Foreign Investment in China

Setting up a foreign invested travel agency in China

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To meet its undertakings upon the entry into the WTO, China has promulgated the Regulation on Travel Agency (“Regulations”), effective as from May 1, 2009, which also incorporates rules for setting up foreign invested travel agencies (“FITA”). Previous regulations issued by Ministry of Tourism (“MOT”) and Ministry of Commerce (“MOC”)…

Trial Measures for the Investment in and Establishment of Sino-Foreign Equity Joint Venture Enterprises and Sino-foreign Cooperative Joint Venture Enterprises by Domestic Natural Persons in Pudong New Area

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Trial Measures for the Investment in and Establishment of Sino-Foreign Equity Joint Venture Enterprises and Sino-foreign Cooperative Joint Venture Enterprises by Domestic Natural Persons in Pudong New Area

Promulgating Institution: Shanghai Administration of Industry and Commerce; Shanghai Pudong New Area People’s Government
Document Number:…

New rules for setting up representative office in China

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On November 19, 2010, China Cabinet, the State Council, promulgated a new piece of regulation, entitled “Regulation on the Administration of Registration of Representative Offices of Foreign Enterprises”, overhauling and replacing the old rules that have been in operation as from March 15, 1983.

There are a number of notable changes in these new rules.…

The basic steps for setting up a foreign invested enterprise in China

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1. the Catalogue of Industries for Guiding Foreign Investment in China

China has put in place for long a Catalogue of Industries for Guiding Foreign Investment in China (the “Catalogue”) which may from time to time be amended to reflect economic changes in reality. In this Catalogue, industries are basically classified into four types: encouraged, restricted,…

Representative Office’s Taxation Issues in China

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Representative Office’s Taxation Issues in China

Written by Yang, Shujuan

The most direct way to indulge into the China market is to set up local presence. Various forms of foreign investment vehicles are available for different business objectives and operations, including, among other things, equity joint ventures, cooperative joint ventures , or…

Individual income tax reduction raised in China

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On December 29, 2007, the China’s parliament, the standing committee of the National People’s Congress, has just enacted an amendment to the Individual Income Tax Law, raising the threshold of the amount of taxable income from RMB 1,600 to RMB 2,000, a move aimed to alleviate the embarrassment of the pockets of the low income earners against the backdrop…

Entities you can set up under China Company Law

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Though in a foreign investment context, we often use the foreign invested enterprise to refer to the entities foreign investors may set up in China, nowadays most entities established by foreign investors are companies under the company law of China rather than an enterprise. In the Chinese legal jargon, a company is for sure regarded as an enterprise but an…

Enterprise Bankruptcy Law of the People’s Republic of China

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Enterprise Bankruptcy Law of the People’s Republic of China

  (Adopted at the 23rd Meeting of the Standing Committee of the Tenth National People’s Congress on August 27, 2006)

  

Chapter I  General Provisions

  Article 1 This Law is enacted with a view to regulating the procedure for enterprise bankruptcy, fairly settling…

Corporate governance structure of foreign invested companies

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Chinese foreign investment regulation originated earlier than the enactment of the first Company Law of China (1994) and this together with other reasons gave rise to the irregular corporate governance structure of foreign invested enterprises (which term generally excludes foreign invested companies limited by shares) where there was generally no …

Supreme court seeking comments to judicial interpretation draft relating to condominium ownership

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On June 16, 2008, the People’s Supreme Court of China published the Interpretation on Several Issues regarding Application of Law in Trial of Cases Involving Condominium Ownership (the “Condo Interpretation”) and asked for public comments thereof. The original Chinese text of the draft Condo Interpretation is on the following website:
http://www.chinacourt.org/html/article/200806/16/307335.shtml

Chinese Lawyers practicing in Foreign Law Firm Representative Office

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Laws and Regulations

At present, the major regulations governing Chinese practicing lawyers’ practice in Foreign Law Firm Representative Office (“R.O.”). are as follows:
• Regulations on the Administration of Foreign Law Firms’ Representative Offices in China (“Regulations”)
• Provisions of the Ministry of Justice on the Execution…

changes to be approved before amending registration

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Since many documents especially the articles of association involved in setting up a foreign invested company have to be approved by foreign investment department (“Approving Authority”) beforehand prior to registering the company with the company registration agent, the State Administration of Industry and Commerce and its local counterparts…

Baby shareholder established by a decided case

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A court in Minhang District in Shanghai delivered a judgment that aroused interests among the public, in which the court held the two babies, one of 5 years old and the other of 6 years old, were entitled to be registered as shareholders of a company. While the copy of the judgment is not available, the information from the Internet suggested that the company is …

Guidelines for pursuing foreign investors’ liabilities in the case of abnormal capital withdrawal

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On November 19, 2008, four Chinese ministries, namely, Ministry of Commerce, Ministry of Foreign Affairs and Ministry of Justice jointly issued a circular, Guidelines for Cross-border Pursuit and Litigation by Chinese Parties in respect of Abnormal Capital Withdrawal by Foreign Investors (“Guidelines”), an attempt to curb deviant withdrawal of…

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