of supervisors, there should be at least three supervisors. If there is no board of supervisors, a supervisor can be set up, which can be a foreign individual or a mainland Chinese resident. When registering a foreign company, the identification of the supervisor shall be submitted, and no notarization certification is required.

3. The directors of foreign enterprises When a foreign company is established, a board of directors may be established or not. If the board of directors is not established, an executive director shall be established. A foreign company’s director or executive director may employ mainland residents or appoint foreign individuals. When a foreign company is registered, the director shall submit identity document, and no notarized file is required.

4. The registered capital of foreign-funded enterprises Since 2014, the ministry of commerce cancelled the initial contribution rate, capital contribution ratio and capital injection time limit for foreign investment (including Taiwan, Hong Kong and Macao investment). The amount of capital contribution, means of contribution and term of investment should be agreed upon by the company's investors (shareholders and sponsors) and should be clearly stated in the contract of joint venture (cooperation) and the articles of association of the company. The competent commercial departments at all levels shall make clear the above-mentioned contents in the approval. In addition to the provisions of the laws, administrative regulations and the State Council's decision on the minimum registered capital for a particular industry, the minimum registered capital of the company shall be cancelled. In addition to the temporary non- registration of capital subscribed registration system, there is no longer to check the payment of the company's registered capital.

5. The name of foreign enterprises When a foreign-funded company is registered, the name of the company shall be approved first. We recommend you to submit multiple names to be checked by the authority. According to the naming rules of companies registered in Shanghai, in the same industry, the company name must be the same name cannot be homophones nor synonyms for the same industry; the combined multiple names should be disassembled for checking.

6. Business scope When a foreign-funded company is registered, the scope of business must be clearly defined and the scope of its business shall not exceed the scope of its business. The scope of business operation is within 100 words, including the punctuation.

The registration of Chinese foreign-funded companies need to be approved by related authorities concerned. For instance, the approval of the ministry of commerce will be required for some industries, such as mining, retail and other industries that have some restrictions to foreign investment.

7. The register address of the company The registered address of the company must be the office address of the business. It shall provide the lease agreement, the copy of the property certificate and the lease invoice.

8. The company's articles of association When the company is established, the company's articles of association shall be submitted to the Business Administration Department. The company's articles of association determine the company's name, scope of business, shareholders and proportion of capital contribution, registered capital, rights and obligations of shareholders, directors and supervisors, etc.

9. The feasibility study report A feasibility study report is required during a foreign company’s incorporation process.

10. Financial personnel A company shall submit some materials of an accounting personnel’s information for tax registration, including a copy of the personnel’s identity certificate, a copy of Certificate of Accounting Profession and one photo.

11. Legal representative A foreign capital enterprise shall have a legal representative who may or may not be a shareholder. The legal representative of a foreign-capital enterprise or a sino-foreign joint venture may be a Chinese or a foreigner. When a foreign company is registered, the identity certificate of the company’s legal representative should be submitted.

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