For individual investors a passport copy is required (certified by the Chinese Embassy), Capital credit certification from each investor’s bank, Copy of passport for (i) JV’s director, (ii) JV’s legal representative, and (iii) JV’s supervisor, Leasing contract for office space in China, certification of real-estate ownership, landlord’s identification, Letter of authorization (authorizing the JV to accept service in China on behalf of the investor(s)), In some cases, latest annual audit report from the foreign investor provided by a certified public accountant, Any prior reviews or approvals from government branches (for example land-use rights if required), Record establishment of the business and official seal engraving with the Division of Entry & Exit Administration of the local Public Security Bureau, Obtain certificate with the organization’s code number from the Technical Supervision Bureau, Register with and obtain certificates from both the state and local, Tax reports should be submitted to the Tax Administration Department on a monthly, quarterly and annual basis, Register with and obtain a certificate from the, Obtain certificate of financial registration from the local Finance Bureau. For more specific information or questions related to your foreign invested enterprise, please contact us. This amount is fixed in the articles of association of a JV, and constitutes an investment commitment (subject to any increase or decrease of registered capital approved by the government). Once the approval certificate has been received, investors must apply and register for a business license with the AIC. Goldman Sachs plans to acquire 100 per cent of its mainland Chinese joint venture, the latest global bank to seek full control of its business as Beijing further opens up the financial sector. In The China Joint Venture Squeeze Out: Coming Soon to a Public Company Near You, we set out the fundamental advice … Rules, regulations and access to the domestic market clearly favor this method. There is no commitment to finance this portion of the investment but such debt financing may be obtained at the JV’s discretion. Plan for the tariffs, sanctions, and export/import controls that you may encounter when exporting abroad. Once the above documents are ready and accepted by the AIC, the Municipal Commission of Commerce (MOC) will issue a formal approval letter in favor of the Joint Venture incorporation assigning the entity an enterprise code. But the plane maker only does a small amount of manufacturing in China and doesn't have any major joint ventures there. Normally operation of a join… Once a business license is issued, certain post-registration formalities must be completed including: JVs are also required to appoint at least one individual (of any nationality and residency) as the supervisor of the JV. The Foreign Investment Law has been widely promoted as a framework that will emphasize equal national treatment of foreign investment, putting foreign investors on equal footing with domestic investors in the Chinese market and giving them equal protections. It is recommended that a clause be added to the lease voiding the contract without penalty should the JV application be rejected. The need for a registered address and the assignment of entities to commercial or industrial locations depends on the specific business and industry that the JV will target. Once the partners are chosen, several documents need to be drafted or obtained, including the following: After the foreign and Chinese counterparts reach an agreement on establishing a joint venture together, a letter of intent (LOI) should be drafted. If the right to the use of the site does not constitute a part of a Chinese partner's investment, the joint venture shall pay the … Equity Joint Venture (EJV) The Equity Joint Venture (“EJV”) is probably the most common of the foreign investment vehicles in China. Apply for financial support, or take part in programs that help innovative or growth-oriented firms, and underrepresented groups. The purpose of a JV contract and Articles of Association is to lay down the principles of the organization, its methods of operation, and management rules or principles to be adopted. Before beginning the application process investors must lease office space for their future business. The regulations state that Chinese joint venture partners cannot steal intellectual property and trade secrets from their foreign partners. The JV’s investors must pay 15% of the registered capital of the JV within the first three months after issuance of the business license (similar to a certificate of incorporation under Canadian law), with the balance due within the first two years. All applications must be submitted in Chinese and, in addition, may be written in a foreign language. Foreign investors may wish to engage a consulting company to represent their interests while establishing the JV, benefiting as well from their long standing relationships with local authorities and procedural know-how. China to drop 50:50 rule and allow foreign majorities in joint ventures 18 April 2018 China is to allow foreign vehicle manufacturers to own more than 50% of their joint ventures with domestic companies, removing a two-decade restriction and giving a boost to business seeking to capture a share of the world’s biggest vehicle market. The China Securities Regulatory Commission (CSRC) over the weekend gave formal authorisation for foreign players to apply for a 51% ownership in a Chinese fund management firm, according to guidelines (in Chinese) released by the regulator. Please contact us major joint ventures there some of the company Hawksford is an provider. Participating in a JV is an established provider of company registration and outsourced services! A tax clearance declaration report, essentially an audit of the incorporation steps, investors to... If the joint venture in China, Hawksford can help should be upheld to finance portion... 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