The procedures for establishing a Resident Permanent Representative Office (RO) vary slightly in different areas of China and also vary in accordance with the places where the foreign companies are located. In general, the procedures for the establishment of a Permanent Representative Office consist of three steps:
China Representative Office Registration. Change of Name of the Representative Office,Application for Extension of Residence of a China Representative Office. The duration of the residence for the Representative Office (RO) is registered in the registry office, which is starting from the date on which the registration certificate is issued by the registry office.
A liquidation committee is composed of its shareholders to handle the liquidation within 15 days from the dissolution date of the company. The liquidation committee shall liquidate and value the company’s assets in accordance with Chinese law and the articles of association.During the course of liquidation, the company shall not conduct any business activities irrelevant to the liquidation.
For an incorporation of an entity in China, there are many procedures, legal documentation and various governmental requirements. One of the documents to be submitted for the purpose of registration of a WFOE is the duly legalized Certificate of Incorporation or identity document of the shareholder of the WFOE.
In accordance with the Company Law of the PRC, the board of directors established by a limited liability company to be composed of 3 up to 13 members. However, for a limited liability company with a relatively small number of shareholders or for a limited liability company relatively small in scale, it may appoint one executive director only and does not have to establish a board of directors.
Procedures for Approval of Permanent Representative Office Established in Shanghai by Tourism Enterprises, Tourism Market Management Department of Shanghai Municipal Tourism Administrative Commission. Verification of the application shall be completed by Shanghai Municipal Tourism Administrative Commission within 30 working days after acceptance. If approved, it shall be submitted to the National Tourism Administration of P.R.C. for approval.
The head office of a representative office (RO) shall apply for deregistration upon the occurrence of the following events: (1) the head office decides to close down its RO in China; (2) the RO will not continue its operation upon the expiration of its residence in China; (3) the head office ceases to exist; (4) the RO has been ordered to close down in accordance with the law. The RO shall apply for deregistration with various registration authorities involved
China encourages foreign investors to invest in China, and with the continuous updating of the Special Administrative Measures for Foreign Investment Access (Negative List), restrictions on foreign investment access have been liberalized or cancelled in many investment areas. On March 29, 2022, the State Council of China revised and issued the latest Administrative Provisions on Foreign-Invested Telecommunications Enterprises, which comes into effect on May 1, 2022.
Equity joint ventures are the second most common manner in which foreign companies enter the China market and the preferred manner for cooperation where the Chinese government and Chinese businesses are concerned. Joint ventures are usually established to exploit the market knowledge, preferential market treatment, and manufacturing capability of the Chinese side along with the technology, manufacturing know-how, and marketing experience of the foreign partner.
Social organization refers to a non-profit organization (“NPO”) formed voluntarily by Chinese citizens to carry out activities in accordance with its articles of association to realize the common wishes of its members.