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Wholly foreign-owned Chinese company registration

Wholly foreign-owned Chinese company registration

by · 10/10/2020, 7:53:43 AM

A wholly foreign-owned Chinese company refers to an enterprise established by foreign investors in accordance with relevant Chinese laws with all their capital established in China. It is a Chinese legal person, excluding branches of foreign companies and other economic organizations in China. Foreign-funded enterprises are also called foreign-funded enterprises. Specific forms include foreign-invested joint ventures and foreign-invested enterprises. Its investors can be foreign companies, other economic organizations and individuals.

Registering a wholly foreign-owned company has the following advantages:

1. Independently and freely execute the parent company's global strategy, regardless of the factors of Chinese investors.

2. Ability to formally conduct business without many restrictions such as representative offices.

3. Issue RMB invoices to customers whose income is RMB.

4. Renminbi profits can be converted into U.S. dollars and then remitted to overseas parent companies. Employees can be employed directly in the country.

5. Protect intellectual property rights and know-how.

6. There is no need to share profits with other parties.

7. Operation management and future development are more efficient.

Wholly foreign-owned company name: In China, there are certain restrictions on company names. In the same industry, except for the company name, the product name cannot be the same. Each name is valid only after it has been confirmed by the industrial and commercial department. There are many factors to consider when naming: for example, the word "city" must be approved by the municipal department; if there is the word "province", it must be approved by the provincial unit; the word "China" must be approved by the Ministry of Commerce of China.

Shareholders, directors, supervisors and legal representatives:

1. Shareholders: foreign companies, individuals or partners (including Hong Kong, Macao and Taiwan)

2. Director: It may be a foreigner or a Chinese person. The company may establish a board of directors or an executive director who is responsible for the implementation of all major issues of the company and is responsible to shareholders;

3. Supervisor: Anyone from overseas or mainland China can hold this position. If there is only one shareholder, one more supervisor is needed.

4. Legal representative: The legal representative of a wholly foreign-owned enterprise can be a person from overseas or mainland China. They can be shareholders or directors, or non-shareholders and directors. The legal representative is mainly responsible for the operation and management of the company. Undertake the corresponding legal responsibilities, and its legal representative is usually the director or general manager of the company.

Business scope: The business scope refers to the specific business activities of a wholly foreign-owned company in China. The business scope of a Chinese company is directly restricted by the company name and registered capital; for example, the larger the registered capital, the wider the business scope. If the business scope involves some special industries, such as education, logistics, medical care, food circulation, etc. , Requires special approval.

Registered capital and paid-in capital of sole proprietorship: In China, different industries have different requirements for registered capital, such as production registered capital: 1 million yuan, trade: 500,000 yuan, retail: 300,000 yuan, consulting: 100,000 yuan ; Since 2014, the government has cancelled the minimum registered capital requirement and allowed the registered capital to adopt the subscription system, allowing it to be in place within 30 years from the date of issuance of the business license.

The registration procedure of a wholly foreign-owned company is generally as follows: 1. Apply for the establishment of a foreign-invested enterprise with the filing receipt; 2. Perform industrial and commercial registration; 3. Go to the relevant department for record; 4. Apply for other licenses.

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