Business China

China Partnership Firm

+86-020-2917 9715
The Measures of Establishment of Foreign Invested Partnership Enterprises (FIPE) in China is taking effect since March 1, 2010. The good news is, under the new law, there is no required minimum registered capital for a Foreign Invested Partnership Enterprise (FIPE) in Shanghai, Shenzhen, Hangzhou and other big cities in China. Business China offers professional services to businesses that are looking forward to setting up a China Partner firm.

Foreign Invested Partnership Enterprise (FIPE)

Profit Repatriation

The Chinese government now allows Foreign Invested Partner Enterprises, otherwise known as FIPE to remit profits our of China. The news is, these types of remittances do not need the approval of the State Administration of Foreign Exchange (SAFE). Furthermore, the dividends are not allowed to be distributed or repatriated to any overseas country if any previous losses have first not been covered. The dividends that are not distributed during past years shall be distributed together with the dividends of the current year. Repatriating registered capital to home countries is also forbidden under the new law during the term of business operation. 

Any partnership company is basically a profit-making entity that is jointly funded, co-financed and shared by several partners. It is considered to be a profit-making organization which has unlimited joint and joint liability for corporate debt. Foreign Invested Partnership Enterprises or FIPE refer to those foreign companies that have been set up by two or more partners. In China, a Foreign Invested Partnership Enterprise can be established in two ways:

  • Two or more foreign individuals or enterprises shall establish a partnership in China, with all of them being foreign individuals.
  • Foreign individuals or enterprises shall establish partnerships in China with individual persons, legal corporation and other organizations of China.
  • Advantages of China Foreign Invested Partnership Enterprise
  • Under the new law, all Chinese individuals are now allowed to directly take part as an individual investor, which is considered to be slightly different from a Joint Venture (JV).
  • Under the new law, there is no need to apply for further approved for establishing the business.
  • Under the new law, there’s no capital injection needed or a stipulated minimum capital. 
  • The enterprise is allowed tokeep a simple management mechanism structure, higher decision-making capabilities, while keeping management costs low.
  • No need to pay a Corporate Income Tax.
  • Significantly reduces the operating cost of the business, leading to more profit margin. 

Disadvantages of China Foreign Invested Partnership Enterprise

Before starting a business anywhere, it is important to know about both the advantages and disadvantages of venturing out to new markets. The following are some of the disadvantages of a Foreign Invested Partnership Enterprise.

Industrial Boundaries for China Foreign Invested Partnership Enterprise

The prohibited classes marked as "China relative holding", "limited to the joint venture and cooperation", "shall be limited to the joint venture", "limited to cooperation", "China holding company", and projects with foreign investment proportion requirements in the Foreign Investment Industrial Guidance Catalogue shall not set up any foreign-funded partnership enterprises.

General Partner Bears Unlimited Liability, While Limited Partner has Been Granted No Rights for Enterprise Management

A general partner under Foreign Invested Partnership Enterprise assumes unlimited joint liability for the debts the FIPE incurs. This is different in traditional Chinese-foreign joint ventures, or Sino-foreign cooperative enterprises, or WFOE who adopt the limited liability company organization. The company forms shareholders bear limited liability for any debts that are based on the subscribed capital contribution to the enterprise.

While a PRC FIPE Law already stipulates that every FIPE needs to have at least one general partner, while other partners can serve in a limited partner capacity. General partners are to bear unlimited joint and several liabilities for the debts of the partnership, while limited partners, on the other hand, are limited to the subscribed capital contribution to bear the liability for the debts of the partnership. That being said, limited partners shall be prohibited from exercising the partnership management and shall not carry out the partnership affairs, or represent the limited partnership.

The process of creating a Foreign Invested partnership Enterprise can get complicated, which is why you would want to have the best experts for the task by your side. We offer our professional experience and expertise in helping foreign firms create Foreign Invested Partnership Enterprise in China.

To find out more about our services please feel free to contact us at +86-020-2917 9715, or send us an email with your queries to

  • James Oliver "True professionals, very helpful and dedicated. Your support team is fantastic."
  • Robert Gatti "Our advisor was brilliant and we were given more help that we knew we needed. What I liked most about Business China's service was the prompt and businesslike approach.It helped us dramatically. At a...
  • Vivian Belfanti "Quality work and friendliness is why I chose to work with Business China. Business China is organized very easy to work with."
  • Tim Orchard "Thanks to Business China’s professional guiding and efficient processing about company incorporation and VAT refunding, our new entity in Guangzhou already step into a virtuous circle. I have to say...
  • Victor Declety "Business China allows us to focus on our customers instead of being tangled into enterprise level business incorporation and maintance."
  • Ben Hunter "Business China is helping people who don't necessarily know how to connect your current business with the booming Chinese market and how to lay out your 'China Dream' here specifically. It has been...
  • Daniel Wong "A great customer experience! The flexability and speed of response from the account manager, as well as the quality of the service process was exceptional."
  • Stacey Morris "Businesss China has been superb. Their customer service is great. The guys there respond very quickly and go above and beyond that help."
  • M. Salem Having real-time information allows us to deal with issues immediately before they become problems.We are satisfy with Business China.
Request a Proposal

Drop Business China a quick message to let us know about your incorporation needs.