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Guide for Setting up Regional Headquarters of Multinational Companies in Beijing
Beijing, as the political center, cultural center, international communication center and scientific and technological innovation center of China, is accelerating the construction of an international scientific and technological innovation center, an international consumption center and a global digital economy benchmark city under the guidance of the development of the capital in the new era.
Profit Repatriation from China FIE
The profits obtained by the foreign investors within the territory of the PRC can be freely remitted out according to the Foreign Investment Law of the PRC. However, foreign invested enterprises (FIE, foreign invested limited liability companies) must meet certain conditions and complete specific procedures when applying to remit out the distributed profits (dividends) to overseas shareholders.
China Releases Guidance on Non-Compete Compliance
The General Office of the Ministry of Human Resources and Social Security of China officially released the Compliance Guidelines on the Implementation of Non-Compete Restrictions by Enterprises (Renshetingfa [2025] No. 40) on 4 September 2025, aiming to give non-compete compliance guidance to enterprises. The guidelines shall take effect from the date of release.
Conditions for High-Tech Enterprise Recognition in China
The standard corporate income tax rate in China is 25% currently. Ratified high-tech enterprises may enjoy a preferential corporate income tax rate of 15% and receive policy support such as special funds from national and local governments, scientific and technological project funding, and additional deductions for R&D expenses. So what are the conditions to apply for high-tech enterprise recognition?
Onshore RMB Contribution Made by Foreign Investors
According to the relevant laws and regulations in China, foreign investors should make their capital contribution to their foreign invested enterprises established in China in foreign exchange or offshore RMB, except for the circumstances explicitly stipulated by laws and regulations that onshore RMB can be used for capital contribution.
Acceleration of Shareholder’s Capital Contribution Obligation
The new Company Law of the PRC, which came into effect on 1 July 2024, for the first time clarifies in legislative form that the rules for the accelerated expiration of shareholders' capital contribution obligations may be applied when a company is under non-bankruptcy, non-dissolution, non-execution status.
Capital Reduction Rules under the New PRC Company Law
Substantive capital reduction refers to the substantial reduction of a company's registered capital and the reduced registered capital will be refunded to the shareholders or the shareholders will be exempted from the obligation to contribute capital or share payments. According to Article 224 of the Company Law of the PRC, substantive capital reduction shall be conducted in accordance with the following statutory procedures:
Introduction to China's Capital Account Settlement Management Policies
In order to better meet and facilitate the business and capital operation needs of domestic enterprises, the State Administration of Foreign Exchange has unified and standardized the management of the willing settlement and payment of foreign exchange income under capital accounts throughout the country.
Compensation Liability of Director and Senior Management
The revised Company Law of the PRC, which came into force on 1 July 2024, significantly increases the compliance obligations and legal liabilities of the directors, supervisors and senior management personnel. Below is a summary of the compensation liabilities of the directors, supervisors and senior management personnel under the Company Law for your easy reference.
Liabilities for Shareholder’s Insufficient Capital Contribution
The Company Law of the PRC, which came into effect on 1 July 2024, strengthens the supervision of shareholder’s capital contributions and explicitly specifies the legal liabilities and consequences arising from shareholder’s insufficient capital contribution. Insufficient capital contribution includes not paying capital contribution in full and on time, or the actual value of non-monetary assets served as capital contribution is significantly lower than the subscribed capital contribution.