Sino-foreign Joint Venture Company refers to enterprises formed by foreign investors and Chinese investors within the territory of the People's Republic of China on the principle of equality and subject to approval by the Chinese government. In order to establish a Sino-foreign joint venture in China, the first step shall be to find a qualified and agreeable Chinese partner. In this regard, it should be kept in mind that Chinese laws often provide for qualification requirements on the Chinese partner to a joint venture.
I. Documents Required for Sino-foreign Joint Venture
Chinese Partner provides:
(1) copies of the identity cards of the Chinese investors;
(2) copies of Chinese partner's local company business license with company stamp;
(3) copies CPA firm's capital verification report with Chinese partner's company stamp;
(4) copies Chinese partner's last year audit report with company stamp;
(5) copy board director's name list of the Joint Venture;
(6) copies of Chinese partner's local company's article of association;
Foreign Partner provides:
(1) Certificate of Incorporation or Equivalent document certified by Chinese embassy or Chinese consulate overseas;
(2) Bank Reference Letters from investor’s bank to declare a good standing;
(3) Passport copy of: Parent company's director, China company's Legal Representative and China company's supervisor;
(4) China Legal Representative provides: photos (2 inches size), brief resume;
(5) Information about foreign investors, including name, address and telephone number;
(6) Letter of Authorization.
II. Name Registration
Within 30 days of approval for the project listing/project proposal, the enterprise name registration procedure should be conducted with the relevant local branch of the AIC. The proposed name could be registered with the registration authority to prevent third parties from using the same enterprise name, regardless of the fact that at the time of enterprise name registration, the JV is yet to be formed.
III. Office Location
Before beginning the application process investors must lease office space for their future business. It is recommended that a clause be added to the lease voiding the contract without penalty should the JV application be rejected. Office relocation requires a tax clearance declaration report, essentially an audit of the company.
IV. Establishment of Sino-foreign Joint Venture
The approval authority will make a decision as to whether or not to approve the establishment of the joint venture within 30 to 45 working days. In the case of a positive approval, the approval authority will issue a formal approval letter (in Chinese) in favor of the joint venture. If the approval authority refuses to grant the approval, it will raise comments on the documentation concerning the joint venture and withhold the approval until the documents have been amended to its satisfaction.
V. Licensing
Once the approval certificate has been received, investors must apply and register for a business license with the AIC. AIC requires most of the same documents as MOC, plus its own standard filing forms. Once a business license is issued, certain post-registration formalities must be completed.
Contact Us
If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020,Dongmen Rd South, Luohu , Shenzhen, China.
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