1. What’s the cap of contribution of a foreign investor by patent technology while establishing a Sino-foreign joint venture? What special formalities?
Please refer to the Rules for the Implementation of the Law of the People’s Republic of China on Foreign-Capital Enterprises (Revised in 2001) and Article 27 herein that in event a foreign investor makes contribution with industry property or proprietary technology used as capital investment, the industry property or proprietary technology should be possessed by the foreign investor. The pricing of the industry property or proprietary technology should be in line with the pricing principle of the international convention, with its pricing amount no less than 20% of registered capital of foreign investment enterprise.
2. What formalities shall be handled if a foreign wholly-owned enterprise invest and produce within China?
Please refer to the Catalogue for the Guidance of Foreign Investment Industries firstly and then conduct the related examination and approval in accordance with the types of enterprises to be set up in line with the Law of the People's Republic of China on Foreign-Capital Enterprises, the Rules for the Implementation of the Law of the People’s Republic of China on Foreign-Capital Enterprises, the Regulations for the Implementation of the Law of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures and the Rules for the Implementation of the Law of People's Republic of China on Chinese-foreign Contractual Joint Ventures, and consult the local commerce department for specific examination and approval. And please consult the related department of Australia for Australian formalities.
3. What requirements shall foreign investment development property enterprises meet while borrowing foreign debts?
Apart from the conditions of foreign debts for the general foreign investment enterprises, the foreign investment development property enterprises shall also while borrowing foreign debts meet the following requirements:
(1)Full payment of registration capital by foreign investment property enterprise;
(2)Certificate for the use of state-owned land;
(3)Capital of development project accounting for 35% or above of total investment; and
(4)In event the registration capital shall be no less than 50% of total investment if the total investment of a newly-established foreign investment property enterprise surpasses USD10m (including USD10m). In event the total investment is below USD10m, the registration capital shall be still subject to the existing provisions.
4. Suppose the registered capital applied by a Sino-foreign joint venture (cooperative) enterprise decreases, what does the competent commerce authority mainly review? What materials shall be provided by a Sino-foreign cooperative enterprise? And what does the competent commerce authority mainly review?
The application of alteration shall be filed in the commerce department conducting examination and approval of the enterprise while a Sino-foreign joint venture (cooperative) enterprise applies the alteration of registered capital (increase or decrease of registered capital). The enterprise shall submit the new board resolution, the amendment agreement of the articles of association and the report on alteration of application while applying for alteration. The Sino-foreign joint venture (cooperative) enterprise approved by the Ministry of Commerce or the higher-level commerce management department shall also report to the higher commercial management department for filing. Please consult the local provincial-level foreign economic and trade commission (department) or the commerce bureau for specific information.
5. Whether it is a necessary requirement that the business license is possessed of the import-export operation right while a foreign trade operator goes through the formalities for record?
Pursuant to related provisions in the Foreign Trade Law of the People’s Republic of China (revised in 2004) and the Measures for the Record-filing and Registration of Foreign Trade Operators (No. 14 Circular of the Ministry of Commerce in 2004), the foreign trade operators planning to go through the formalities for record shall handle the business license in the industrial and commercial sectors to expand the scope of import-export business prior to filing a record.
6. I’d like to know whether the attached documents shall be provided when undertaking wholesale and retail of beer and wine in China
According to the Department of Market Operation Regulation under the MOFCOM, the Measures for the Administration of Alcohol Circulation has been implemented in 2006, which launched the attached document system for alcohol circulation with a view to regulate the alcohol market, enhance efforts on administration of circulation channels, restrict operation behaviors and ensure the traceability of circulation information of alcohols from factory to sales terminal. Since the beer is featured by a large amount, short circulation period and concentration of consumption peaks, the attached document system temporarily has not been executed in the beer market after considering the opinions of enterprises and experts in the field.
7. Should the investor pay up within 3 days after issuance of the business license for the foreign-invested company in case the foreign investor acquires a domestic enterprise to establish a foreign-invested enterprise with foreign capital contribution lower than 25% and pay in cash?
Pursuant to Article 16 of the Provisions on Acquisition of Domestic Enterprises by Foreign Investors, where a foreign investor establishes an enterprise by acquiring a domestic enterprise, if the ratio of capital contribution by the foreign investor is less than 25% of the registered capital of the enterprise and the investment is paid in cash, the capital shall be paid up within 3 months since issuance of the business license for the foreign-invested enterprise; if the investor makes its/his contribution in kind or industrial property, the investment shall be paid up within 6 months since issuance of the business license for the foreign-invested enterprise.
8. How many auditing reports shall be submitted (prepared) during liquidation of a foreign-invested enterprise?
Generally, the auditing reports are required when dealing with foreign exchange and Renminbi assets. For details, please consult local commercial department and administration of foreign exchange.
9. What conditions should they meet when the Foreign-invested real estate enterprises in development class borrow external debts?
In addition to meet the conditions of general foreign-invested enterprises in terms of external debts, there are other conditions the foreign-invested real estate enterprises in development class should have as follows:
1. foreign-invested real estate enterprises should pay all the registered capital;
2. to obtain the State-Owned Land Use Rights Certificates;
3. the capital of development projects should be above 35% (included) of the total investment;
4. For the new foreign-invested real estate enterprises, when the total investment is more than USD10m (included), the registered capital shall not be less than 50% of the total investment; when the total investment is less than USD10m, the registered capital shall still follow the current regulations.