A wholly foreign-owned enterprise in China refers to an enterprise established by a foreign investor with all the capital established in China in accordance with relevant Chinese laws. It is a Chinese legal person and does not include branches of foreign companies and other economic organizations in China. Foreign-owned enterprises are also referred to as foreign-funded enterprises. The specific forms are foreign-funded joint ventures and foreign-owned enterprises. Its investors can be foreign companies, other economic organizations and individuals.
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1. Independently and freely carry out the parent company's global strategy without considering the factors of Chinese investors.
2. Ability to formally conduct business without having many restrictions like a representative office.
3. Raise RMB invoices to customers with RMB as income.
4. RMB profits can be converted into US dollars and remitted to overseas parent companies. Can hire employees directly in China.
5. Protect intellectual property rights and proprietary technology.
6. Do not need to share profits with other parties.
7. It is more efficient in operation, management, and future development.
In China, company names have certain restrictions. In the same industry, except for the company name cannot be the same, the trade name cannot be the same either. Each name will be valid only after have been verified and reserved by the industry and commerce department. There are many factors to be considered in the naming: for example, the word ˇ°cityˇ± must be approved by the municipal level; with ˇ°provincialˇ±, it needs to be approved by the provincial level unit; with the word ˇ°Chinaˇ±, it must be approved by the Ministry of Commerce of China.
1. Shareholders: foreign companies, individuals or partners (including Hong Kong, Macao and Taiwan)
2. Directors: They may be foreign parties or Chinese personnel. The company may establish a board of directors or an executive director, responsible for carrying out all major matters of the company and being accountable to shareholders;
3. Supervisors: Anyone from overseas or in mainland China can hold this position. If there is only one shareholder, additional supervisors are required.
4. Legal representative: The legal representative of a wholly foreign-owned enterprise may be a person from overseas or Mainland China. They may be shareholders or directors, or may be non-shareholders and directors. The legal representative is mainly responsible for managing the operation and management of the company. It bears corresponding legal responsibility, and the legal representative is usually the director of the company or the general manager.
The business scope refers to the specific business operations that a wholly foreign-owned company wants to engage in 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., special approval is required.
In China, the requirements for registered capital in different industries are different, such as production-type registered capital: recommended RMB 1 million, trade type: recommended RMB 500,000, retail type: recommended RMB 300,000, consulting type: recommended minimum RMB 100,000; Beginning in 2014, the government canceled the minimum registered capital requirement and allowed the registered capital to adopt a subscription system, allowing the registered capital to be paid in place within 30 years from the date of issuance of the business license.
1. The application for the establishment of a foreign-funded enterprise with a record receipt;
2. Conduct industrial and commercial registration;
3. Go to the relevant department to make a record;
4. Apply for other licenses.
